Andrew Rubin, Esq.

Anthem sues Express Scripts, alleges breach of contract

Some New Jersey residents may be familiar with Anthem as a medical insurance provider in some Blue Cross- Blue Shield health insurance policies. It has been reported that Anthem has filed a lawsuit against Express Scripts, which is a company that acts as a pharmacy benefits manager.

Anthem has a contract with Express Scripts for the company to run Anthem's prescription drug coverage. According to Anthem, Express Scripts has been charging the insurer higher drug prices than what are competitive, a practice that Anthem claims is against what is called for in the contract.

Express Scripts released a statement indicating that it has negotiated in good faith and that Anthem's lawsuit is meritless. Pharmacy benefits companies such as Express Scripts run plans by using their large size in order to negotiate prices. Anthem provides health insurance coverage to 38.6 million people across the country. In 2009, it sold its own pharmacy management business to Express Scripts. While the two have been working together since the sale, the relationship has not always been a good one. Previously, the two companies were involved in a contract dispute in 2011 with the possibility of litigation raised.

Breach of contract claims may arise in highly complex contracts such as the one between Anthem and Express Scripts. These types of contracts often involve several millions of dollars, meaning the stakes are very high for the involved parties. In many cases, the parties are often able to resolve such disputes through negotiation handled by their respective attorneys. When a dispute cannot be resolved in that way, it may have to be handled in arbitration, if the contract requires it, or in a courtroom.

Source: New Jersey Herald, "Anthem slaps lawsuit on Express Scripts over drug pricing," March 21, 2016

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