CVS Caremark’s recent acquisition of Coram, a specialty infusion services and enteral nutrition business unit of Apria Healthcare, potentially spells negative news for independent pharmacies, and specialty pharmacies in particular. The potential negative consequences can be avoided by those specialty pharmacies that are aware of and assert their legal rights. Large PBMs that own specialty pharmacies, such as CVS Caremark, will continue to attempt to build profits by ignoring Any Willing Provider Laws and potentially illegally preventing private specialty pharmacies from joining their networks.
This past week, CVS Caremark agreed to acquire Coram, which is the specialty infusion services and enteral nutrition arm of Apria Healthcare, for around $2.1 billion. Coram had been one of the largest infusion services providers and services more than 20,000 patients each month. By acquiring Coram, and its more than 85 locations (including 65 ambulatory infusion sites), CVS Caremark will now have an even stronger foot hold in the specialty pharmacy market. CVS Caremark will be able better compete in the specialty infusion business against its largest competitor, Walgreens.
However, this acquisition potentially spells bad news for community pharmacies and independent specialty pharmacies who do not act. With this new acquisition, CVS Caremark intends to streamline care management for patients, and will use this to further leverage its gobbling of patients from independent pharmacies. In addition, with its broader capabilities to service specialty infusion patients, CVS Caremark will likely further restrict specialty pharmacy networks, thereby funneling more business to their subsidiary owned specialty pharmacies, such as CVS Caremark Specialty Pharmacy.
Specialty pharmacies need to be vigilant and proactive following this transaction, to ensure continued participation in CVS Caremark networks. Many States have Any Willing Provider Laws, which prohibit a PBM from terminating a pharmacy that is willing and able to participate in the network subject to the same terms and conditions applicable to other participating pharmacies. These laws can be used by pharmacies as a tool to prevent network termination and to compel admission to specialty pharmacy networks.
Frier Levitt has successfully handled multiple federal court and private arbitration matters against various health insurers and PBMs, in which we were successful in forcing the PBMs to admit specialty pharmacies into their specialty pharmacy networks. Frier Levitt is experienced in addressing these issues and can assist specialty pharmacies seeking network admission. Contact Frier Levitt to speak to one of our attorneys.
