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Our attorneys stay on top of changes in legislation, agency regulations, case law, and industry trends—then craft timely legal alerts to keep clients up to date on legal developments important to their business.

February 5, 2020

CVS Caremark Adds Over 100 Drugs to Recently Announced Aberrant Product List (AKA the "Naughty List")

Only weeks after the January 1, 2020 effective date of its newly implemented Aberrant Product List, CVS Caremark expanded the list to add more than 100 additional prescription drugs. In addition to the originally identified drugs, CVS Caremark will begin targeting the distribution of these new drugs on March 1, 2020.

These arbitrary quantitative dispensing limitations being placed on independent pharmacies through CVS Caremark’s Aberrant Products List and the other secretive “suspect product” lists maintained by other PBMs subject pharmacies to heightened audit standards. The limitations also place heavy anti-competitive burdens on independent pharmacies to monitor each prescription threshold. Notably, the product lists are not simply targeting drugs that have high rates of abuse like opioids, but include rather iniquitous items such as moisturizers without regard to the formularies of individual plans.

While this is the latest foray into exclusionary, network-wide product management and restriction, it has long been known that CVS Caremark and other PBMs continuously update their internal “suspect product” lists, which routinely flag higher margin drugs or drugs that, for other unknown reasons, may be disfavored by the PBM and often without any notice to the pharmacy.

Barclay Damon has identified certain products being targeting through PBM audits and has developed strategies to assist its independent pharmacy clients with combatting abusive and aggressive audits tactics and terminations based on these lists. In addition, Barclay Damon assists manufacturers, wholesalers. and other stakeholders in protecting their businesses that are being effected by the PBM product lists and other requirements that impede business and customer relationships.

If you have any questions regarding the content of this blog post, please contact Linda Clark, health care controversies team leader, at lclark@barclaydamon.com; Brad Gallagher, counsel, at bgallagher@barclaydamon.com; Brenda Baddam, associate, at bbaddam@barclaydamon.com; or another member of the firm’s health care controversies team.

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