Medco 2014 Annual Report Download - page 90

Express Scripts 2014 Annual Report
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resolutionofoneormoreofsuchmatterscouldhaveamaterialadverseeffectonourresultsofoperationsinaparticular
quarterorfiscalyear.
SubsequenttotheMerger,wehaveexperiencedanincreaseinthenumberofinquiries,subpoenasandquitam
lawsuitsandinthevolumeofinformationrequestedrelatedthereto.Certaindatarequestshaveincludedseveralyearsof
informationfromlegacyacquiredsystemsthatinsomecasesmaynotbereadilyavailable.Theprocessoflocatingthedata
requestedistimeconsumingandlaborintensive,butisrequiredtoberesponsiveandcooperatewiththevariousinquiries.
Wecannotpredictthetimingoroutcomeofthemattersdescribedbelow.
• JerryBeeman,etal.v.Caremark,etal.PlaintiffsallegethatESIandtheotherdefendantsfailedtocomplywith
statutoryobligationstoprovideCaliforniaclientswiththeresultsofabi-annualsurveyofretaildrugprices.In
March2014,theNinthCircuitCourtofAppealsremandedthecasetothedistrictcourtforfurtherproceedings.
• (i)BradyEnterprises,Inc.,etal.v.MedcoHealthSolutions,Inc.(ii)NorthJacksonPharmacy,Inc.,etal.v.
ExpressScripts,Inc.,etal.(iii)Mike’sMedicalCenterPharmacy,etal.v.MedcoHealthSolutions,Inc.,etal.
PlaintiffsassertclaimsforviolationoftheShermanAntitrustAct.Currently,ESI’smotiontodecertifytheclassin
theBradyEnterprisescaseispending.OralargumentswereheldinJanuary2012.
• JasonBerkv.ExpressScripts,Inc.andExpressScriptsPharmacy,Inc.Acomplaintwasfiledbynamedemployee,
JasonBerk,acurrentPharmacyBenefitSpecialistemployee,alleging:(1)acollectiveactionunderthefederalFair
LaborStandardsActforfailuretopaywagesandovertime;and(2)aclassactionforbreachofcontract.The
partieshaveagreedtostaythelawsuitinfavorofearlyinvestigationandmediation.
• Wearethesubjectofvariousquitammatters.
◦ UnitedStatesofAmericaex.rel.LucasW.MathenyandDeborahLovelandv.MedcoHealthSolutions,
Inc.,etal(Medco’sformersubsidiaryPolyMedica).ThecomplaintallegesPolyMedicaviolatedtheFalse
ClaimsAct.InFebruary2014,thebankruptcycourt,presidingoverPolyMedica’sChapter11case,
grantedATLSAcquisitionLLC’sandPolyMedica’smotionforsummaryjudgmentonallrelators’claims
infull,butthecaseremainsstayedwithrespecttoMedco.
◦ UnitedStatesexrel.SteveGreenfield,etal.v.MedcoHealthSolutions,Inc.,AccredoHealthGroup,Inc.,
andHemophiliaHealthServices,Inc.ThecomplaintallegesdefendantsviolatedthefederalFalseClaims
Act,theAnti-KickbackStatute,theCivilMonetaryPenaltyStatuteandvariousstateandlocalfalseclaims
statutes.GreenfieldfiledanamendedcomplaintinOctober2014,andtheCompanyfiledananswerand
affirmativedefensesinNovember2014.
◦ UnitedStatesexrel.DavidM.Kester,etal.v.NovartisPharmaceuticalsCorp.,AccredoHealthGroup,
Inc.,BioScripCorp.,CuraScript,Inc.,CVSCaremarkCorp.Thecomplaintallegesdefendantsviolated
theAnti-KickbackStatute,thefederalFalseClaimsAct,andthefalseclaimsactsoftwenty-sevenstates.
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.
• Wehavereceivedandarecooperatingwithvarioussubpoenasfromgovernmentagenciesrequestinginformation.
Whilewebelieveourservicesandbusinesspracticesareinsubstantialcompliancewithapplicablelaws,rulesand
regulationsinallmaterialrespects,wecannotpredicttheoutcomeoftheseactionsatthistime.Anunfavorableoutcomeinone
ormoreofthesematterscouldresultintheimpositionofjudgments,monetaryfinesorpenaltiesorinjunctiveoradministrative
remedies.
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