Medco 2014 Annual Report Download - page 35

33
Express Scripts 2014 Annual Report
interveneagainsttheremainingdefendants.InJanuary2014,KesterfiledacomplaintagainstAccredoand
CuraScript,Inc.(forpurposesofthisItem3,“CuraScript”)andallegesdefendantsviolatedtheAnti-KickbackStatute,
thefederalFalseClaimsAct,andthefalseclaimsactsoftwenty-sevenstatesinconnectionwithrebatesanddiscounts
providedinvariouscontractswithNovartisinvolvingthefollowingdrugs:Exjade,Gleevec,Tasigna,andTOBI.The
complaintseeksmonetarydamages,aswellascostsandexpenses. InJune2014,thecourtenteredanordergranting
defendants’motionstodismisswithrespecttoGleevec,Tasigna,andTOBI,anddeniedthemotionswithrespectto
Exjade.InSeptember2014,thecourtdeniedCuraScriptandAccredo’smotiontodismissforfailuretostateaclaim.
FollowingthefilingofKester’samendedcomplaint,inJanuary2015,thecourtdeniedAccredoandCuraScript’s
motiontodismiss.LaterinJanuary2015,thestateofWashingtonfiledamotiontoamenditscomplaintin
interventiontoassertclaimsagainstAccredo,andAccredofiledabriefinoppositiontheretoinFebruary2015.
• ATLSAcquisition,LLC,etal.,FGSTInvestments,Inc.,etal.v.MedcoHealthSolutions,Inc.(UnitedStates
BankruptcyCourtfortheDistrictofDelaware)(adversarycomplaintfiledMarch2014).InDecember2012,Medco
soldPolyMedicaCorporationanditssubsidiaries(“PolyMedica”),includingallassetsandliabilities,toFGST
Investments,Inc.(“FGST”)inamanagementbuyouttransaction.InFebruary2013,ATLSAcquisitionLLC
(“ATLS”),theparentcompanyofFGST,FGSTandPolyMedica(ATLS,FGSTandPolyMedicaarecollectively
referredtoas“Debtors”),filedforChapter11bankruptcyprotection.InMarch2014,Debtorsfiledacomplaint
againstMedcoallegingbreachofcontract,specificperformance,indemnity,breachoffinancialstatementswarranty,
declaratoryjudgment,avoidanceoftransfersbasedonconstructiveandactualfraud,anddisallowanceand
subordinationofMedco’sclaims.DebtorsseekpaymentofPolyMedica’spre-closingtaxesandothercreditors’
claims.InMarch2014,DebtorsfiledobjectionstoproofsofclaimsfiledbyMedco.InMarch2014,Debtorsfileda
motionforpartialsummaryjudgmentastothepre-closingtaxes.InMay2014,Medcofiledananswerand
counterclaimtotheadversarycomplaint,amotiontodismisstheadversaryproceeding,andapartialcrossmotionfor
summaryjudgmentseekingreformationofthestockpurchaseagreementontheissueofpre-closingtaxes.Debtors
filedareplytoMedco’scounterclaim,anansweringbriefinoppositiontoMedco’smotiontodismiss,andabriefin
oppositiontoMedco’scrossmotionforpartialsummaryjudgmentinMay2014.InAugust2014,Debtorsfiledajoint
planofreorganization.InSeptember2014,Debtorsfiledamotionforentryofordersincludingbutnotlimitedto
approvingbidproceduresrelatedtothesaleofassets,approvingbidprotections,schedulingahearingforconsidering
sale,approvingtheassetpurchaseagreementandauthorizingthesale.TheauctionofDebtors’assetsoccurredin
November2014.
• JasonBerkv.ExpressScripts,Inc.andExpressScriptsPharmacy,Inc.(UnitedStatesDistrictCourtfortheDistrictof
Minnesota,CaseNo.0:14-cv-01008)(filedApril8,2014).AcomplaintwasfiledagainstExpressScripts,Inc.and
ExpressScriptsPharmacy,Inc.,itssubsidiary,bynamedemployee,JasonBerk,acurrentPharmacyBenefitSpecialist
employee,allegingtwocausesofaction:(1)acollectiveactionunderthefederalFairLaborStandardsAct,29U.S.C.
§216(b),forfailuretopaywagesandovertime;and(2)aFederalRuleofCivilProcedure23classactionforbreach
ofcontract.Thepartieshaveagreedtostaythelawsuitinfavorofearlyinvestigationandmediation.
• InJuly2011,MedcoreceivedasubpoenaducestecumfromtheUnitedStatesDepartmentofJustice,Districtof
Delaware,requestinginformationfromMedcoregardingitsarrangementswithAstraZenecaconcerningfourAstra
Zenecadrugs.Medcoiscooperatingwiththeinquiry.TheCompanyisnotabletopredictwithcertaintythetimingor
outcomeofthismatter.
• OnFebruary27,2014,theCompanyreceivedasubpoenaducestecumfromtheUnitedStatesDepartmentofJustice,
DistrictofRhodeIsland,pursuantto18U.S.C.Section24(a),requestinginformationregardingtheCompany’s
contractualarrangementswithPfizer,BayerEMDSeronoandbiogenidecconcerningthefollowingdrugs:Betaseron,
RebifandAvonex.TheCompanyintendstocooperatewiththeinquiryandisnotabletopredictwithcertaintythe
timingoroutcomeofthismatter.
• OnMarch31,2014,theCompanyreceivedasubpoenaducestecumfromtheAttorneyGeneralofNewJersey,
requestinginformationregardingESI’sandMedco’sarrangementswithAstraZenecaconcerningthedrugNexium.
TheCompanyintendstocooperatewiththeinquiryandisnotabletopredictwithcertaintythetimingoroutcomeof
thismatter.
• OnApril8,2014,theCompanyreceivedasubpoenafromtheUnitedStatesDepartmentofLabor,EmployeeBenefits
SecurityAdministrationrequestinginformationregardingESI’sandMedco’sclientrelationshipsfrom2009tothe
present.TheCompanyintendstocooperatewiththeinquiryandisnotabletopredictwithcertaintythetimingor
outcomeofthismatter.
• OnAugust23,2013,theCompanyreceivedafederalgrandjurysubpoenafromtheUnitedStatesAttorney’sOffice
fortheNorthernDistrictofCalifornia.ThesubpoenarequestsinformationfromJanuary1,2003tothepresent
regardingMedco’srelationshipwithAlfredVillalobos(“Villalobos”)andARVCOCapitalResearchLLC
29