US PBM pays $38.5M to settle rebate dispute

A pharmacy benefit manager has agreed to settle a law suit brought by health care payers across the USA, following accusations it failed to pass on discounts it negotiated with brand-name drugmakers, while encouraging physicians and patients to switch medications. CVS Caremark will pay $38.5 million, including legal costs, to 28 states and Washington DC, according to a report in the San Francisco Chronicle.

Specifically, the plaintiffs alleged that the firm had kept discounts or rebates that were supposed to be passed on to payers. The PBM has denied the claims, insisting that "there has been no finding of wrongdoing or inappropriate business conduct" on the part of CVS Caremark.