A federal judge has dismissed antitrust claims brought by Brandywine Hospital in Coatesville, Pa., and Reading Hospital in West Reading, Pa., against CVS Health, ruling the hospitals failed to plausibly define relevant product markets in their challenge of CVS’ 340B contract pharmacy practices.
The March 3 ruling from the U.S. District Court for the Eastern District of Pennsylvania found the hospitals did not establish that CVS’ contract pharmacy services formed a valid single-brand tying market, nor did they show anticompetitive harm in the tied market for third-party administrator services.
The hospitals alleged CVS unlawfully forced 340B-covered entities to use its Wellpartner TPA to access discounted drug pricing through CVS pharmacies, violating Sections 1 and 2 of the Sherman Act. However, Judge Mia Perez ruled the plaintiffs’ market definitions were too narrow and that patients’ pharmacy choices were driven by convenience and insurance factors, not CVS control.
The court also dismissed all claims against CVS Health Corp. for lack of personal jurisdiction, noting it neither transacts business nor maintains operations in Pennsylvania.
