Ohio Attorney General Sues Express Scripts and Prime Therapeutics For Price Fixing

Ohio Attorney General Dave Yost has sued Express Scripts and Prime Therapeutics, saying they drive up drug prices and ultimately push those higher costs onto patients. In a suit¹ filed Monday, Yost alleges there were multiple violations of the Valentine Act, Ohio’s antitrust law, which prohibits price fixing, controlled sales and other agreements that restrain trade and hurt competition.

Specifically, Yost has accused Express Scripts and Prime Therapeutics of collusion. Express Scripts formed the group purchasing organization Ascent Health Services in 2019 to take over the company’s pricing and rebate negotiations with drug manufacturers. Later that year, Prime Therapeutics invested in Ascent and relocated Ascent operations from St. Louis to Switzerland. At the time, Prime executives said² the collaboration aimed to deliver value by “enhancing pharmacy networks and pharmaceutical manufacturer value."

“Both drug buyers and sellers have little choice but to play the game by the PBMs’ rules, allowing PBMs to extract both monopoly profits from individuals and monopsony profits from the market,” Yost said in a press release.

The suit alleges that Express Scripts, Prime and Prime customer Humana Pharmacy Solutions are able to share drug pricing and rebate information, fix prices, and increase prices for insulins, biologics and cancer drugs. Humana joined the group in 2021. The suit alleges that Express Scripts and Prime moved their rebate and discount to Ascent to conceal the pricing and rebates and that they have acted in concert when negotiating with pharmaceutical companies.

A spokesperson for Prime said the company does not comment on pending litigation. But she added that "Prime is a minority owner of Ascent, which is a group purchasing organization that negotiates pharmaceutical relationships and savings opportunities for the purpose of improving affordability for members and plan sponsors across Prime’s client base, including Prime’s Blue Cross and Blue Shield owners."

In addition to Express Scripts, Prime Therapeutics, Ascent and Humana Pharmacy Solutions, Yost’s lawsuit names as co-defendants:

• Cigna Group, parent company of Express Scripts
• Evernorth Health, another subsidiary of Cigna
• Humana, parent company of Humana Pharmacy Solutions

Nearly 40% of people in Ohio are covered by Express Scripts. The suit says that the prices that result from Express Script formulary placement create a financial burden for patients, especially those in high-deductible plans whose out-of-pocket costs are calculated as a percentage of pharmaceutical companies’ list price.

Yost’s lawsuit aims to halt what it calls anticompetitive tactics. It also seeks statutory fines and disgorgement of the ill-gotten profits.

This article originally appeared in Formulary Watch.

References

1. Yost sues Express Scripts, Prime Therapeutics and 5 others, blaming exorbitant drug prices on their collusion. Press release. Dave Yost. March 27, 2023. Accessed March 30, 2023. https://www.ohioattorneygeneral.gov/Media/News-Releases/March-2023/Yost-Sues-Express-Scripts-Prime-Therapeutics-and-5

2. Express Scripts and Prime Therapeutics collaborate to deliver more affordable care to more than 100 million Americans. Press release. Prime Therapeutics. December 19, 2019. Accessed March 30, 2023. https://www.primetherapeutics.com/news/express-scripts-and-prime-therapeutics-collaborate-to-deliver-more-affordable-care-to-more-than-100-million-americans/