Community Pharmacists File Class Action Against CVS, Caremark

A class action lawsuit has been filed by the National Community Pharmacists Association against CVS Health, Caremark, according to an article by Drug Topics. The goal, according to the plaintiffs, is to “recoup for independent pharmacies millions of dollars” in what their lawyers call “wrongful back-end penalties for Medicare Part D prescriptions. The penalties they refer to are known as pharmacy direct and indirect remuneration (DIR) fees.

The lawsuit, filed by Berger Montague PC and Cohen & Gresser LLP, claims that Caremark, which is the largest pharmacy benefit manager in the country, as well as a subsidiary of CVS Health, has “been assessing pharmacy DIR fees in violation of federal antitrust laws and state laws governing contracts.”

A CVS spokesperson calls the allegations meritless and says the company plans to defend itself.

In 2021 and 2022, $25 million was awarded to litigants against Caremark after arbitrations. Two district courts confirmed these awards. According to NCPA, Caremark has done nothing other than modify its dispute resolution process to make it more expensive for pharmacies to bring claims.

A spokesman claims the arbitration process keeps litigants’ successful cases secret. It is hoped the lawsuit helps bring the DIR fees into public view. Those fees have risen 107,400 percent in recent years, making community pharmacies untenable financially.

The complaint makes several claims, among them: a tying claim under federal antitrust law based on CVS Caremark denying pharmacies access to its network of Medicare Part beneficiaries unless the pharmacies pay fees for the “opportunity” to provide other performance-related services, the so-called DIR fees; a claim for a declaratory judgment that the DIR fees are unconscionable.