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Pharmacy benefit manager sued for pocketing millions of dollars in overcharges to state of Ohio

TiffinOhio.net Staff

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U.S. Army photo by Suzanne Ovel

Ohio Attorney General Dave Yost filed a lawsuit Monday in Franklin County Common Pleas Court against Express Scripts, accusing the pharmacy benefit manager (PBM) of multiple contract breaches that helped Express Scripts silently pocket millions of dollars in overcharges to the state.

The suit, filed on behalf of the Ohio Highway Patrol Retirement System (HPRS), seeks to recover unspecified damages from Express Scripts, which had been the PBM for HPRS’ health plans since 2010.

The lawsuit marks the second such action taken by the Ohio Attorney General’s office in the state’s ongoing investigation of the practices of PBMs, private companies that contract with state agencies – including HPRS, Medicaid and others – to manage drug prescriptions for those agencies’ clients.

The first lawsuit – filed in March 2019, also in Franklin County Common Pleas Court – centers on nearly $16 million in overcharges to the Bureau of Workers’ Compensation by OptumRx, which served as the bureau’s PBM from 2013 to 2019. That case awaits a judge’s ruling on several key motions.

The lawsuit filed today maintains that, in each year of its contract with HPRS except 2011-12, Express Scripts failed to satisfy the pricing guarantees in the then-applicable pricing schedule, thereby overcharging HPRS on thousands of claims.

“Express Scripts also repeatedly misclassified and/or continued to classify generic drugs as brand drugs,” the complaint reads. “Based on the classification, defendant Express Scripts charged higher prices on each of them because the brand drug pricing methodology was applied, which carried with it a lower pricing guarantee.”

The lawsuit cites breaches of Express Scripts’ agreement with HPRS, including but are not limited to:

  • Failing to meet the pricing discount and dispensing fee guarantees.
  • Misclassifying generic drugs as brand drugs in order to charge higher prices.
  • Overcharging for generic drugs by failing to timely adjust generic pricing lists to accurately reflect the lowest available pricing.
  • Failing to disclose its sources of remuneration received in connection with its performance of services for HPRS.

The lawsuit alleges that “breaches were committed knowingly in bad faith and with the intent to deprive HPRS of the benefit of its bargain” and that “HPRS was regularly charged commercially unreasonable prices for generic drugs throughout the term of the agreement.”

“This particular PBM egregiously charged for services it didn’t deliver,” Yost said. “Its repeated breaches cost Ohioans millions, and we want our money back.”

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