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Oklahoma Attorney General files lawsuit against CVS Caremark for ‘below-cost reimbursement’

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Oklahoma Attorney General files lawsuit against CVS Caremark for ‘below-cost reimbursement’

By Emma Murphy
Oklahoma Attorney General files lawsuit against CVS Caremark for ‘below-cost reimbursement’
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Oklahoma Attorney General Gentner Drummond sued CVS Caremark Tuesday, alleging that the company is under reimbursing pharmacies for prescription drugs. A CVS store is pictured. (Photo by Lynne Terry/Oregon Capital Chronicle)

OKLAHOMA CITY — Attorney General Gentner Drummond sued CVS Caremark Tuesday in an Oklahoma administrative court alleging that the company is under reimbursing pharmacies for prescription drugs. 

The lawsuit alleges CVS Caremark reimbursed Oklahoma pharmacies below the actual cost to acquire the drugs about 200 times between May and October 2024. Drummond said more unreported violations are possible. 

The state’s complaint asks the Oklahoma Office of Administrative Hearings to censure, suspend or revoke the licenses of the CVS Caremark and assess fines between $100 and $10,000 per violation. 

Drummond, who has been tasked by lawmakers to enforce regulations for pharmacy benefit managers, said the lawsuit has the potential to recover $2 million in fees and restitution for pharmacies and is the first of many expected to be filed in the coming weeks. 

CVS Caremark is a pharmacy benefit manager, or PBM, that works to negotiate prices between insurance companies, drug manufacturers and pharmacies. CVS Caremark operates under the parent company CVS Health. 

“CVS Caremark delivers value daily to our Oklahoma clients and their members. We are reviewing the allegations in the complaint and will respond to them in due course,” said Phillip Blando, a spokesperson for CVS Health, in a statement.

Drummond said during a Senate committee meeting Wednesday that his office has received over 3,100 complaints about multiple pharmacy benefit managers operating in the state. The major areas of complaint include unfair reimbursement, unlawful and burdensome fees and lack of a “reasonable appeal mechanism,” he said. 

He said in a statement that pharmacies have lost thousands of dollars to fill the prescriptions and get medication to patients. 

“Oklahoma is seeing a rise of independent pharmacy closures due to PBM practices, leaving vulnerable populations throughout Oklahoma without access to central health care,” Drummond said. “And this creates both job losses and other negative economic impacts, especially in the rural part of our state.”

Drummond’s office requested a formal hearing before the administrative court.