Horizon Pharma plc Provides Comment on Express Scripts' Business Practices
DUBLIN, IRELAND--(Marketwired - Nov 11, 2015) - Horizon Pharma plc (HZNP), a biopharmaceutical company focused on improving patients' lives by identifying, developing, acquiring and commercializing differentiated and accessible medicines that address unmet medical needs, today commented on Express Scripts' business practices.
"Our philosophy of ensuring that patients get the medicine their doctors prescribe is threatening Express Scripts' profiteering and exposing what we believe is a lack of care for patients and respect for physicians," said Timothy P. Walbert, chairman, president and chief executive officer, Horizon Pharma plc. "Express Scripts is not only a pharmacy benefit manager that has significant control over prescriptions that flow to specialty pharmacies, it also operates its own mail-order pharmacy and thus is a direct competitor of small, independent specialty pharmacies throughout the United States. This competitive role, in our view, creates a clear conflict of interest, as Express Scripts stands as both a pharmacy's overseer and competitor. In fact, Express Scripts' specialty pharmacy, Accredo Health Group, Inc., is the largest in the United States with more than 28 percent market share. Based on its Accredo ownership, it's not surprising that Express Scripts would target small, competitive independent specialty pharmacies in order to force those pharmacies from its network, attempt to dominate the U.S. specialty pharmacy medicine distribution channel and further boost its own profits at the expense of patients. As the New York Times reported on July 15, 2015, independent specialty pharmacies believe that insurers and pharmacy benefit managers funnel business to their own pharmacies, even if others may provide better service."
"Additionally, we currently have an agreement with Accredo to provide one of our important orphan medicines to patients, and contrary to the misperception that Express Scripts wishes to create, Accredo accounts for a larger percentage of our revenue than any other pharmacy. However, based on current and past business practices by Accredo and Express Scripts, including its recent $60 million fraud settlement with the U.S. Department of Justice, we are re-evaluating this relationship to determine how we can most appropriately and ethically serve our patients, their physicians and our shareholders," Walbert continued.
"Profiteering, particularly in the case of Express Scripts which recognized more than $38 billion in revenues from specialty and home-delivery services in 2014, and anti-competitive behavior has to stop because ultimately it's the patients who suffer and the impact on the patient is far reaching," Walbert added. "As Linden Care stated in its legal complaint, 'if Linden does not receive a stay pending a hearing, the termination will remain in effect, resulting in innocent patients potentially missing medications due to a physical inability to obtain them through other channels, experiencing withdrawal symptoms from narcotics or experiencing errors in taking medications, thereby placing their well-being in jeopardy.' This isn't the right thing to do for patients and as an industry that exists to serve the patient, we need to take a stand to ensure that regardless of the hurdles we face from pharmacy benefit managers, we continue to do whatever possible to ensure patients have access to the medicines their physicians prescribe."
Statement Previously Released on November 10, 2015
Our primary concern is for the patients who, based on the profit driven actions of Express Scripts, may be denied access to medicines that are prescribed by their physicians. We are committed to ensuring that regardless of these actions, patients will have access to the medicines they need.
Less than five percent of our net sales are from prescriptions that are filled by Linden Care and processed by Express Scripts. In addition, we have a diverse group of pharmacies that participate in our patient support program and no pharmacy that participates in our primary care patient support programs account for more than 13 percent of our net sales.
The notion that Linden Care is a so-called "captive pharmacy" of Horizon Pharma is entirely false. At best Express Scripts is being reckless in its allegations and at worse it is intentionally attempting to mislead investors. As previously stated, all pharmacies that distribute Horizon branded medicines are fully independent. Horizon does not own or have an ownership stake in any pharmacy and does not possess an option to purchase any pharmacy. In addition, the relationship with these pharmacies is non-exclusive where each of these pharmacies may also fulfill prescriptions for other drug manufacturers.
The lawsuit filed by Express Scripts relates entirely to a previously disclosed dispute concerning a prior rebate agreement between the parties. As we previously disclosed approximately one year ago, we terminated the contract with Express Scripts after Express Scripts failed to live up to its contractual obligations. Indeed, after we notified Express Scripts of its breaches, Express Scripts made no effort to cure the breaches, let alone respond to our notice, within the contractual deadline to terminate the contract. The substantial majority of the monetary damages Express Scripts is seeking to recover are for prescriptions that occurred after the termination of the contract. We are still reviewing the allegations in the complaint but we believe the claims are without merit and we intend to vigorously defend ourselves.
In light of Express Scripts' actions, we will evaluate all legal and other remedies and options.
About Horizon Pharma plc
Horizon Pharma plc is a biopharmaceutical company focused on improving patients' lives by identifying, developing, acquiring and commercializing differentiated and accessible medicines that address unmet medical needs. The Company markets seven medicines through its orphan, primary care and specialty business units. Horizon's global headquarters are in Dublin, Ireland. For more information, please visit www.horizonpharma.com. Follow @HZNPplc on Twitter or view careers on our LinkedIn page.
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