Express Scripts Holding, controller of medical benefits, has refused the claims that it swindled Anthem for prescription drugs. The drug benefits administrator is looking for a court order that Anthem cannot ask for lesser drug prices from Express Scripts.
In March, the health insurer prosecuted Express Scripts for roughly $15 billion in damages, complaining that the later disrupted its deal by denying to renegotiate rating conditions in good faith. Anthem also accused Express Scripts of not meeting some functional requirements coded in the contract.
Anthem is also seeking a verdict that would allow the health insurer to dissolve the 10-year agreement with Express Scripts, however, it had not yet decided to proceed with the termination of the deal that is scheduled to expire in 2019. But, the drug benefits manager refused to the complaint and filed its counterclaims in the New York District Court. Express Scripts has petitioned unstipulated damages from the health insurer. The administrator is also looking for a verdict that stops Anthem from terminating the contract, THE WALL STREET JOURNAL reported.
According to the lawsuit, the health insurer demands a reduction in its payments by nearly $15 billion that includes roughly $13 billion enveloping the rest of the contract period as well as a $1.8 billion damages during the closing period of the contract. The Tuesday filing indicated that Express Scripts has made five different price reduction offer between the periods from June 2015 and March 2016, which would have trimmed drug prices for Anthem by $2 billion to $2.8 billion in the rest of the contract period.
The drug benefit controller also accused that the administration team of Anthem has denied discussing the pricing reduction in good faith and is trying to wrongly re-write the contract terms. With regard to the deal signed in 2009, Express Scripts purchased the pharmacy benefit managing service of Anthem for around $4.68 billion. In connection with the 2009 contract, the health insurer accepted Express Script's rating policy for the prescription drug.
The Vista Voice reported that Argus analysts reaffirmed its rating on Express Scripts' stock to "hold" grade. While researchers at Cowen and Company increased their rating on the company's stock to "outperform" from a "market perform grade. The analysts also increased the objective price for the stock to $80.00 from $76.00. Oppenheimer's analysts reaffirmed their rating on the stock to "market perform" grade.
According to ZERGWATCH, Anthem is currently trading close to $142.59. On an average 18 analysts have fixed a 12-month objective price of $17.15 on the company's stock, pointing out that the share could still profit over 20%. The maximum target price set by the analysts was $197.
McCarthy Gloria, chief administrative officer of Anthem, sold 4786 shares of the company for $680,900. Swedish Joseph, chief executive officer, sold 11626 in Anthem valued at $1620400.
