Express Scripts to pay $9.3 million in settlement

One of the nation’s largest pharmacy benefits management companies was ordered to pay a total of $9.3 million to 29 states, including North Carolina, Attorney General Roy Cooper announced Tuesday in a release.

As part of the settlement, Express Scripts, Inc. will pay $9.3 million to the states and up to $200,000 to reimburse patients who paid too much because of switches between cholesterol-controlling drugs. North Carolina will receive nearly $300,000 from the settlement, according to the release.

The settlement resolves charges by the states' attorneys general that Express Scripts used deceptive business practices to encourage doctors to switch patients to different brand name prescription drugs.

The states allege that Express Scripts represented that patients and/or health plans would save money because of the drug switch but that the company did not adequately inform doctors that patients might actually pay more for the new drug. The company also did not clearly disclose that it would keep rebates earned by switching drugs rather than passing them along to health plans, the release said.

“Patient health should come first when it comes to choosing the right prescription drug,” Cooper said in the release. “Pushing people to switch to a more expensive drug just to boost profits is flat out wrong.”

Pharmacy benefit management companies enter into contracts with employers and government health plans to process prescription drug claims. They also negotiate with drug companies and pharmacies to obtain discounts and dispense drugs through their mail order pharmacies.

Under the settlement, Express Scripts is generally prohibited from encouraging people to switch drugs when:

Patients will pay more for the new drug than they paid for the original drug;

The original drug has a generic equivalent and the proposed drug does not;

The original drug’s patent is expected to expire within six months; or

The patient was switched from a similar drug within the last two years.

Express Scripts will also be required to: Inform patients and doctors what effect switching drugs will have on a patient’s co-payment;

Inform doctors that Express Scripts makes money off of certain drug switches, and tell them about important differences in side effects or effectiveness of the drugs;

Reimburse patients for out-of-pocket expenses for health care costs related to switching drugs, and notify patients and their doctors that reimbursement is available;

Get authorization from a patient’s doctor for all drug switches;

Inform patients that they may decline to switch drugs and tell them the conditions for continuing to get their originally prescribed drug;

Monitor the effects of drug switches on patients’ health; and

Refrain from making any unsubstantiated claims that a drug switch will save money.

The settlement with Express Scripts is the third that states have entered into with such companies in recent years. In 2004, North Carolina joined 19 other states in a settlement with Medco Health Solutions, Inc., the world’s largest pharmaceutical benefits manager. In February of 2008, North Carolina and 28 other states settled with Caremark Rx, LLC, another of the largest such firms.