Louisiana’s Attorney General Liz Murrill has launched a legal assault against pharmacy giant CVS with three lawsuits targeting deceptive business practices that allegedly exploit customer data for political messaging and undermine local pharmacies through manipulative drug pricing.
Key Takeaways
- Louisiana AG Liz Murrill filed three lawsuits against CVS and its pharmacy benefit manager Caremark for allegedly engaging in unfair and deceptive business practices.
- CVS is accused of misusing customer contact information to send political text messages opposing House Bill 358, which would have prevented pharmacy benefit managers from owning drug stores.
- The lawsuits allege CVS inflates drug prices while underpaying independent pharmacies, creating a monopolistic market that harms Louisiana consumers.
- Legal actions seek injunctive relief, civil penalties, and restitution for damages caused to Louisiana patients, independent pharmacies, and the public.
- CVS denies wrongdoing, claiming their communications were lawful and that their business model provides lower costs and better access to medications.
Louisiana Takes Strong Legal Action Against CVS
In a significant move to protect consumers and local businesses, Louisiana Attorney General Liz Murrill has filed three lawsuits against CVS Health Corp and its pharmaceutical benefit manager division, CaremarkPCS Health LLC. The legal actions, filed in St. Landry Parish, target what state officials describe as a pattern of unfair and deceptive business practices that have caused substantial harm to Louisiana residents, independent pharmacies, and the public interest. The lawsuits represent a comprehensive challenge to CVS’s business model, which allegedly leverages its dominant market position to manipulate drug pricing and distribution channels.
“[CVS has] harmed Louisiana patients, independent pharmacies, and the public at large,” said Louisiana Attorney General Liz Murrill.
Misuse of Customer Data for Political Messaging
At the center of one lawsuit is the allegation that CVS misused customers’ personal contact information to send politically motivated text messages. The Attorney General’s office issued a cease and desist letter to CVS after the company allegedly sent text messages containing “inaccurate and deceptive statements” about House Bill 358, a piece of legislation that would have prevented pharmacy benefit managers like CVS Caremark from owning drug stores. These communications explicitly urged recipients to oppose the bill, which the AG’s office contends violated the Louisiana Unfair Trade Practices and Consumer Protection Law.
“CVS sent inaccurate and deceptive statements,” stated the Louisiana Attorney General’s Office regarding the text messages.
Governor Jeff Landry joined in criticizing CVS, stating that the company “abused customers’ sensitive information to push a political message.” The controversy has already sparked separate class action lawsuits against CVS over the unsolicited text messages, demonstrating the widespread concern among Louisiana residents about the alleged privacy violations and misuse of their personal information for corporate lobbying efforts. These actions reflect growing public unease about how large corporations use customer data beyond their intended purposes.
Price Manipulation and Harm to Independent Pharmacies
The additional lawsuits paint a picture of systematic economic predation, accusing CVS of inflating prescription drug prices while simultaneously under-reimbursing independent pharmacies. This pricing strategy allegedly creates a squeeze on local pharmacies, many of which are struggling to survive in communities across Louisiana. According to the legal filings, CVS imposes excessive fees on independent pharmacies and manipulates drug prices through its pharmacy benefit manager division, Caremark, creating an unfair competitive landscape that harms both consumers and local businesses.
The Attorney General’s office has characterized CVS’s actions as “inappropriate and in violation of Louisiana law,” reflecting the serious nature of the allegations. The lawsuits seek substantial remedies, including injunctive relief to halt the alleged unfair practices, civil penalties to punish the corporation for its actions, and restitution to compensate those harmed by CVS’s business strategies. While House Bill 358 ultimately failed to pass, Attorney General Murrill and Governor Landry have indicated they are considering new legislation if current laws prove insufficient to address these issues.
CVS Denies Allegations and Defends Business Model
In response to the lawsuits, CVS has vigorously denied any wrongdoing. The company maintains that its “communication with CVS customers, patients, and members of the community was consistent with the law” and necessary to inform customers about potential disruptions to their pharmacy services. CVS has further defended its business model, claiming it provides lower costs and better access to medications for Louisiana residents. “Importantly, CVS Pharmacy remains the lowest cost pharmacy and a critical partner in lowering prescription drug costs for Louisianans,” the company stated in its defense.
“Our communication with CVS customers, patients, and members of the community was consistent with the law,” stated CVS in their defense of the text message campaign.
The company has also argued that removing CVS pharmacies from networks would increase costs for the state, presenting its integrated model as beneficial rather than harmful to consumers. However, these claims stand in stark contrast to the allegations in the lawsuits, which describe a pattern of monopolistic behavior that ultimately increases drug costs for Louisiana consumers while decimating the independent pharmacy landscape. As these legal battles unfold, they represent a significant test case for states attempting to regulate the increasingly consolidated pharmaceutical industry.
