The lawsuit cites numerous alleged examples of thedefendants and their agents taking clawback and/or so-called spreadpayments thousands of times each day from pharmacies across thecountry. (CIGNA headquarters in Bloomfield, Connecticut. Photo,Michael Nagle.)

A federal judge in Connecticut has denied most ofCigna Health and Life Insurance's claims in its request todismiss a lawsuit which alleges it artificially inflated prescription drug costs in violation of thehealth insurance policies of its clients.

The Monday ruling by U.S. District Judge Warren Eginton meansthe class-action lawsuit against both Cigna and OptumRxInc. will move forward. The insurance giant hired OptumRx asits pharmacy benefits manager to negotiate drugprices on behalf of Cigna and the Cigna network.

The October 2016 lawsuit, filed on behalf of five individualswho were covered by Bloomfield-based Cigna,alleges the two companies conspired over several years to makeconsumers pay higher prices for prescriptiondrugs. The defendants allegedly misrepresented the costs of thedrugs through increased charges to patients and then“clawbacks” to get a larger portion of patients'payments.

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In his ruling, Eginton, who presides in Bridgeport, wrote, inpart: “The court finds the plaintiffs have plausibly alleged morethan an entitlement to lower-cost prescription drugs or breach ofcontract. … The complaint plausibly alleges the defendant CIGNAacted with scienter by alleging that it intentionally sought tocharge excess amounts for prescription drugs and that it requiredthe pharmacies to conceal from the insureds the amounts of theprescription drug costs.”

The lawsuit claims violation of the Employee Retirement IncomeSecurity Act and violation of the Racketeer Influenced and CorruptOrganization Act against both defendants. Eginton denied the motionto dismiss most claims, but did dismiss the RICO claim againstOptumRx, while keeping the RICO claim against Cigna.

The lawsuit cites numerous alleged examples of the defendantsand their agents taking clawback and/or so-called spread paymentsthousands of times each day from pharmacies across the country.Examples cited in the lawsuit show a class member in November 2014paid a pharmacy a $20 co-payment for the prescription drugAmlodipine Besylate, 1,043 percent more than the actual $1.75 feepaid to the pharmacist. Without disclosing it to the consumer, thelawsuit alleges, the defendants clawed back the $18.25overcharge.

In another cited case, a class member, also in November 2014,paid a pharmacy a $20 co-payment for the prescription drugClopidogrel, a 468 percent premium over the actual $3.52 fee paidto the pharmacist. Again without disclosing it to the customer,defendants clawed back the $16.48 overcharge, the lawsuitstates.

Craig Raabe, a partner with Izard, Kindall and Raabein West Hartford and attorney for the plaintiffs, called Eginton'sdecision, “A great ruling for consumers. We now look forward togoing into the discovery phase.”

That phase, Raabe told the Connecticut Law Tribune Tuesday,should determine “the mechanism and scope of the overcharges.Discovery will also determine how much in overcharges there havebeen and how many people were overcharged. We are seekingreimbursement for the class for all of the overcharges.”

Raabe said his office became involved in the case after gettinga call from a client. “We received a complaint about drugovercharges, investigated the issue thoroughly and discovered theovercharge scheme set forth in the complaint,” he said.

Cigna is represented by Brian Shaffer of Morgan, Lewis &Bockius in Philadelphia. Shaffer did not respond to a request forcomment Tuesday.

OptumRx, a subsidiary of the Minnesota-based United Health Care,is represented by Michelle Grant of Dorsey & Whitney inMinnesota. Grant also did not respond to a request for comment.

The five plaintiffs are Kimberly Negron, Daniel Perry, CourtneyGallagher, and Nina and Roger Curol. The plaintiffs are from fourstates: Massachusetts, New Jersey, Washington and Louisiana.