Pharmacy Alert: Recent Actions by Galderma Highlights Possibility of New Litigation Against Pharmacies Over Copay Coupon Programs

Lately, Frier Levitt has seen an increase in actions by pharmaceutical manufacturers (and their vendors) against pharmacies related to the use of certain patient-savings programs, such copay coupon programs.  The programs are designed to reduce patient out-of-pockets for certain branded medications, while making it easier for pharmacies to dispense the manufacturer’s products.  However, manufacturers have begun to focus on the claims being submitted by pharmacies to these programs, and some have even resorted to litigation against these pharmacies.

This most notable example of this is Galderma Laboratories, L.P. (“Galderma”), who maintained a patient savings program known as the “CareConnect Card Program.”  Starting in February 2020, Galderma began filing a number of nearly identical lawsuits against pharmacies over their use of the CareConnect Card Program, and the claims submitted for Galderma products.  The suits alleged claims for breach of contract, as well as fraud, and sought back not only the amounts received under the program, but also attorneys’ fees. 

Over the past year, Galderma has filed over 25 cases against pharmacies and individual pharmacists alleging claims of misapplication of its CareConnect Card resulting in the submission of false claims, misrepresentations, and breach of contracts. Many of the cases were initially filed in Federal Court in the Northern District of Texas, but as time went on, Galderma began bringing the cases in Texas state court, in the District Court of Tarrant County (although several of those defendant pharmacies caused the cases to be “removed” to Federal Court).

Of these twenty-plus cases pending in Federal Court, nearly all of them have been resolved – either through apparent settlement or default judgment.  In addition, while many cases included claims against both the pharmacies and the individual pharmacists involved in the claims submission, most of the individual defendants were ultimately dismissed from the case on the basis of a lack of personal jurisdiction in the Northern District of Texas.

While Galderma proceeded to sue many pharmacies right out of the gate, in many instances, Galderma first attempted to “audit” the pharmacies or otherwise served a “demand letter” on them related to alleged improperly submitted claims to the CareConnect Card Program.  In instances where pharmacies failed to respond or did not sufficiently address Galderma’s concerns, Galderma proceeded to file a lawsuit against the pharmacies and their owners and/or pharmacists-in-charge.

How Frier Levitt Can Help

Frier Levitt has defended numerous pharmacies in cases brought by Galderma – both before, during and after litigation.  Frier Levitt has worked closely with the pharmacies in understanding the CareConnect Card Program and the industry standards for claims submission.  If your pharmacy has ever used or is currently using Galderma’s CareConnect Card Program and are concerned about possible litigation with Galderma, contact us today. We have a team of attorneys who understand the bounds of the CareConnect Program. Our attorneys are knowledgeable in defending pharmacies against lawsuits rooted in allegations of inaccurate application of Galderma’s savings card.