The complaint alleges that CVS Caremark illegally used a loophole in Medicare regulations to exponentially increase certain fees and to force independent pharmacies to pay CVS Caremark to provide certain “performance-related” services on unreasonable terms.
The complaint also alleges CVS Caremark imposes terms that are so one-sided that no pharmacy would rationally enter into them. But because CVS Caremark is the country’s largest Pharmacy Benefits Manager (PBM) and controls access to Medicare Part D beneficiaries, CVS Caremark was able to force independent pharmacies to accept the unreasonable terms.
The complaint also alleges that CVS Caremark exercises its discretion in applying performance standards in bad faith to disadvantage pharmacies, and that certain terms of its contracts are unconscionable.
The complaint was filed in the Western District of Washington. Berger Montague LP will serve as Cohen & Gresser’s co-counsel, while Terrell Marshall Law Group PLLC is serving as local counsel.