(Bloomberg) — Express Scripts Holding Co. (Nasdaq:ESRX) is carefully scrutinizing prescriptions for products made by Valeant Pharmaceuticals International Inc. (NYSE:VRX), making sure the pharmacy manager’s rules are being followed.
“We are looking at every single claim for their products,” Steve Miller, chief medical officer for Express Scripts, said in an interview Friday at Bloomberg’s headquarters in New York. “They are getting extra scrutiny.”
Valeant last year was accused of working with a network of pharmacies to boost sales of its drugs and get them reimbursed by health insurers and pharmacy benefit managers (PBMs) like Express Scripts, even when there were cheaper generics available.
The drugmaker has also been under fire for raising the prices of many old drugs. At a hearing last week in Washington, members of Congress criticized the company for its dramatic price increases on two heart medications. A survey for Bloomberg News found 13 Valeant drugs that have doubled or more in price in the U.S. since December 2014, more than any other large company.
Valeant spokeswoman Laurie Little said in an e-mail that “we greatly value our relationships with channel partners and complying with the terms of our managed care contracts has been and will continue to be our priority.”
Express Scripts has already taken action against one Valeant drug, the diabetes medicine Glumetza, whose price rose 800 percent in 2015. The company started blocking reimbursement for Glumetza when a generic version became available this month.
Overall, Valeant makes “a lot of products that are highly priced that have really great generic alternatives available,” Miller said.
Express Scripts reviews prescription claims to ensure that the manufacturer and pharmacies are operating in a manner consistent with its contracts and in the best interests of its clients and patients, spokesman David Whitrap said in a statement. The reviews ensure that patients and payers aren’t spending more on the products than necessary, he said.
At the Congressional hearing last week, Valeant interim chief executive officer Howard Schiller said the company was revisiting its approach to pricing.
“Where we’ve made mistakes, we’re listening and we’re changing,” he told the committee at the hearing. In prepared remarks for the hearing, he said he expected price increases to be much more modest going forward. And in a Feb. 2 statement, the company said it offers hospitals discounts on the two heart drugs of as much as 30 percent.
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