Express Scripts is one of three companies that control almost 80% of the drug market in the US
Express Scripts (CI), a subsidiary of the Cigna $CI Group and one of the largest pharmacy benefit managers (PBMs) in the U.S., filed a lawsuit Tuesday morning against the U.S. Federal Trade Commission (FTC) over a July report by the agency that claimed that the PBM industry is hiking drug prices.
In the lawsuit, which was filed in federal court in the Eastern District of Missouri, Express Scripts claimed the Commission’s report was “unfair, biased, erroneous, and defamatory” and is demanding that it be retracted.
“The FTC has taken unconstitutional actions in publishing a report that ignores the evidence provided by our company and other PBMs, demonstrates clear ideological bias and advances a false and damaging narrative – a narrative that could harm the health care system by removing essential checks and balances which would result in higher drug prices for American consumers,” said Andrea Nelson, Chief Legal Officer for The Cigna Group, in a statement.
The FTC told Quartz that it stands by its study.
“Just three companies control nearly 80% of the market that millions of Americans must use to purchase necessary drugs at high costs,” FTC spokesman Douglas Farrar said in a emailed statement to Quartz. “This is a complicated and opaque market, and the FTC is committed to using its clear authority to help the public and policymakers understand it.”
PBMs are meant to be third-party companies that work as middlemen between drugmakers and insurance providers, however their outsized power to set drug prices for millions of Americans has come under scrutiny from not just the FTC, but also lawmakers.
The FTC said in its report that “increasing vertical integration and concentration has enabled the six largest PBMs to manage nearly 95 percent of all prescriptions filled in the United States.”
Resulting in a system in which “vertically integrated PBMs appear to have the ability and incentive to prefer their own affiliated businesses, creating conflicts of interest that can disadvantage unaffiliated pharmacies and increase prescription drug costs.”
FTC Chair Lina M. Khan said the findings show that the middlemen are “overcharging patients for cancer drugs,” bringing them additional revenue of more than $1 billion.
Express Scripts is alleging that the FTC’s report disregarded documents and data provided by the company and other PBMs, resulting in the report having false and misleading claims.
“The Commission’s Report followed prejudice and politics, not evidence or sound economics, and wrongly concluded that PBMs inflate drug costs and harm independent pharmacies,” the lawsuit reads. “Express Scripts’ business and reputation have been harmed by the Commission’s unlawful, unconstitutional, and arbitrary and capricious conduct and defamatory statements.”
- Ben Kesslen contributed to this article.
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