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1. Why are we just suing Catamaran?

- Catamaran has shown to be the most egregious and aloof of all the PBMs.  Their MAC lists are rarely updated in a timely manner and their ingredient pricing has shown to be below the market-place.  Their revenue, according to their year-end reports, increased by 40% in 2013 – while our gross profits decreased by about 2.5%.

- To sue multiple PBMs would greatly increase legal and expert fees and at the same time increase the projected time for the case to be resolved.  Other PBMs will surely be monitoring these proceedings, and if we are successful against Catamaran it may spark positive change in our dealings with those other PBMs.

2.      How long is this projected to take?

It is impossible to predict with certainty, but the lawyers are projecting the case to take 2-3 years.  Whether there could be an earlier resolution by way of settlement will depend on a variety of factors, including the nature of information produced in discovery.

3.      Is it possible that damages will be awarded?

The suit is based on Catamaran’s failure to uphold its contractual obligations. Because our claims will in large part focus on under-reimbursements (going back to January 2013), a successful resolution of the suit may well include an award of damages. We hope that whatever such an award would look like, resolution of the suit will ensure that changes are made by the PBMs, who seem to want us to disappear.

4.      Has a lawsuit like this ever been tried?

There have been plenty of suits in the past against Catamaran and other PBMs, but not regarding the exact claims we will raise against Catamaran. Nevertheless, we are confident that the claims have a sound legal basis.

5.      What will we be responsible to do during this case as a plaintiff?

- We will be asking some stores (not all stores) to supply reports from their computer showing how much below invoice cost you were paid for ingredient cost by Catamaran during 2013 and the first quarter of 2014.  Only those stores that keep their invoice pricing up to date in their computer will be asked.  We have many of the computer vendors designing reports that will make this an easy project at store level.

- We will probably not ask the computer vendor HBS to assist, as they are a subsidiary of Catamaran.

6.      How many stores are you projecting to be needed to be comfortable with financial projections?

- We are looking for a minimum of 4000 to 5000 stores to be assured that we will have the money to proceed without cutting any corners.  This will give us a war chest of $2 Million to $2.5 Million.  You can be assured that Catamaran will spend whatever is necessary to fight this suit.

- With that many stores, we are comfortable that Catamaran would be unlikely to retaliate against the plaintiffs in this case, out of a concern of causing a public relations nightmare and civil lawsuits.

7.      Who initiated this lawsuit?

The PARD, a Philadelphia county non-profit professional pharmacy association along with their subsidiary, the Keystone Pharmacy Purchasing Alliance initiated this project.  PARD was formed in 1898 & Keystone in 1996.

8.      Are other organizations involved?

- To this point we have been assured by 15 other Group Purchasing Organization throughout the country that they will assist in any way to have their members sign up as plaintiffs.  These organizations represent over 12,000 stores.

- Other organizations such as PUTT have verbally agreed to help, as well as a few State Associations.

- At this point we have not asked any Chains to work with us, but that is a possibility and a decision to consider if and when we receive an inquiry.  We do not expect to talk to CVS, given its relationship with Caremark.

- One GPO (PIPCo) designed the website; another (PPSC) has helped with the marketing materials.

9.      If there are damages rewarded, how will they be distributed?

- Each plaintiff is a partner in PUNCH, LLC.

- If and when the lawsuit(s) are settled or otherwise resolved in court/arbitration and all fees and expenses are paid, the balance will be distributed proportionately to each participating store-plaintiff.

- If for some reason this suit proves to be unsuccessful in court/arbitration, any remaining dollars will be returned to plaintiff-stores evenly.

- Neither the PARD nor Keystone is looking to see any profits from the lawsuit – Their present employees will just be involved in the administration and office space made available at their headquarters in Philadelphia.

10.  How will we be assured that the monies are being used properly?

The books (QuickBooks) will be open to be reviewed by any plaintiff or endorsed Organization with the signing of a Confidentiality Agreement.  We do not want the defendant to see our financials, for obvious reasons.

11.  What else are you attempting to accomplish with this lawsuit?

There is only so much you can accomplish with a lawsuit, even a successful lawsuit. But we hope that our efforts against Catamaran will lay the groundwork for better practices in the industry. To that end:

- We hope to see a change in the way Catamaran (and, as a consequence, other PBMs) operates and calculates ingredient costs (MACs)

- We hope to show plan sponsors who deal with the PBMs the deceptive practices that PBMs  use such as “Spread Pricing” and “inflated AWPs” on their mail-order repackaged products and how much more it costs them.  We want to show the plan sponsors that Transparent PBMs that only charge a minimal fee per Rx would be a better option for all concerned.

- We are hoping that, as this is a National endeavor, Congress will see this (as we will be seeking as much Press as possible) and start asking questions.  For too long, Congress has sat back & ignored this business category and allowed PBM’s to operate without any governmental  oversight.  They have allowed “take it or leave it” contract negotiations.  They have allowed PBM owned mail-order facilities (which do not use MAC pricing) preferential treatment and pricing.  They see PCMA lobbyists with regularity that expounds tainted and false information. 

- We want Congress to get involved, review the many “Cost of filling and Rx” reports already done, and insist that present Professional Fees be increased according to the results of these reports.  We would love to hear the PBMs explain  to how they calculate the professional fee.

- We want to see an end to all restrictions on prescription plans that restrict Any Willing Provider that are promoted by the PBMs for their own financial benefit.

- We want to show that PBM formularies are not decided on what is best for the patients’ health, but rather what is best for the PBM profit structure through rebates.

- We want to show plan sponsors that Transparency will save millions of dollars that could be used to increase Pharmacy Professional fees and still result in a savings of their Rx plan expenses.

12.  How much will this cost me & how long do I have to decide?

- The fee to become a participant is $500 if paid by May 31, 2014.  Thereafter the assessed fees may be increased to $1,000.  We will not be asking for any more money – Guaranteed.

- Once we have 4000 to 5000 stores signed up & the litigation begins, we will close the membership opportunity.  It will then be up to the PUNCH Board of Directors to decide if membership is re-opened.

13.  What happens if 4000 to 5000 stores do not sign up in a timely manner?

We will evaluate whether to proceed with the litigation or return to stores all monies received minus expenses already incurred.

14.  How will PUNCH, LLC be structured?

The structure will be set up in accordance with legal requirements – It is presumed it will consist of a Board of Directors (5 – 7 members) who will be responsible for the day-to-day operations and review of financial statements at least monthly.

15.  Who is the law firm?

Williams Cuker Berezofsky LLC, located at 1515 Market Street, Suite 1300, Philadelphia, PA.  Their phone number is 215-557-0099, and their website is . They are more than willing to discuss with you the nature of the suit we intend to file. Any purely administrative questions (e.g., how to become a plaintiff, PUNCH corporate structure), however, should be directed to PUNCH at 215-464-9892.

These FAQs have been developed in consultation with Williams Cuker Berezofsky, and are communicated for legal purposes. The FAQs are considered privileged, confidential material and therefore should not, under any circumstances, be made publicly available.

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