Latest News

Senate defense bill has $66M less for Wright-Patt project than House

Ex-pharmacy benefit manager CEO pleads guilty to paying kickbacks


The former chief executive of a Nebraska pharmaceutical benefits manager company has pleaded guilty to making illegal kickback payments in order to obtain business from employer health plans.

Douglas Pick, 57, pleaded guilty in federal court in Tyler, Texas, on Monday to making unlawful kickback payments, and his former company, Pharmaceutical Technologies Inc., agreed to pay more than $8.5 million as part of a non-prosecution agreement with the U.S. Attorney’s Office.

The Dayton Daily News has been reporting on the role of pharmacy benefit managers as part of a series on rising prescription drug prices.

READ MORE: Who’s really controlling your drug prices? 5 things to know about pharmacy benefit managers

PBMs work on behalf of health plan sponsors to negotiate rebates from drug makers and administer prescription benefits. They have control over which drugs a health plan will cover, how much out-of-pocket patients will pay and which pharmacy members can use.

PBMs have been criticized for a lack of transparency in their negotiations with drug makers and accused in lawsuits of inflating drug prices. PBMs say they save health plans millions by negotiating large rebates and driving members to the lowest cost drug options.

RELATED: Consumers kept in the dark over drug prices

Pharmaceutical Technologies paid individuals kickbacks to steer health plan business to it, the case revealed.

In one example Tom Slack, CEO of Tyler-based HealthFirst, was paid more than $1.5 million to ensure Pharmaceutical Technologies kept its contract to administer pharmacy benefits for HealthFirst plans.

IN-DEPTH REPORT: Read and watch the full investigation into prescription drug prices

The agreement specified that HealthFirst would pay PTI an administrative fee for every claim made for the filling of prescriptions, according to the U.S. Attorney’s Office, Eastern District of Texas.

“Slack expressed to Pick that he wanted to personally receive money on the pharmacy business from HealthFirst in exchange for directing more business to PTI and automatic renewal of the PTI-HealthFirst agreement each year,” a statement from the district office said. “To do so, Pick and Slack agreed that Slack would approve an increase of the PTI administrative fee imposed on HealthFirst’s clients for each prescription filled. PTI would then pay the increase to a shell company that Slack had established.”

READ MORE FROM THIS SERIES

Dayton man lead plaintiff in drug suit alleging price-gouging

Insulin makers accused of price-fixing scheme

$180,000 price tag for Miami Twp. boy’s prescription

Video guide: How do prescription drug prices get set?

Different prices at different pharmacies: Why?



Reader Comments ...


Next Up in Local

Grand jury indicts defendant accused of using pruning shears to stab a man
Grand jury indicts defendant accused of using pruning shears to stab a man

A Montgomery County grand jury Friday indicted 53-year-old James Freshour of Dayton stemming from an attack earlier this month during which he used pruning shears to stab a man. Freshour was arrested at the scene. He remains in the county jail on two counts of felonious assault. He is scheduled to be arraigned May 31, according to online court records...
Central State says grad’s dance on stage will cost him $300
Central State says grad’s dance on stage will cost him $300

A Central State University graduate said he can’t get a job in his field of study because he did a dance during graduation. Dwayne Davis said the school fined him $300, and that he can’t get his full transcripts to show potential employers until he pays up. “I don’t have $300. I just graduated college. I don’t have $300...
Senate defense bill has $66M less for Wright-Patt project than House
Senate defense bill has $66M less for Wright-Patt project than House

The Senate Armed Services Committee has set aside $116 million for a National Air and Space Intelligence Center complex expansion at Wright-Patterson, millions less than a House version in a defense bill, but a spokeswoman says U.S. Sen. Rob Portman will advocate for the full amount. The $182 million project would vastly expand NASIC, add new computer...
Dayton schools to tweak graduation ceremonies after families shut out
Dayton schools to tweak graduation ceremonies after families shut out

Dayton Public Schools will make two changes to its graduation ceremonies next year, after some families weren’t able to see their students graduate this week, and district officials said there was an issue with falsified tickets. More than 100 people were told they could not enter the Dayton Masonic Center on Thursday when they arrived for Ponitz...
Ivanka Trump defends Serena Williams, slamming her status as unseeded at French Open
Ivanka Trump defends Serena Williams, slamming her status as unseeded at French Open

Ivanka Trump is defending tennis great Serena Williams and slamming Williams’ lack of seeding at the French Open, calling it a penalty for being pregnant. >> Read more trending news  “This is ridiculous,” Trump said on Twitter. “Serena Williams is a formidable athlete (best ever) and loving new mother. No...
More Stories