CVS Caremark Issues Statement on RxAmerica Civil Settlement with the United States Department of Justice
WOONSOCKET, R.I., Oct. 15, 2012 /PRNewswire/ -- CVS Caremark Corporation (NYSE: CVS) announced today that it has reached a civil settlement with the United States Department of Justice regarding its investigation into certain business practices of a subsidiary of Longs Drug Stores Corporation which began prior to the acquisition of Longs by CVS Caremark in October 2008. Pursuant to the settlement agreement, RxAmerica has expressly denied any liability.
The settlement resolves allegations that, in 2007 and 2008, Medicare Part D paid claims related to RxAmerica's submission of inaccurate pricing data to the Centers for Medicare & Medicaid Services ("CMS") for use in estimating prescription drug prices on the CMS website tool, Plan Finder, for certain generic drugs covered by a Medicare Part D Prescription Drug Plan sponsored by RxAmerica. The settlement also resolves all allegations in a related federal qui tam complaint filed by certain of the Part D Plan members. These RxAmerica Plan Finder submissions were previously the subject of the CVS Caremark consent order with the Federal Trade Commission earlier in 2012.
CVS Caremark has cooperated fully with the United States Department of Justice in resolving this matter, and RxAmerica worked with CMS on a corrective action plan to address any Plan Finder issues in late 2008 and early 2009. As a result of these efforts, in September 2010, CMS closed the corrective action plan, notifying the company that CMS had monitored the sponsor's Medicare Prescription Drug Plan Finder submission performance closely and that it had consistently submitted accurate pricing data to CMS throughout 2009 and 2010. RxAmerica Medicare Part D plans were last offered in calendar year 2011. The settlement includes a payment of $5.25 million to the Department of Justice, plus costs and other fees. These payments have been fully accrued for and will not affect the Company's 2012 earnings results. The investigation commenced in 2009 and has been previously disclosed in the Company's SEC filings. The Company agreed to settle the matter in order to avoid the burden and expense of continuing litigation.
About CVS Caremark
CVS Caremark is dedicated to helping people on their path to better health as the largest integrated pharmacy company in the United States. Through the company's more than 7,400 CVS/pharmacy stores; its leading pharmacy benefit manager serving more than 60 million plan members; and its retail health clinic system, the largest in the nation with more than 600 MinuteClinic locations, it is a market leader in mail order, retail and specialty pharmacy, retail clinics, and Medicare Part D Prescription Drug Plans. As a pharmacy innovation company with an unmatched breadth of capabilities, CVS Caremark continually strives to improve health and lower costs by developing new approaches such as its unique Pharmacy Advisor program that helps people with chronic diseases such as diabetes obtain and stay on their medications. Find more information about how CVS Caremark is reinventing pharmacy for better health at info.cvscaremark.com.
SOURCE CVS Caremark Corporation