The lawsuit could open up PBMs across the country to potential settlements as well as court orders meant to change the way the drug industry operates. (Photo: Shutterstock)
They'd been out of the fight over the widespread use and abuse of opioids, but that could be about to change. Pharmacy benefit managers are being targeted by a lawsuit filed by Webb County, in South Texas, charging that PBMs enabled the opioid crisis and profited from the sale of the drugs that fueled it, according to a lawyer who represents the county.
Stat News reports that not only does this suit, filed in January, target PBMs, but in being rolled over into a larger that aggregates claims from cities and states across the country, it could also open up PBMs across the country to potential settlements as well as court orders meant to change the way the drug industry operates.
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PBMs, the financial middlemen that determine which drugs are available and how much they'll cost patients out of pocket, provide little transparency on how they make those determinations. The Webb County lawsuit is thought by its attorneys to be the first in the country to name PBMs as defendants in a municipal opioid lawsuit.
While some experts say that because PBMs aren't publicly visible in their role, that could make it tough to prove liability for the overdose deaths and other consequences of the crisis.
"They are far more removed than manufacturers and distributors," Jodi Avergun, a former chief of staff of the Drug Enforcement Administration and now a defense lawyer with Cadwalader, Wickersham & Taft, is quoted saying in the report. Avergun adds, "PBMs play a less significant role and one that's harder to ascribe liability to under traditional tort principles."
But that's not the only expert opinion on the subject; other experts believe that legal discovery could be especially damaging for PBMs, since they hold records on the number of opioids dispensed in communities hit with huge increases in overdoses.
"It's hard for these companies to [argue] that in certain locales the volume of pills was for a legitimate medical purpose," Rebecca Haffajee, a professor of health management and policy at the University of Michigan School of Public Health, is quoted saying in the report. She adds, "The paper trail of prescriptions makes it more compelling, and those records should be disclosable."
Joanne Cicala, a lawyer who represents Webb County, says in the report that PBMs enabled the opioid crisis and profited from the sale of the drugs that fueled it. She's quoted saying, "We see them as an absolutely essential part of this scheme. They made sure these drugs were dispensed and they controlled their flow out into the communities."
According to the report, the county's suit includes claims against three PBMs that control most of the U.S. market: Express Scripts, CVS Health, and OptumRx. In addition, it names two smaller companies that also operate in South Texas, Prime Therapeutics and Navitus Health Solutions.
The suit also includes fraud, conspiracy, and racketeering charges against major drug manufacturers and wholesale distributors, which is common to many other complaints filed across the country. However, Webb County's case stands out thanks to its legal claims and language directed at PBMs, entities the suit calls "the gatekeepers to the vast majority of opioid prescriptions filled in the United States."
The PBMs aren't going down without a fight, however. The report cites an e-mailed statement from Jennifer Luddy, a spokeswoman for Express Scripts, saying that the allegations in the case are without merit. "We plan to defend ourselves vigorously," the statement says. In addition, CVS Health, Prime Therapeutics and Navitus Health Solutions all were quoted in the report saying that charges were baseless or defending their practices.
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Marlene Satter
Marlene Y. Satter has worked in and written about the financial industry for decades.
