Anthem Sues Express Scripts Over Drug Prices, Operations Issues

According to reports, the dispute centers on the terms of a repricing provision in the current contract.

Two healthcare giants—the insurer Anthem and the pharmacy benefits manager Express Scripts—are in court today after Anthem filed suit against its vendor, seeking damages for “pharmacy pricing that is higher than competitive benchmark pricing.”

Anthem’s suit also seeks damages related to operational issues and asks for the right to end its contract with Express Scripts, according to a statement from Anthem. However, the statement added, “Anthem has not made any decision whether to end its contract with Express Scripts at this time.”

The suit was filed in US District Court in the Southern District of New York.

Express Scripts said the giant PBM, the nation’s largest, believed the Anthem suit “is without merit,” according to a statement from a company spokesman, Brian Henry.

“Express Scripts values its relationship with Anthem and will continue to honor its commitments under the contract, as we would do with any client. Express Scripts has consistently acted in good faith and in accordance with the terms of its agreement with Anthem,” the statement said.

According to Reuters, Anthem has been seeking $3 billion in annual savings through a repricing provision in its 10-year deal with Express Scripts. Express Scripts agreed that the contract called for a repricing provision, which took effect January 1, 2016, but Express Scripts does not agree it owes $3 billion. The contract runs through 2019.

Seeking Alpha reported that Express Scripts' George Paz said he had "no clue" where Anthem derived the $3 billion figure.

The repricing provision would allow Anthem to avoid paying too much for drugs based on market prices.

Escalating prescription drug costs have captured the attention of leading presidential candidates and members of Congress. Discounts negotiated by PBMs like Express Scripts are intended to be passed on to payers and ultimately the consumer.