Community pharmacies file suit to block merger of Express Scripts, Medco

March 29, 2012

The National Association of Chain Drug Stores (NACDS), the National Community Pharmacists Association, and 9 retail pharmacy companies filed a lawsuit Thursday to stop the proposed merger of pharmacy benefit manager giants Express Scripts and Medco Health Solutions.

The National Association of Chain Drug Stores (NACDS), the National Community Pharmacists Association (NCPA), and 9 retail pharmacy companies filed a lawsuit Thursday to stop the proposed merger of pharmacy benefit manager (PBM) giants Express Scripts and Medco Health Solutions.

The suit was filed only a day after Express Scripts announced on its website that the $29.1 billion deal could be completed as early as next week.


“A merger of Express Scripts and Medco would have dire consequences for patients and the retail community pharmacies that serve them,” according to a joint statement issued by NACDS President and CEO Steven C. Anderson, IOM, CAE, and NCPA CEO B. Douglas Hoey, RPh,

Businessweek reported that Express Scripts spokesman Brian Henry declined to comment on the lawsuit. Medco spokesperson Jennifer Luddy said in an e-mail to Businessweek, “We stand by our recent 8K filing, in which we stated that we expect the merger to be completed as early as the week of April 2, 2012.”

The lawsuit was filed in the U.S. District Court for the Western District of Pennsylvania.

The other 9 plaintiffs in the suit are community pharmacy companies that are either based in Pennsylvania or do business there.

“Forcing patients to use mandatory mail-order pharmacies and denying them access to their local community pharmacist even causes some patients to discontinue drug therapy prematurely,” the plaintiffs allege in the lawsuit.

According to a news release, the plaintiffs also argue that the merged company would reduce:

• Access and service to patients.

• Competition for PBM services, particularly to large plan sponsors.

• Competition for specialty pharmaceutical services.

• Competition in mail-order services, allowing the combined entity to raise mail-order prices and drive business to their own mail-order pharmacies regardless of patient preference.

Express Scripts said on its website that it believes that the merger with Medco will complement its core competencies, will be enhanced with Medco’s specialty pharmacy platform, will add additional mail-order capabilities, and has significant synergy potential.