Louisiana Attorney General Liz Murrill announced on June 24 that she has filed three separate lawsuits against pharmacy chain CVS, accusing it of engaging in unfair, deceptive, and unlawful practices that have “harmed Louisiana patients, independent pharmacies, and the public at large.”
The lawsuits were filed against CVS Health Corp, CaremarkPCS Health LLC, and their affiliated entities in central Louisiana’s St. Landry Parish.
Murrill said Louisiana is seeking both injunctive relief and restitution.
One of the complaints alleges that CVS’s pharmacy benefit management (PMB) unit, CVS Caremark, “controls multiple, interlocking stages of the pharmaceutical supply and reimbursement chain—from insurance to drug pricing, to pharmacy distribution and dispensing.”
PBMs serve as middlemen, negotiating prescription drug prices with manufacturers on behalf of employers and health plans, and setting the terms for how they are distributed to customers.
Murrill’s lawsuit alleges CVS has used its market power and vertical integration design to drive up drug prices to more than what they would be in a properly functioning competitive market.
“CVS and other PBMs continue to hide behind various confidentiality clauses to cover up the way they are manipulating drug prices—it’s wrong and unlawful. CVS will have to account for its actions,” Murrill said in a statement.
A second lawsuit alleges the company’s business practices with independent pharmacies of Louisiana constitute unfair competition, are “deceptive and substantially harmful to the public,” and are in violation of state regulations.
“Specifically, CVS’s abuse of its enormous market power to impose unethical and exceedingly high fees on independent pharmacies—under threat of being expelled from the CVS network—amounts to unfair competition and unfair trade practice,” Murrill’s office said in a statement.
“CVS is abusing its enormous market power to engage in covert spread pricing to further enrich itself at the expense of the independent pharmacies in its network.”
The third lawsuit alleges CVS illegally used customers’ personal information to send them text messages opposing a proposed bill that, if it had become law, would have banned companies from owning both PMBs and drug stores in the state.
“I believe CVS used their customers’ personal information that was given to them to fill their prescription, to lobby for their own corporate interests against pending legislation in the State Legislature,” Murrill said in a statement.
She said the company sent the messages to “large numbers of state employees and their families,” adding that this was “not an appropriate use of personal information obtained through a state contract.”
At the time, a CVS spokesperson told The Epoch Times that the bill came together “with no public hearing” and that the company believed it “had a responsibility to inform our customers of misguided legislation that sought to shutter their trusted pharmacy, and we acted accordingly.”
“Our communication with our customers, patients, and members of our community was consistent with law,” the spokesperson said.
After the lawsuits against CVS were announced, the pharmacy chain told The Epoch Times in an emailed statement that it should not have to pay higher rates for “less efficient pharmacies,” and that this would lead to “higher costs for consumers.”
“Importantly, CVS Pharmacy remains the lowest cost pharmacy and a critical partner in lowering prescription drug costs for Louisianans,” the company said.
The company added that its business structure allows for “better access, affordability, and advocacy for those we serve” and that removing CVS pharmacies from Louisiana would increase costs to the state by more than $4.6 million.
