Attorney General Charity Clark has filed a lawsuit against pharmacy benefit managers Evernorth, owner of Express Scripts, and CVS, along with nearly two dozen affiliated entities. The suit alleges that these companies have unfairly and deceptively driven up prescription drug prices in Vermont. Pharmacy benefit managers (PBMs) act as intermediaries who negotiate contracts with pharmaceutical manufacturers, insurance companies, and pharmacies, determining the cost of prescription drugs for consumers.
The Attorney General’s lawsuit claims these companies violated Vermont’s Consumer Protection Act by manipulating the marketplace and reducing access to certain prescription drugs, including lower-cost options, through non-transparent tactics. "While the pharmacy benefit managers named in our lawsuit claim they perform their services on behalf of their clients and patients to lower prescription drug prices and promote patient health, that is just not true," said Attorney General Clark. "Instead, they have distorted the market to line their own pockets at the expense of Vermonters. My office is suing to bring transparency to prescription drug pricing and to hold these pharmacy benefit managers accountable."
Prescription drug prices have risen significantly over the last decade, partly due to a complex business model designed by PBMs. In Vermont, Evernorth and CVS dominate approximately 95 percent of the commercial market. Consequently, they influence nearly every prescription transaction and control pricing, dispensing, and reimbursement systems.
The complaint alleges that PBMs are incentivized to prioritize high-payment drugs from manufacturers with elevated list prices while excluding lower-cost alternatives from their formularies. They determine which drugs are covered by health insurance plans and require payments from drug manufacturers disguised as rebates and fees.
Additionally, PBMs allegedly prevent access to lower-priced drugs by excluding them from formularies. A New York Times investigation highlighted an incident where a cancer patient in Illinois paid significantly more for her pain medication because a PBM required her to use a more expensive version.
Further driving up costs, PBMs often mandate that patients with chronic or serious illnesses fill prescriptions through their own in-house pharmacies while restricting access to less expensive drugs. This practice harms both consumers and local pharmacies.