Antitrust Law Daily Wrap Up, ANTITRUST NEWS: Express Scripts monopolizing specialty pharmacy services market, complaint asserts, (Apr 21, 2016)

By Greg Hammond, J.D.

Pharmacy Benefit Manager (PBM) Express Scripts, Inc. is attempting to monopolize the market for specialty pharmacy services to New Jersey residents locked into their use of Express Scripts’ PBM services, according to a complaint filed in the federal district court in Newark, New Jersey (Prime Aid Pharmacy Corp. v. Express Scripts, Inc., April 19, 2016).

PBMs manage an insurance company, health plan, or self-insured employer’s prescription drug program, according to the complaint filed by Prime Aid Pharmacy Corp., a specialty pharmacy. Prime Aid claims that Express Scripts has sought to exclude Prime Aid from Express Scripts’ network, in violation of the Sherman Act and New Jersey Antitrust Act.

In particular, Prime Aid asserts that Express Scripts has a high degree of market or monopoly power in the market for specialty pharmacy services to New Jersey insureds that are locked into its network, including the absolute power to exclude competition from that market. Express Scripts purportedly has a reasonable probability of succeeding in monopolizing the market based on its absolute control of access to the market; its elimination of competition from major independent specialty pharmacies like Prime Aid; its ability to grant collusive reciprocal rights to specialty pharmacies controlled by other PBMs while excluding all meaningful independent competition on level and quality of service; and its ability to direct lucrative specialty pharmacy business in the network to its captive or affiliated mail order and specialty pharmacies.

Prime Aid also claims that Express Scripts’ agreements with health plans, granting it exclusive rights to act as PBM for those health plans and employers—through which it has wrongfully excluded Prime Aid from its Network and foreclosed Prime Aid’s competition with its captive specialty pharmacy—comprise unlawful agreements in violation of Section 1 of the Sherman Act.

In addition to bringing claims under the Sherman Act, Prime Aid brought claims for declaratory relief, injunctive relief, and for violations of the New Jersey Antitrust Act.

The Case is No. 2:16-cv-02182-JMV-JBC.

Attorneys: Jonathan L. Swichar (Duane Morris LLP) for Prime Aid Pharmacy Corp.

Companies: Prime Aid Pharmacy Corp.; Express Scripts, Inc.

News: Antitrust