A multiemployer health plan has sued Cigna Group and its pharmacy benefits manager arm, accusing the company of inflating prescription drug prices and steering higher-cost products onto formularies.
The complaint, filed in the United States District Court for the Northern District of Illinois, alleges rebate manipulation and improper retention of funds owed to plan sponsors.
Plumbers Welfare Fund claims drugmakers paid billions of dollars in bribes and kickbacks in exchange for favorable formulary placement.
According to the filing, those payments moved through Ascent Health Services, a Swiss-based rebate contracting entity, before returning to Cigna.
The lawsuit states Cigna categorized rebates as administrative and service fees. That classification, the fund argues, allowed the company to bypass contractual duties to pass rebate value back to customers.
Money routed through Ascent generated more than $84 mn in revenue per employee, the complaint says. For comparison, Apple reports roughly $2.4 mn in revenue per employee.
The suit also alleges Cigna monetized access to its formularies, which raised prescription costs for members enrolled in the plan.
According to Beinsure analysts, litigation over PBM rebate structures has shifted toward disclosure mechanics and cross-border entities rather than pricing alone.
Days before its Feb. 5 earnings call, Cigna reached a settlement with the Federal Trade Commission over separate claims tied to insulin pricing and rebating practices.
Regulators alleged the company inflated insulin prices through anticompetitive rebate arrangements and limited access to lower-cost drugs.
Under the FTC agreement, Cigna committed to relocating the Ascent business to the United States. The company also agreed to adopt new practices aimed at pricing transparency and cost reduction, including preferring lower-cost drugs on its standard formulary, calculating patient out-of-pocket expenses based on net cost rather than list price, and ending spread pricing.
The FTC estimates the changes will lower policyholders’ out-of-pocket drug spending by up to $7bn over the next decade.
