Corporate Compliance

Express Scripts to pay $9.3 million to settle switching allegations

Compliance Monitor, June 4, 2008

Pharmaceutical benefits manager Express Scripts allegedly engaged in deceptive business practices by overstating the cost benefits of switching to certain brand name medicine, according to a press release from Massachusetts Attorney General Martha Coakley.
 
As a result, the company will pay $9.3 million to 28 states and the District of Columbia. Express Scripts allegedly switched patients to brand-name cholesterol drugs to try and maximize volume rebates from pharmaceutical manufacturers. The switches resulted in higher costs to consumers.
 
Under the settlement, Express Scripts will not solicit drug switches when:
  • The net drug cost of the proposed drug exceeds the net drug cost of the originally prescribed drug
  • The originally prescribed drug has a generic equivalent and the proposed drug does not
  • The originally prescribed drug’s patent is expected to expire within six months
  • The patient was switched from a similar drug within the last two years
The settlement is the third between states and pharmaceutical benefits managers. In 2004, a group of 20 of states settled with Medco Health Solutions, Inc., the world’s largest pharmaceutical benefits manager. In February 2008, 29 states settled with Caremark Rx, LLC, another of the world’s largest pharmaceutical benefits managers.

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