Jerry Beeman Pharmacy Services, Inc. v. Tdi Managed Care

Plaintiffs-Appellants Pharmacies brought suit against Defendants-Appellees Pharmacy Benefit Managers (“PBMs”) based on violations of California Civil Code §§ 2527 and 2528. The district court dismissed the Pharmacies’ claims due to lack of “injury in fact” sufficient to confer Article III standing. We reverse and remand.

I

This case involves the relationship between PBMs (referred to in California Civil Code §§ 2527 and 2528 as “Prescription Drug Claims Processors”), pharmacies, and third-party payors (for example, health insurance companies, self-insured employer groups, and union health and welfare plans). A customer goes to a pharmacy with a prescription and presents both an insurance card and a co-pay to get the prescription. The pharmacy fills the prescription from inventory. The pharmacy then submits a claim to a PBM for reim bursement. The pharmacy usually has a contractual relationship with various PBMs to assist in performing claims processing services. A PBM coordinates certain aspects of the reimbursement relationship between pharmacies and third-party payors. The PBM processes the pharmacy’s claim for reimbursement and pays the pharmacy reimbursements in the amount…