Citing a contract dispute, Express Scripts is threatening to strip CareZone, a startup that delivers medications to customers, from its network, CNBC reports.
CareZone can't accept insurance without a pharmacy benefits manager, which is why it teamed up with Express Scripts. However, Express Scripts is accusing CareZone of misrepresenting itself as a retail pharmacy when it was actually a mail-order pharmacy — the same claim Express Scripts made against PillPack in 2016 — and is alleging it shipped drugs to states it wasn't licensed in.
CareZone CEO Jonathan Schwartz is denying these allegations and told CNBC his company has licenses in all 50 states. Mr. Schwartz also disputes the PBM's claim that CareZone isn't a retail pharmacy. He started the company in 2012 as a medication management app, then later created CareZone Pharmacy Services to deliver drugs. Customers use the app to sign a consent form that enables CareZone to deliver their medications.
Mr. Schwartz said CareZone would lose nearly 900 customers, many of whom are low-income patients in rural areas, some with multiple chronic illnesses. He sent customers a email in mid-June to inform them of Express Scripts' plans — which would go in effect July 13 — and urging them to call the PBM to keep its deal with CareZone.