Express Scripts reaches $9.5 million settlement with 28 states over allegations of misleading consumers to obtain rebates

Officials from pharmacy benefit manager Express Scripts on Tuesday said the company has agreed to pay $9.5 million to settle lawsuits brought by 28 states and Washington, D.C., alleging it defrauded the states and D.C., the

Under the agreement, Express Scripts will pay $9.3 million to the states and an additional $200,000 to patients in payments of no more than $25 each as reimbursement for doctors visits and tests linked to switching cholesterol drugs. The PBM also must make "clear and conspicuous disclosures" about its drug-switching procedures (Jewell, AP/Denver Post, 5/28). Express Scripts also will be prohibited from asking that physicians switch patients to higher-priced drugs, asking for a switch when a generic equivalent is available or if the patent on the original drug is to expire within six months, and asking for a change after a patient has been switched to a new drug in the past two years (Raleigh News & Observer, 5/27). Express Scripts said it would need to make "only minor adjustments" to meet terms of the deal (AP/Denver Post, 5/28).

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Vermont Attorney General William Sorrell (D) said, "Today's settlement completes our effort to clean up the PBM industry." The Wall Street Journal reports that PBMs Medco Health Solutions and CVS Caremark have reached similar agreements with the states. Sorrell added, "Now that three of the nation's largest PBMs are under orders from our office and the court to reform their practices, we expect that the rest of the industry will take notice and follow the requirements we have established" (Edwards, Wall Street Journal, 5/28). In a statement, the PBM said it "has implemented and continually refined its procedure to ensure than any drug switches were safe and appropriate, and intended to lower costs for both its clients and plan sponsors" (AP/Denver Post, 5/27).

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This article was reprinted from khn.org with permission from the Henry J. Kaiser Family Foundation. Kaiser Health News, an editorially independent news service, is a program of the Kaiser Family Foundation, a nonpartisan health care policy research organization unaffiliated with Kaiser Permanente.