The CVS Pharmacy logo is seen in Washington, DC, USA on July 9, 2024.
Jakub Bolzycki | Noor Photos | Getty Images
CVS Health, UnitedHealth Group and Cigna on Tuesday sued the Federal Trade Commission, claiming the agency’s lawsuit against drug supply chain middlemen over high U.S. insulin prices was unconstitutional.
The complaint, filed in the U.S. District Court for the Eastern District of Missouri, is the latest step in a fierce legal battle between the country’s three largest pharmacy benefit managers (PBMs) and the Federal Trade Commission (FTC).
In September, the FTC sued CVS’s Caremark, Cigna’s Express Scripts and UnitedHealth’s Optum Rx in the agency’s administrative court, accusing these PBMs and other drug middlemen of using an “unfair” rebate system to boost profits while inflating Americans. cost of insulin.
The FTC’s internal administrative proceedings brought the case before the administrative law judge presiding over the case. FTC commissioners then vote on the opinion.
Tuesday’s complaint alleges that the FTC’s proceedings violated the company’s due process rights under the Fifth Amendment. The companies also argue that the FTC claims involve private rights and must be litigated in federal court rather than the agency’s internal administrative courts.
The companies called the process “fundamentally unfair” and argued that commissioners and administrative law judges are “unconstitutionally immune from presidential removal and, therefore, from democratic accountability.”
“This sweeping attempt to reshape an entire industry through enforcement will never make it to the U.S. District Court,” the complaint states.
“It has become fashionable for corporate giants to argue that a 110-year-old federal agency is unconstitutional in order to distract from concerns about business practices,” FTC spokesman Douglas Farrar said in a statement Tuesday. Attention, we claim that in the case of PBMS, these business practices harm patients in the following ways: Forcing them to pay huge sums for life-saving drugs does not work.
PBMs are at the center of the U.S. drug supply chain, negotiating rebates with drug manufacturers on behalf of health plans, reimbursing pharmacies for prescription costs and creating lists of drugs covered by insurance.
A month ago, CVS, UnitedHealth Group and Cigna asked FTC Chairman Lina Khan and two other commissioners to recuse themselves from the agency’s internal proceedings. In separate motions, the companies argued that all three commissioners have extensive records of making public statements that demonstrate alleged serious bias against PBM.
Caremark, Express Scripts and Optum Rx are all owned or affiliated with health insurance companies and together manage about 80% of the nation’s prescription drugs, according to the FTC.
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