Retail News Breaks Archives
NACDS, NCPA press on with PBM merger opposition
April 2nd, 2012
ALEXANDRIA, Va. – The National Association of Chain Drug Stores and the National Community Pharmacists Association expressed disappointment that the Federal Trade Commission cleared the way for Express Scripts Inc. and Medco Health Solutions Inc. to close their merger and said they will push ahead with efforts to block the deal.
"NACDS and NCPA have aggressively fought this merger from day one because of its potential harm to patients and to competition. We are disappointed that the FTC did not act to protect consumers in this instance," NACDS president and chief executive officer Steve Anderson and NCPA CEO B. Douglas Hoey said in a joint statement Monday, after the FTC announced that it voted 3-1 to allow the merger transaction to proceed.
"It is worth noting that the merger proved controversial within the FTC," they stated. "We commend commissioner Julie Brill for her dissenting statement. In the end, two of four commissioners saw the need for remedies, and one of those commissioners wanted to challenge the merger in court."
The two pharmacy groups said they will continue to press ahead with their lawsuit, announced Thursday, that claims the merger violates antitrust law and should be stopped. Nine pharmacy operators also are plaintiffs in that suit.
And on Friday, NACDS, NCPA and the nine pharmacy operators filed a request for a temporary restraining order to prevent the two pharmacy benefit managers (PBMs) from finalizing their merger before a ruling on the antitrust suit.
NACDS and NCPA also reported that all the plaintiffs in those actions plan to file a motion with the court on Monday requesting that the judge direct Express Scripts and Medco to keep their assets separate pending a review of the lawsuit and/or schedule an expedited review of the merits of the case.
"We continue to believe that the compelling arguments and evidence brought to the FTC by NACDS, NCPA, consumer groups and others warrant blocking this merger. That the agency is allowing the merger to proceed, and without any conditions, leaves patients and pharmacies vulnerable to significant harm from a combined ESI-Medco," Anderson and Hoey said in their statement.
"NACDS and NCPA remain deeply concerned that this merger will reduce competition to unhealthy levels in several prescription drug markets that are already highly concentrated. These include the general PBM industry as well as the large health plan, specialty drug and mail order markets," the executives noted. "As a result, we believe this merger will lead to higher prescription drug costs, fewer choices and diminished competition in both the community pharmacy and PBM sectors.
"While the claims of savings touted by merger supporters are exaggerated and highly dubious, there is no evidence to believe that any supposed savings will be realized by patients, plan sponsors and health plans," they added.
NACDS and NCPA cited a "torrent of opposition and concern" about the PBM merger from community pharmacies, leading consumer advocacy groups and small businesses, as well as 77 members of Congress who have written to the FTC to express their concern and over 30 state attorneys general offices that have been scrutinizing the deal.
The two drug store associations also said the FTC decision "strengthens the case" for several bills in Congress that would safeguard patient choice and level the playing field in pharmacy services, including the Pharmacy Competition and Consumer Choice Act (S. 1058 / H.R. 1971), the Preserving Our Hometown Pharmacies Act (H.R. 1946) and the Medicare Pharmacy Transparency and Fair Auditing Act (H.R. 4215).
"NACDS and NCPA also will continue to closely monitor the combined entity," Anderson and Hoey stated. "We will not hesitate to bring any anticompetitive conduct to the attention of the appropriate government authorities and the courts to ensure that patients, plan sponsors and pharmacies interests are protected."
Also on Monday, Preserve Community Pharmacy Access NOW! (PCPAN) — a coalition of consumers, businesses and community pharmacists formed to oppose the Express Scripts-Medco merger — gave a thumbs-down to the FTC vote approving the deal.
"I am extremely disappointed by the commission's decision to allow this deal to move forward without taking any steps to safeguard against the competitive harm that will result," PCPAN chair Eva Clayton, a former member of the House of Representatives (D., N.C.)," said in a statement.
"The reality is the merger of these two multibillion dollar companies will give the combined entity tremendous power in the health care marketplace, enabling them to squeeze the health care system for their own profits — at the expense of patient choice, access and service," she explained. "It will result in a virtual monopoly that will lead to higher health care costs and reduced access to cheaper generic drugs, lifesaving specialty medications and vital community pharmacy services."
Clayton added that litigation may still provide an avenue for halting the merger. "The Federal Trade Commission is not the final word on this dangerous merger; rather, the law and the courts are," she stated. "We encourage the state attorneys general who have been scrutinizing the merger to take the very necessary step, which the Federal Trade Commission failed to take, and move immediately to ask the courts to stop it."