Express Scripts Sues FTC, Demands Removal of “False and Misleading” PBM Report

Express Scripts from Evernorth, a subsidiary of the Cigna group, is demanding in a trial that the Federal Trade Commission retract its recent “defamatory” report on the pharmacy benefit management industry.

The FTC’s preliminary decision report The commission detailed the power and influence that drug benefit managers (DBMs) like Express Scripts have over patients and their ability to access affordable prescription drugs. The commission alleged that DBMs enter into agreements to exclude lower-cost competitors from drug formularies in exchange for increased discounts from manufacturers.

Specifically, the FTC said the three largest PBMs processed nearly 80% of the approximately 6.6 billion prescriptions dispensed by U.S. pharmacies in 2023, while the six largest PBMs processed more than 90%. Additionally, the report found that pharmacies affiliated with the three largest PBMs accounted for nearly 70% of all specialty drug revenue.

The three largest players in the market are owned by insurers that own specialty, mail-order or retail pharmacies: Cigna owns Express Scripts, UnitedHealth owns OptumRx and CVS Health owns CVS Caremark.

Just days after the report was released in July, the FTC announcement plans to sue the three largest PBMs, including Express Scripts.

On Tuesday, the PBM fired back with its own lawsuit in federal court in Missouri, accusing the FTC of writing a report that was “unfair, biased and erroneous.” According to the lawsuit, the report is not based on data provided by the PBMs, but rather on “seventy-four pages of unsubstantiated innuendo against Express Scripts and other PBMs under a false and defamatory headline and accompanied by a false and defamatory press release.”

Andrew Nelson, Cigna’s group general counsel, called the FTC’s actions unconstitutional and offered a narrative that could harm the health care system by removing checks and balances. Nelson suggests that would lead to higher drug prices for Americans.

“We do not take this action lightly, but as advocates working to lower drug prices for millions of Americans and the employers, unions, and government agencies that provide their prescription drug benefits, we cannot allow the FTC’s illegal actions and misinformation to continue,” Nelson said in a statement.

Express Scripts says it saved about $38 billion for its customers last year, noting that drugmakers, not PBMs, set drug prices.

The Congress is foreseen to consider several bills that would require PBMs to report how much profit they make when negotiating drug prices.

In its complaint, Express Scripts singles out FTC Chairwoman Lina Khan, accusing her of anti-PBM bias since before she was appointed to the commission. The company is seeking a declaration that the FTC report is defamatory and unlawful, that it be removed from all commission websites, and that Khan be disqualified from any actions related to Express Scripts.