Legal Wins Against PBMs | Mark Cuker, Attorney

Speech to text:

Mike Koelzer, Host: [00:00:00] Mark for those who haven't come across you online, introduce yourself and tell our listeners what we're talking 

Mark Cuker, Attorney: about today. Uh, I'm Mark Cuker. I'm an attorney with Jacob's law group and we're talking about, uh, lawsuits that pharmacies have filed against PBMs pharmacy benefit managers to assert their rights under their contracts and under state law.

Mike Koelzer, Host: You represent a ton of pharmacies, right? We have over 

Mark Cuker, Attorney: 900 clients right 

Mike Koelzer, Host: now. Is that I don't want to say class action because I don't imagine it's that it's not a class action. It's just a lot of clients with the same gripes. Yeah. 

Mark Cuker, Attorney: That's a good way of putting it. So class action is a very specific legal term.

That's very misunderstood. Uh, and a class action. The classic class action. Shareholders suit where let's say, uh, oh, you know, you bought a stock in Facebook because you thought, uh, their earnings were this. And it turns out their earnings were that. And the stock went down and you could, one shareholder could file suit on behalf of millions of shareholders only in the name of that one shareholder.

And when that's done, there's a very complicated process where the court has to assure it should go forward as a class action. This is a mass action. Every pharmacy is in the case under their own name. Now the facts there are, uh, claiming and the legal basis for their claim is pretty much the same across the board.

But each pharmacy is in front of the court. Each pharmacy brings its own claim, but together, because if they act as a male. There are tremendous economies of scale, tremendous savings that you can have rather than each pharmacy bringing its own lawsuit. 

Mike Koelzer, Host: Are these 900 that you've done pieces over time?

Or is this truly 900 in this mass action 

Mark Cuker, Attorney: over time? There's 450 approximately in federal court in Pennsylvania. There's 45 in St. Clair county, a new Illinois. There's about 30 in Alameda county, California. And there's a bunch that we're preparing to 

Mike Koelzer, Host: file. It sounds like there are different courts, but as it kind of all the same lawsuit that you just then had to piece it to the right area, 

Mark Cuker, Attorney: That's basically correct.

It's basically the same claims brought in different colors. How did you 

Mike Koelzer, Host: get 900 pharmacies to join in? I mean, I know there's a ton of pharmacies, but how did your firm come to represent so many 

Mark Cuker, Attorney: of them, we were approached a number of years ago by a group in Philadelphia. Uh, that had connections all over the country and they reached out to pharmacies all over the country and we're able to recruit a bunch.

And since then word's gotten out and we've gotten hundreds more since that time we're basically working on a contingent basis. So, uh, there's very little money. Uh, if any upfront required to join. Depends on what the terms you, uh, went to. Uh, Arranged, but in any event it's mainly contingent. So there's no very modest, upfront financial obligation.

And the big reason is that PBMs are abusing pharmacies and they want to do something about it so that this situation has only gotten worse. It was bad when I started, it's only gotten worse and it's really intolerable and PBMs break the law. They violate the contract. They need to be held accountable. 

Mike Koelzer, Host: When you say, when you started, what year do you define that as you becoming part of this fiasco of PBMs?

Mark Cuker, Attorney: Well, I was first, uh, retained in 2014. We spent a year investigating the industry. I didn't know what a PBM was when I got started. Um, I spoke to everyone I could, in any aspect of the industry, I could, I took the PSOs wholesalers, PBM, former PBM, or. Uh, people who worked with consultants for pharmacies, uh, independent pharmacists at all levels and learned everything I could.

And we fought our first case in February, 2015. And since then there has been, you know, there's been a lot of, uh, vertical integration in the industry. That's been very harmful and, um, some of the. Uh, some other things have, have taken place, which are harmful. On the other hand, there have been many, many, many state laws and state Mac laws and state PBM reform laws that really give pharmacies some weapons to fight.

Mike Koelzer, Host: As you learn about this. And first of all, do you get emotionally involved? You say those sons of a bitches look at what they're doing and so on. That's number one. And number two, is it good as an attorney to get emotionally involved? Or do you want to say, all right, [00:05:00] come on, settle down. We're going to do this 

Mark Cuker, Attorney: methodically.

Um, those are great questions and the answers to both questions. Yes. So, so first of all, uh, just see my background. My parents were immigrants from Poland. They were Holocaust survivors. They came to America. Uh, my dad had a small business. I lived upstairs for 17 years. My dad probably worked 99, exaggerating 90 hours a week.

My mom probably worked 60 hours a week. 

Mike Koelzer, Host: What was that business? 

Mark Cuker, Attorney: It was a convenience store, a candy. It was an old fashioned candy store, soda fountain with some groceries, but I understand what it's like to be a small businessman. Um, and I understand what it's like to fight large businesses to compete with chains.

I understand all those things. When I see the abuses that take place in this industry. And what I tell everybody is, you know, my dad wasn't a terribly wealthy man, but he had one thing. He knew he set the price of everything. He sold everything in his store. He knew if he knew what it would sell for, but for somebody.

Pharmacy doesn't work that way. The pharmacist has someone come in, fills a prescription, puts through the claim and boom could then find out that he's going to be paid here. She's going to be paid less than the acquisition cost. Sometimes a lot less than acquisition costs. Pharmacists have no control over it.

There are sales prices, which is a pretty insane business model. So when I see the abuses that happen and I see the arrogance of the PBMs and I see how they try to rig the system to avoid being held accountable, of course, Uh, angry and emotional at the same time. I think there was a line from the godfather, the godfather three, uh, don't get angry at clouds.

Your judgment was made by the godfather. One, one of them don't get angry at clouds, your judgment. So, uh, in our firm, we conference everything, we discuss everything and we, I, I run everything past cooler heads, uh, to make sure that, uh, we're we have, we must act in a. Calculating an unemotional fashion. Ultimately, ultimately we may make our decisions that way or else we could get in trouble.

Mike Koelzer, Host: You bring it to the group just to make sure that you, Sarah, am I thinking straight on this? 

Mark Cuker, Attorney: Exactly. We have a group of five attorneys in our PBM litigation group and we have conferences at least once a week and we run things by each other to make sure and, and, you know, it gets critical. Everything gets a critical where you do from people who are not emotionally invested in it, which is really important, uh, to make sure that, um, it makes it makes legal sense, logical sense, as well as being satisfying emotionally, 

Mike Koelzer, Host: because a lot of times you might think that.

Doing something non emotionally, because maybe your head's not burning and your ears don't feel hot in that kind of stuff, but you still might be on the emotional level without even realizing it. So you kind of check off with someone. 

Mark Cuker, Attorney: Yeah, we have to do that because I've been so immersed in this for so many years that you just need another proud, more detached perspective.

Mark. 

Mike Koelzer, Host: Someone says, well, If you don't like it don't sign the contract. PBM will go on and find somebody else. Now I know from being an independent pharmacy owner, it's hard to sign a contract. You can't even see, but besides that, that's an important point. What's the simplest answer to that saying, Hey, if you don't like it don't sign it.

Mark Cuker, Attorney: Let's talk about that. The first point is. That pharmacists actually have rights under the contract so they can assert that they're really not aware of. Okay. For instance, the first thing that was decided in our case years ago, where we filed the first lawsuit was the following. Um, Kay was then a catamaran and became Optum.

Uh, we, the suit was mainly over Mac pricing and, uh, they took the position, Mac prices, whatever we say. We took the position. Mac price can not be whatever you say it is because first of all, there's language in the contract that actually puts some limitations on the PBMs discretion in setting a Mac price, uh, actually says, I mean, I can read to you, this is from the Optum provider manual administrator, determines Mac pricing based on the review of pricing information.

From nationally recognized pricing service, one or more national drug wholesalers, and publicly available results of CMS is survey of NAIDOC prices per prices, which is NAIDOC. And there's similar language in the provider manuals, the other two PBMs. [00:10:00] So it means they can't just set any Mac price. They want to take that position.

They act that way. When you appeal it, when you make them file a Mac appeal, they are denied. Uh, with, I would say deliberate disregard of what the actual wholesale price data is, but the bottom line is the court has already ruled in our case that the Mac price must be connected to the wholesale market. Secondly, Most states, probably 33 or 34 states, at least have Mac laws that really also require the Mac to be connected to the wholesale market price.

So, the first thing is you actually actually have rights under the contract. Um, the second thing is this, um, the worst part of the contract, the most onerous part is the arbitration clause. Because of the arbitration clause in the Optum agreement and in the CVS agreement, because the arbitration clause in effect takes away your ability to vindicate the rights you do have under the contract, because you can't Sue in court and you have to Sue an arbitration.

And if you Sue an arbitration, each pharmacy has to bring their own case. They can't combine multiple pharmacies into a case. And the arbitrator's fees alone that you have to pay costs $400 to file a complaint in federal court and costs $4,000 to file a company. With the American arbitration association. And that's just the start because you now have to pay half of the arbitrators fees, which will be tens of thousands, if not hundreds of thousands of dollars.

So the arbitration clause functions as a get out of jail free card and what the PBMs do. And they're not unique in that other businesses do this too. They build the arbitration clause into their business model. So basically they can screw the pharmacy. They basically set Mac prices that are indefensible and they rely on the arbitration clause to act as a wall against any efforts to hold them accountable.

And that's why it's so important that we have defeated the arbitration clause. Now in two cases, 

I'm going to play devil's advocate. 

Mike Koelzer, Host: I hate the PBMs with a vengeance, but I gotta ask it here. 

All right. So 

the contract says there's an arbitration clause 

in there, 

and it also says before you can come to court to complain against the PBMs, you have to run a sub-four minute mile, whatever.

And so I pull my pen out or through the PSAO and I sign it well. I'm the dummy that signs it. I know I can't run under a four minute mile and maybe I should know that arbitration costs a lot more. So it's still my responsibility to not sign that. What is a response to that? 

I hate that. I hate to think that we've signed stuff that we can't even begin to do just like a sub four-minute mile, but what's a response to someone that says, Hey, you signed it.

Mark Cuker, Attorney: The response is that there's a doctrine in the law. 

I hate to sound like a law professor 

called an unconscionable contract. 

Okay. 

A classic example of unconscionable contract, 

right. 

Loan shark. 

All right. So 

you borrow money 

from somebody 

at an interest rate of 40% a week. No bones about it. It's 40% a week, 

you know, it's 40% a week 

that contracts are illegal.

It's illegal. It's usury, it's illegal. It's unconscionable and cannot be enforced. The problem, you know, with those contracts is, you know, they're not enforced in court, but they could never go to court to enforce that. But they, you know, but that's an example of, they actually are, um, you know, payday loans where the interest rates are 600.

It's interesting. So these contracts, uh, the court has held if there's a lack of meaning. And basically, if you need to sign the contract in order to get enough customers to keep you in business, then you have then you lack meaningful choice. Interesting. And therefore, if it is oppressive and unfair, it's got it.

It's not just you that lacks choice. It's oppressive and unfair. And it is so onerous. You can't vindicate your rights, then it is unconscionable arbitration. Doesn't have to be unconscionable. You can have. Arbitration that, that, that, that is legitimate. But, what they do is they pile on, it's not just arbitration.

They pile on these conditions. You have to pay the AARP half the arbitrators [00:15:00] fee. You can't consolidate claims with other pharmacies. That's what makes it impossible. You know, we filed a case at arbitration for 26 pharmacies. We were fine with it until they said you had to split it into 26, separate arbitrarily.

Then at that point, it was going to, you know, cause that, cause it cost $50,000 just to find out that you have to split it to 26 separate. There's no way we were going to go 26 times 50,000. You know, the mere fact that you signed it is not enough to, um, force you to arbitrate under intolerable conditions.

Mike Koelzer, Host: Most pharmacists don't sign something with any intention not to follow through on it, because we're used to a lot of handshake deals with our customers and vendors and those kinds of things. I know you don't want to go into a contract thinking you're going to break it. That it's not fair, but it never dawned on me that a contract might not be legit.

Mark Cuker, Attorney: Like you said in our Pennsylvania case, the 430 pharmacies had never seen the arbitration clause, the PSA. So what, uh, the PSCO signed up, but they were not allowed to even show it to him. So that. That's contrary to the very, the whole idea of a contract is a meeting of the minds. You know, as I offered to sell you this for $10, you agree to buy it for $10.

How could you ever contract this? Something you never saw? You know, there's that part of it as well. And, um, the other thing is, um, in the Optum case, the arbitration clause is at page 125 of 160 page provider men. It's not even identified in the table of contents. Does anybody read the provider may and you don't sign the provider manual, you don't sign it.

It just shows up in your provider portal someday. And they say, you're now everything you're now doing is subject to our provider manual. So that's the so-called contract that they want to hold, they wanted to hold the pharmacies to and the California court would have none of it. And he just had none.

Mike Koelzer, Host: You are responsible for a recent win against this arbitration clause and so on. Is that right? Two, two recent wins, two recent wins. That's fascinating. I read that at night. I actually texted my wife and I don't involve her too much. Business while she doesn't want to be involved in the business. But I said, this is fascinating to me that I'm no longer just the dummy who signed a contract.

That contract can actually be illegal. And that was fascinating. So that's why we're talking. Even I remember like 10 years ago. I was so pissed at the PSA. I was saying we never saw this contract. And they would say to me, well, go look at the provider manual. I'm like, that's bull crap because the provider manual doesn't have this, this and this.

And they're like, yeah, it does go look. You can see it has something about this. It has something about this, something about this. And I'm like, okay, you got me on that one. I'm going to read that. But. Why can I still not see the contract? And they gave me some horse manure answer, and I kind of just went on with life because you figured you were screwed.

You couldn't do it. So you kind of went along just like with the cable company or something like that. But is there anything behind that the PSA is not showing the contract? Is that nonsense? 

Mark Cuker, Attorney: It's uh, it's, it's insane. I mean, I got to tell you when again, when I started, I said what I mean, like what. How can they notch and, and, um, but it's.

It's contrary to every notion of what a contract is. It makes no sense what I used to say. So I can still say this entire industry is built on a foundation of contractual quicksand. It's not a contract. And you know, the decision we got in Pennsylvania, uh, specifically said that if the pharmacies could not see the contract, they're not bound by the arbitration clause period.

Um, California. And they went further and, and also talked about all the substantively unconscionable provisions that are in disinfectant. You couldn't see it. The fact that you can't very phrase it, you didn't get a trial. Okay. You can't get a trial with witnesses. You only get a trial by documents. You can't subpoena witnesses.

You can't take discovery. 

Mike Koelzer, Host: Is this beyond even arbitration or are you saying these are the arbitration rules? These 

Mark Cuker, Attorney: are the arbitration rules. It's absurd. You know, they don't have to give you any information at all. Anything. Now I'll tell you why you basically have to know what you're going to have to do to improve your whole case before you file.

Uh, which is again, contrary to, to, uh, basic notions of doctrine in the law of fairness, you know, somewhere, it seems crazy. That's somewhere built in, into our legal [00:20:00] system. There's a concept. Uh, doctrine in the law fairness and it's actually still in our system. It actually is in there, but what happens is slick lawyers and these believe me, they have very good lawyers, find ways to use process to use basically when your labor is we'll call legal technicalities and procedures to frustrate your ability to get a fair shake.

And the classic is this whole arbitration thing. There's a whole body of case law Supreme court cases. They have now built up to use what the federal arbitration act was an innocuous little law passed in 1922. And then the last 20, 25 years, it has been used by big business to squash consumers and small businesses.

Mike Koelzer, Host: The arbitration thing. It makes a lot of sense that its base, Hey, let's not take all the costs. Let's make it cheaper and let's do it quickly, or Hey, we're on the same side. It made sense, but that's fascinating what you say about the general fairness. I'm thinking about my late father. Now. Let's say he wasn't in the pharmacy.

He was so he was skewed to the pharmacist side, but let's say he wasn't, I would go to him for advice, you know, and sometimes he would set me straight and say, well, Mike you're upset or this or that, but let's pretend that I was able to get my wits about me and just to explain it to my dad. It would be like him saying, well, that doesn't sound right.

You know, it's kind of like a, it's kind of like a general fairness that is supposed to be 

there. 

Mark Cuker, Attorney: Yeah, yeah. You know, and it, you know, and, and like I said, these, these, these concepts are as old as the US constitution and, but they've been perverted and twisted around, um, And it's, you know, it needs to be set.

Right. And so I I'm, I'm happy. We were starting to set it right. Because like I've said, we've won these two issues. We won it in two cases, they're appealing. I think that I'm, I'm really pretty confident. They're not gonna, they're not going to the windows. 

Mike Koelzer, Host: Some people really don't think they will. Was this a big wind?

Something that we haven't seen either ever or recently? 

Mark Cuker, Attorney: I think it's a big win. One case came down on May 28th and the other one, I think in the middle of the lake, June one in California was mid to late June. Um, I am not surprised we won. Um, because I knew the law was on our side here. I took a long time to make one of those decisions.

So, but it is a big win, uh, and, um, it could be a real game changer and opening the door for basically, you know, it's like, I'm mad as hell and now you don't have to take it anymore. You really can do something about it. 

Mike Koelzer, Host: You and I know you won this just because you're a great attorney. There's no doubt about that, but.

Was there anything else that led to this? When was the timing? Right. So let's take your attorney skills out of it. Was there anything else going for us as a group now was the timing, right? 

Mark Cuker, Attorney: Well, These concepts of fairness were already there in the law. And we just had to pull them out, show them to the judge and have the judge decided, well, I can say as I wish it came sooner, uh, in terms of the timing, but those decisions on which we based our, uh, our arguments were from the early two thousands, 2006, 2008, 2000, um, uh, 13, they were, they were, they were not that recent, the Rutledge case.

I don't know if that's what you're getting at or not really had nothing to do. It's a very, very important decision. Don't get me wrong. That had nothing to do with our situation. 

Mike Koelzer, Host: I have a good one. Told me as I complained about the business. And he's like, Mike, don't worry too much about things because in life you're only going to go so far down one road before the roads that used to look not so good.

Start to look a little bit better. And I'm wondering if in this case, maybe the judge is just fair, maybe they're almost like we don't even have. Are you this bull crap anymore just by sniffing it, you can tell it's not fair. I wonder if it got so bad that there was only one direction to 

Mark Cuker, Attorney: go.

I know when it was what the judge had put in their written opinions. Um, and that's the way they read. You know, if, if, just like we've said, if you can't see a contract, how can you be bound by it? Pretty straightforward and pretty simple. 

Mike Koelzer, Host: But Mark, why now? I mean, people have been fighting that for, like you said, maybe 15 years or 20 years.

Why now does this judge decide this? It's gotta be all on you. 

Mark Cuker, Attorney: Okay. Uh, you know, take it right here. I'll take it. But, uh, you know, we, I, you know, I'm still in front of him. Okay. [00:25:00] So I don't want to say anything that could some way, uh, you know, affect 

Mike Koelzer, Host: things. Right. You can just say what's happened so 

Mark Cuker, Attorney: far. No, I don't wrap him around my little finger.

He's his own guy, but I've D I may say this about judge Manny. He is genuinely concerned. Genuinely, and this is all this true of all judges to some extent, but really to, if I'd been in front of him before he cares about giving the people in court a fair shake, you really, really do. I think this just bothered me.

I think it just really bothered him. Now, you, you, you know, his opinions speak for itself, but I think it just bothered him as it should. I mean, he said to us at a hearing a year earlier that this really bothered him, that these people were being held to a contract. They couldn't see, 

Mike Koelzer, Host: Maybe it was the time that you brought this unconscionable argument in front of him.

And it happened to line up with. Being a person that, that what, legally, not just like you got them crying. I mean, legally he understood that. And it was because of maybe him feeling that inside of 

Mark Cuker, Attorney: himself. I mean, look, it's a common sense thing. Okay. All the laws on the books aren't worth a pitcher, a warm spit, unless they could be enforced, right?

Yeah. They don't mean anything unless they can be poor to a large extent in our societies. So. Okay. To a huge extent, you know, they can't, you know, they can't put every thief in jail. Right. Most people walk into place. They don't shop left or right. You know, most people are relatively honest. Okay.

But to a large extent, we're on the honor system. All right. If you have. Big companies who decide, they're just going to grab every dollar they can, any way they can and they don't care about anything else. Okay. And then you need an enforcement mechanism because they've got the power and they've got the muscle.

And the one place where there's a level playing field is in court. A little guy can Sue a big guy and they're both equal before the law. I'm not the first person to say that. Believe me. Okay. So when you rig this arbitration, like arbitration is supposed to be a good thing and it can be, it can be faster.

There's no backlog in arbitration. It can be fixed. Was it faster? If you take 20, 26 pharmacies to one PBM and you split it into 26 separate cases, is that faster? Is that cheaper? No. That shows you how they perverted the arbitration system to make it impossible to win. And so. It's not hard to show that to a judge, say, arbitration, good.

This arbitration, horrible, doesn't work impossible. As I say art, the purpose of arbitration is to facilitate the resolution of disputes. These arbitrations are deliberately designed to frustrate the resolution of disputes. And that's why they lost. And that's why I believe they will continue to lose.

Mike Koelzer, Host: That's very telling of an organization when they say that they say, look, we're on the up and up and everything. If you don't like it, though, we're really concerned and we're gonna set up this great way to figure this out. But when someone finally brings to the surface, their quote, a great way of figuring it out is ridiculous.

And certainly. Is the opposite of figuring it out. It's like, I'm a judge. Oh, so you're saying that first of all, they said it was a good contract, but if it wasn't looked, we'll find a way to figure it out, but if the way to figure it out sucked, purpose. Well, then, you know, you have a problem from the start.

Then the whole contract is questionable. You said you were in front of this judge before, what kind of different stuff have you been in front of him for? 

Mark Cuker, Attorney: Well, the other case I had just kind of interesting. So, um, before the great mortgage debacle of 2000. I've been involved in a lot of litigation involving fraudulent mortgages.

It's an old scheme. Okay. You, you basically, this was a number of years ago, you built a bunch of homes that are worth a hundred thousand dollars. You price them at 180. You sell them to a bunch of first time home buyers who are very unsophisticated. You get them 90% financing because all they care about is their monthly.

Right. And you fraudulently qualify them for the loans by misrepresenting certain things. Um, and that was what the case was about. And it was really a 4runner because basically the whole mortgage debacle we had was to a large extent, based on the same scheme, 10 years later, 10 years later, you go to close a house.

You'd be there for three days. Typical mortgage documents, 24 pages long. Okay. Deed is five pages long, you know, You'd be 

Mike Koelzer, Host: there for days and they'd say, well, yeah, but we'll give you this [00:30:00] ahead of time to read. It's like, well, that doesn't mean anything. How do I know you're going to put the same document in front of me?

You didn't sign the first one to agree this was going to happen. So you'd be there for three days. Yeah. Same idea with people breathing down the neck of a 25 year old, newly married couple or something, trying to say, hurry up on this. Yeah. These were 

Mark Cuker, Attorney: first time home buyers. They just really didn't know.

It's crazy. 

Mike Koelzer, Host: What's the relief that is on this pharmacist thing. I've got to think there's some money involved because your firm has to get paid. But I also know pharmacists would probably be just really happy if things changed, but there's gotta be relief there of money. It seems exactly. 

Mark Cuker, Attorney: So there's two aspects of money were, uh, claiming in, um, Actually three but two in Pennsylvania, three in California because of certain court rulings.

So first is, uh, to the extent the Mac price paid was below a national benchmark like NAIDOC. Uh, so maybe what we call an underwater claim. So it should have been, uh, at least that NAIDOC, if not above. So as the late act stands for national average drug acquisition costs set by CMS by survey, um, plus a, maybe a margin on top of that, uh, to cover some part of overhead.

So, uh, one, so, um, there is damage being claimed for that. Another form of damage is the judge ruled. Okay. You know, max stands for maximum allowable cost, right? What's maximum mean the 

Mike Koelzer, Host: maximum that they're going to pay. Too, I would think of the pharmacist. 

Mark Cuker, Attorney: Okay. But the term maximum means the most or the highest.

Yeah. And there should only be one maximum allowable cost for all pharmacies in a health plan, all pharmacies who are participating in the plan, maximum connotes the singular and, uh, you know, don't, trust me on this South Carolina legislature had hearings on this. How can you have more than one Mac price?

How can you have one Mac price for Walgreens? Another one for an independent pharmacy and a third one for CVS maximum means one. So the judge in our case ruled that we have a plausible claim that there can only be one Mac price, but we need evidence. We need evidence of how much more. Optum or Catamaran paid CVS or Walgreens or some other large chains.

And that has been hard for us to get so far. So to your listeners out there, if anyone has any evidence or any information about what Lourdes chains get, I would appreciate somehow reaching out to me. I mean, I've heard estimates of as much as $7 a script as a difference between what Laura's chains get and what independent pharmacies.

On generics, but we need, we need hard evidence 

Mike Koelzer, Host: from the very start. These PBMs had basically a monopoly. I mean, they had 25 or 50% of the business of some of these plans. 

Mark Cuker, Attorney: Yeah. Well, I mean, we know the three biggest PBMs have between 75 and 80% of the market. Not do business with someone who's 20% of your customers, 23% of your customers.

You can't, you can't write that off and stay in business. Look, there's always, so an imbalance, there's always a more powerful party in a weaker party, but you know, there's just a certain floor, minimal level of fairness. That's, that's gotta be there or it just 

Mike Koelzer, Host: doesn't work. There's always going to be a weaker and stronger.

I mean, the odds of it being the same or not there. 

Mark Cuker, Attorney: Yeah. And our society, you know, you're dealing with Amazon, you're dealing with 18 T you know, a fire idea with Verizon a lot. So, uh, you know, you're dealing with big banks, uh, but there's also laws, in some cases, there's laws to protect people regardless of what the contract says.

So, and that's, that's the really good thing about, um, all the state laws that have been passed and are continuing to be. To help and trust this because basically what the state laws are saying is that I don't care what's in the contract. You can do this for instance. Now some law states have, I'm sure you get a lot in here.

A lot about GRS and BDRs and DLR and clawbacks. And now at this point, several states have passed laws, making that illegal North Dakota, Minnesota, New Jersey wheezy end. Among them. I think Texas has probably done it all. Also recently. I'm not even current on all of them so that, you know, that affords a lot of additional protection.

So now they're, you know, now they're, um, saying, well, those laws can't be effective because of federal law preemption. That's now what their argument is, even though the U S Supreme [00:35:00] court decided nine to nothing against them. 

Mike Koelzer, Host: States have a lot of power because they can say, look, we're just not going to allow that.

And we're not going to give you a whatever, a certificate to do business in our state, whatever that's called a license, and then over to Arkansas, where the plans and can I, I guess, Sue the state and say, well, you have to give us this because we deserve it and so on, but at least then you're fighting state against company.

You're not fighting. A little can the pharmacy against a 

Mark Cuker, Attorney: company. Right, right, right. The state will fight to preserve its small. And I think the big case right now is the North Dakota case or witty to know if you know about that or not. But so since the Arkansas case was decided, the next big preemption case is the Oakleigh.

It's the North Dakota case. North Dakota has a law against clawbacks and Pacoima is fighting it. And that is in the eighth circuit court of appeals right now, awaiting a decision. I believe. 

Mike Koelzer, Host: Once a state like Arkansas and North Dakota, should they win once they win? Let's say at the Supreme court. Is that like, all right, all 50 states now do this.

Mark Cuker, Attorney: Oh yeah. Well, that's sort of that, that's what had, there's been a flood of legislation since Rutledge came down. Uh, it really has opened up the gates. Now Pacman is still going to still fight this at least for a while because they have nothing to lose. 

Mike Koelzer, Host: So let's say Arkansas wins ABC law. Doesn't every state have to go and fight their own ABC in front of the Supreme court.

Every 

Mark Cuker, Attorney: state has to pass its own. 

Mike Koelzer, Host: But the Supreme court not going to hear 50 of the similar Arkansas 

Mark Cuker, Attorney: ones. No. If everybody verbiage stayed past Arkansas is low. We'd be good. Since that law came down, you know, it's like playing whack-a-mole with the PBA, finding out these other tactics, like clawbacks and things like that.

So, um, it required some additional legislation that was not decided in the Routledge case. 

Mike Koelzer, Host: Something comes through when Arkansas goes to the Supreme. It's not really a federal law, then it's more like all the states are, they have this law. They're all saying great. Is that because nobody would be stupid enough to go in front of the Supreme court again, to hear the same argument or is there truly like a federal like mandate where all right, that's done.

No more questions. All right. 

Mark Cuker, Attorney: So here's, here's what happened in Rutledge, Arkansas past. Uh, one of the things the law said was you can't pay a pharmacy, reimbursed the pharmacy less than its acquisition cost for drugs. There's a federal law called ERISA, E R I S a employee retirement income security act.

The very well-intentioned law. This is another example of how sharp lawyers turn laws on their heads. Just like your arbitration act was a good law. Arista was a very well intentioned law designed to protect workers and families, um, who in, in employee benefit plans. Okay. That's what's the intent of the law.

Wasn't that? Optum or CVS screw pharmacies. Absolutely not. But that law basically said in certain areas, the federal law will preempt any state law. The federal law will supersede and have precedence or priority over any state law. So many, any state law occupied that area or conflicted with it. The state law.

Okay. And this was designed really for when the federal law was more protective of, um, employee benefits than the state law would be. Then you have federal protection for the last 25. Some years, big companies have used a risk. To protect big companies from states instead of our risks of being used to protect little people from big companies, they're using a risk to protect big companies from states, state Canto.

This state can't do that. I think this is what's happening in our country as no secret. A lot of paralysis on the federal level, nothing, you know, it, Congress has paralyzed in gridlock and whereas some states can take action. Of course. The interesting thing about PBM reform is it tends to be very pie.

Partisan blue states and red states have all enacted good anti PBM reform laws, but nonetheless, nothing happens on the federal level. So, um, Um, the argument is that what Arkansas did stepped on the toes of ERISA and went into a federal area where they couldn't go. And the Supreme court said, Nope. When Arkansas is just fine, however, there's 49 other states who would still have to do what Arkansas does.

In order to enable, give the pharmacies that protection. So they did not say that all 50 states have this protection for pharmacies. They said, if any other state wants to do it, they can do it. That's why you then had this flurry of [00:40:00] legislation the last nine months, I guess, since Rutledge came down where other states are regulating PBMs more aggressively because they, basically this with the Supreme court, gave them a green light.

But if they can't Supreme Court can't drive them through the intersection, they still have to drive. They still have to drive themselves through the 

Mike Koelzer, Host: intersection. So driving through the intersection is simply passing a state law. Going all the way and fighting it in front of the Supreme court. Again, it's just having the law tabbing, the law I've been told that I've been told that these states who have maybe kind of hung back and maybe, well, let's not spend time on it because it might not be a high priority because we don't know what's going to happen.

And we don't want to go in front of the Supreme court. And as everybody's going to fight it, this and that, now they can just say, Hey, if we get the law, 

Mark Cuker, Attorney: we're good. Yeah. I mean, the store law still could get challenged, but you know, my attitude, but. Go ahead and make my day, go ahead and challenge it. You know, Andrew Cuomo vetoed a law about a year ago, and it was very upsetting.

I was in touch with the Pitney folks, the pharmacy society of the state of New York out, you know, there are really good strong state organizations and it was infuriating. This was before Rutledge came down and Cuomo vetoed it on the grounds that he thought that. Would be preempted by a risk. And a problem is a lawyer enlist.

He's obviously a smart guy, whether you like him or not, certainly a very smart guy, but what was infuriating about it is his own attorney general, but Tisha James had written in an Amicus brief. That's a friend of the court brief in Rutledge telling the Supreme court why these laws, why the Arkansas law is not preempted.

In other words, his own attorney general disagreed. Is there any Turner general who thought the law was perfectly fine? He didn't listen to his own attorney now. And you know, she did a couple of things that last couple of weeks, he didn't care for it. You know, let's, let's, let's, let's be fair. He does not, he does not appoint her.

He does, she is separately elected. So when I say his own attorney general, you know, she is separately elected. He did. And the pointer, nonetheless, she is the chief legal officer of the state of New York. And she knows what she's doing. So you would think the governor would at least pay attention to what she said.

Mike Koelzer, Host: Garlic Cuomo again, take away any likes or dislikes of him. Is his decision not to do that? Do you think we can just take that at face value that he just didn't think the federal head would bow down to the state there? Can we take that at face value or do I always look and say, well, he's bought off by this group and that group and he's from New York.

So you gotta be careful about that, 

Mark Cuker, Attorney: you know? Well, well, okay. So first of all, um, they just, I believe passed another set of laws in New York. And I mean, he's resigning effectively. Another few days. He may actually have signed the new law. I don't know. So in all fairness, one should wait to see what happens with that new set of laws.

It's either two or two or two, three or four separate laws that have been passed by the New York legislature and are waiting for the governor's signature. So in all fairness to him, now that Rutledge came down. If he signs the laws or at least he doesn't veto them and lets the new governors sign them, then you know that, that would give you an answer, whether it's the answer or not.

You know, I mean, I don't think anybody ever can read the mind of what's what's influencing a politician. Um, typically, you know, they're only influenced by what would get them re-elected, you know, that's we all know that. So I don't, I don't know why he vetoed it. I really don't understand it. Um, but anyway, hopefully this round will get signed and uh, The issue with this, then go away.

Mike Koelzer, Host: The PBM fight is you and I going to be long, gone off this earth, and this is just going to keep going and going and going. Or is there ever a time when. And maybe the time was, you know, last month when your lawsuits came through, is there ever a time when we kind of turned that corner or is this always just going to be, you know, frontline fighting for the rest of our lives and maybe some progress, but never a real and to it, that's a 

Mark Cuker, Attorney: tough question.

Um, I certainly would have. That. I mean, we intend to hold them accountable for what they've done and to create, help create, because we can't do it alone through litigation, but between legislation and litigation and educating the citizens and the voters, um, create a system that affords. Independent business defense, some stability and predictability, and the ability to maintain, make a living doing what they do.

You know, small business is so important. People need a choice. You know, we pat ourselves on the back in this country and say, we have a free market, but this whole PBM system is the antithesis [00:45:00] of a free market. They take away your choice. They force you to mail-order. They force you to do this. They force your doctor.

To prescribe certain drugs on a formulary, even though they may not be basically the best for you, they have in the name of free enterprise. And then they, you know, they've used their power to thwart a free market and many levels at the consumer level, at the small business level and independent pharmacists provide a level of service.

You know, I. I think most people would agree it is better than most chains, so that needs to be preserved. So all I can say is I, you know, I can't predict what's going to happen, but I would hope and think that people would see that, um, this is the system as it is, uh, still stands the free market on his head.

It's dysfunctional and it needs to have doctrine in the law. And we. Litigation is one of the tools that can help bring that about. 

Mike Koelzer, Host: You're pretty confident that at least for your efforts is going to happen. You pretty 

Mark Cuker, Attorney: confident. Well, yes. I mean, look, you never can predict the outcome of a case, but I know that I've seen their pricing and some of their pricing is at levels so low.

It cannot be mostly justified by any wholesale market data. You've got some drugs, they're paying 50% of NASDAQ. You know, for instance, it cannot be justified. If that goes before a finder of fact, I can't imagine any jury that understands the case, understands what is ruling in favor of them.

They would have to rule in favor of us that the pricing was not just unfair and violated the terms of the contract and violated the state Mac law and Optum has to pay. Their whole legal strategy was not concocted around having a defensible price who has concocted around being able to keep us from getting to court by blocking us with the arbitration clause.

And they lost that and they lost that, 

Mike Koelzer, Host: That wasn't by chance they knew they were screwing us and they knew there'd be no way to battle them in court. That's 

Mark Cuker, Attorney: exactly right. I've seen companies do this before. I had a case against a payday loan. Uh, charged an interest rate of 648% on a loan. So how does any lender work?

Okay. No lender lends its own money. Alright. No lender lends its own money. Doesn't happen. Lender gets money from somebody else. Okay. Who is in the warehouse? Lender room or that kind of funding. So there was this payday lender that cut a deal with. And the bank said, we'll lend you the money to then lend people at 648% interest.

Okay. And the contract between the bank and the payday lender required the payday lender to have an arbitration clause in its contract with the poor Schmo, who's paying the user Prius interest. Okay, because, and it specifically said if that arbitration clause goes, our deal 

Mike Koelzer, Host: is off. And let me guess it wasn't out of the goodness of their heart like free arbitration.

It was one of those that we're talking about here. 

Mark Cuker, Attorney: Yeah. You couldn't have a class action. You couldn't have a mass action. So therefore who's going to bring a lawsuit for like $400 for women who borrowed $200. She had to pay 400 a month later. So yeah, it was all the entire business model was premise. Uh, get basically immunity.

They basically contracted themselves into being immune from suit. I like what 

Mike Koelzer, Host: You said that this is going to be a trial by jury. Yes. Which I think plays into the unconscionable ness of the case because it's like, The PBMs going to throw all these numbers around and the pharmacy is going and all this stuff and blah, blah, blah, and all these different terms in Nabriva creations and all that stuff.

But when it comes down to it, it just doesn't seem fair. Yeah. I think people 

Mark Cuker, Attorney: have a doctrine in the law sense of fairness. People. They know that, you know, you know, you run a business, you have to get your ingredients, cost, bam, and pay for your overhead people. Roofie, you got, you have salaries, you got rent. You gotta pay for healthcare, health insurance for your employees for crying out loud.

That's a pretty big nugget of substantial numbers. 

Mike Koelzer, Host: We have a lot of different types of listeners, but let's say it's a pharmacist listening right now. Let's say it's a pharmacy owner listening right now. Is there anything they can do this week? Can they get a hold of their state and tell them how our fight is going?

Or what might they do? 

Mark Cuker, Attorney: Well, they should certainly reach out to their state, a pharmacy organization to keep abreast of legislative efforts in their states. I'm aware of several, probably more than several. 10 to 15 really active state pharmacy organizations. There may be a lot more out there than just not aware of, [00:50:00] but I know for instance, Louisiana is very strong.

Arkansas is strong , Georgia, strong New York is strong. Um, California street. Um, I was strong, you know, uh, and there's others. I, I, I don't mean to insult anybody if I left some names out, you know, sorry, 

Mike Koelzer, Host: It's a good sign. There's a lot of them though. 

Mark Cuker, Attorney: And they're all becoming more energized and active. Yeah. But you know, that's one thing they can do.

And I think they may want to think about joining our case, you know, and if they want to do that, they can reach out to me or people in my firm or talk to another lawyer about bringing another kind of case. There are other illegal actions that they do. We haven't talked about it. For instance, one thing they did a couple of things for one thing is they're now Volvo violating their anti-coal back laws and a bunch of states you're still clawing money back.

It's illegal. They don't give a damn they're still doing it. They act like they're above. Secondly, we know that there are some scripts where they pay the pharmacist age, generic Mac price, and build a plan for. And collect your spreads. We know that happens. We think that's illegal. And that's part of our case in Illinois, in California, that we intend to still pursue there's guide those, any, any other number of shenanigans and games they play.

Uh, they are very creative. Uh, at that, that I probably don't even know about and I'm happy. I, you know, I still consider myself on a learning curve here and I'm happy to talk. I will talk to any pharmacist, any place in the country, anytime, remotely convenient, just to hear what they have to say and see what I can.

Mike Koelzer, Host: Well, mark, thanks for your leadership. Like I say, boy, when I saw that a couple months ago, I'd seen enough fights go in front of me and legal things going in front of me and all that kind of stuff. And when I see something big. I can tell it's big. Anybody can, we've seen enough stuff when we know something's big and this was big.

And thank you for leading us into 

Mark Cuker, Attorney: it. Well, you're very welcome. I'm really thrilled, but this is just the first we're going to have more victories for this is over. So I'll keep you informed. I expect we will have more. I'm not a cocky guy. I'm not a bragger. I'm not bragging, but I'm telling you we're going to win more in this.

Mike Koelzer, Host: The same that you said you're not a bragger and a cocky guy. I understand that because PBMs have taken us the other direction where pharmacists have turned into a bunch of bitching. I have fun picking on the teachers. My wife's a teacher. So I, I have fun by saying we sound like a bunch of teachers sitting around bitching in the teacher's lounge.

You know what I mean? That's like not. R, but we've been so beaten down that it happens. And so when it turns the other way, it's fun to be excited and send my wife a link to your article and things like that, because we've had this swing of emotion going the negative way that we all deserve to have a positive swing of emotion, 

Mark Cuker, Attorney: to a little bit of world war II analogy.

I like to say these victories are not the end. They're not the beginning of the end. They are the end of the beginning. That was Churchill Churchill after the battle of El Alamein. 

Mike Koelzer, Host: Good words. All right, mark. We'll certainly keep in touch. 

Mark Cuker, Attorney: Thank you very much. Appreciate your having me. Thanks for 

Mike Koelzer, Host: everything.

All right. Talk to you again. Take care. Bye-bye.