Express Scripts will pay a $1.5 million administrative penalty following an investigation by the West Virginia Offices of the Insurance Commissioner. The agency's probe included a review of the pharmacy benefit manager's reimbursement practices, pharmacy audits, consumer appeals and network adequacy from early 2023 to mid-2024.
Failure to reimburse West Virginia pharmacies at the minimum required rates and improper recoupment of funds from pharmacies were among the 28 violations cited. More than 20,500 claims and 191 instances in which reimbursement for a 30-day supply fell below the state-mandated $35 minimum were identified in the report. In addition, Express Scripts was found to have violated review timelines in all consumer appeals reviewed and delayed responses to 50 information requests.
Although the PBM did not admit liability, it agreed to reimburse pharmacies with interest and revise internal policies to comply with West Virginia law. It will submit a corrective action plan and report progress to the state within 90 days.
Last month, the Federal Trade Commission and Express Scripts reached a settlement that removed the company from the agency's lawsuit against leading PBMs for allegedly inflating the cost of insulin in the United States.
"The FTC's settlement with ESI will end its business practices that have kept drug prices high, ultimately providing meaningful financial relief to American patients who depend on ESI to access life-sustaining prescription drugs, as well as community pharmacies, who will see new revenues each year and relief from being squeezed," Chairman Andrew N. Ferguson said at the time.
The agreement, which included major reforms to Express Scripts' business practices, may have increased pressure on Optum Rx and Caremark to also consider a settlement. The case is now styed until late March to allow negotiations to continue, according to an order issued on Tuesday. The FTC sued Express Scripts, along with Optum Rx and Caremark, in September 2024, arguing that the PBMs' negotiating practices with drugmakers led them to prefer higher-cost drugs, which drove up the cost of insulin.
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