Class-action suit targets Anthem, Express Scripts pact

handshake in front of money

A class-action lawsuit filed against Anthem and Express Scripts accuses them of brokering an agreement that left beneficiaries paying inflated co-pays for prescription drugs, adding a new wrinkle to an ongoing dispute between the two companies.

Plaintiffs from three different employers that sponsored medical plans though Anthem and Express Scripts allege the coverage providers violated the Employee Retirement Income Security Act (ERISA), a federal law that requires health plans to act in the best interest of beneficiaries.

According to the compliant, when Anthem agreed to a $4.675 billion 10-year contract with Express Scripts in 2009, it opted for a deal in which the pharmacy benefits manager (PBM) would pay more money up front, but charge higher prices for drugs over the course of the agreement. Anthem used that initial payment to buy back stock, “which ultimately enriched Anthem’s stockholders and management,” rather than passing the money toward plan participants.

The plaintiffs suggest Express Scripts also violated the federal statute by raising drug prices above competitive benchmark prices. The lawsuit cites a third-party analysis that found the PBM overcharged Anthem by as much as $3 billion each year, leading to an estimated $15 billion in overpayments over the course of the agreement. As a result, plan participants were left paying “significantly higher” percentage-based co-pays.

The details of the class-action suit mirrors Anthem's claim earlier this year that Express Scripts owed the insurer $3 billion in annual prescription drug savings. Months later, Anthem filed a lawsuit against the PBM seeking damages and the right to terminate a contract that runs through 2019. Express Scripts denied the allegations and responded with a counter-suit accusing Anthem of violating the terms of their contract.  

To learn more:
- here’s the complaint