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Breaking News Judge Hands Pharmacy a Defeat in ESI/Medco Merger Case 9.4.12
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IACP Breaking News


Judge Hands Pharmacy a Defeat in ESI/Medco Merger Case

September 4, 2012 -- Late last week, before the Labor Day holiday weekend, U.S. District Court Judge Cathy Bissoon dismissed antitrust claims from retail pharmacy advocates that permitting the Express Scripts and Medco merger to go forward would harm community pharmacies and large employers.  NCPA, NACDS and pharmacies sued to stop the merger, claiming that an ESI/Medco combined company would result in the largest pharmacy benefits manager in the U.S., controlling and limiting access to prescription medication for 155 million people. 

Judge Bissoon, however, dismissed without prejudice claims that lowered reimbursement rates the plaintiffs expect as a result of the merger would result in lowered output and reduced quality of retail pharmacy services, ruling that the plaintiffs failed to persuade her that retail pharmacies would suffer actual injury.

“Plaintiffs ... do not allege injury merely based on increased efficiencies or competition. Instead, they allege that merged defendants will use their increased market power to force consumers away from plaintiffs’ specialty pharmacy businesses, and into their own mail-order and in-house specialty pharmacies,” Judge Bissoon said. “As a result, defendants’ argument that plaintiffs allege injury with respect to this claim based merely on ‘too much competition’ is unpersuasive.”

She also dismissed claims made in the suit as providers of nationwide PBM services to large private employers, ruling that the plaintiffs “do not identify a single member who qualifies as a large private employer” in leveling the charge.  “It is impossible to determine whether plausible allegations of such injury exist if the complaint fails to identify a single plaintiff who claims to be so injured,” she said.

Pharmacies have until September 10, 2012 to file a new complaint.  To read Judge Bissoon’s decision, click here.


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