CVS Caremark is a leading health care company that has made a significant impact on the industry. It was founded in 1999 through the merger of CVS Pharmacy and Caremark Rx.
CVS Caremark operates a large retail pharmacy chain with over 9,900 locations across the United States. The company also offers a range of health care services, including pharmacy benefit management and mail-order pharmacy services.
The company's pharmacy benefit management (PBM) services allow it to process prescriptions for millions of people. As of 2020, CVS Caremark managed over 1.3 billion prescriptions annually.
CVS Caremark's mail-order pharmacy services offer convenient and cost-effective options for customers. The company's mail-order pharmacy has shipped over 100 million prescriptions since its inception.
For your interest: In Re Caremark International Inc. Derivative Litigation
Company News
CVS Caremark has been ordered to pay $289.9 million in damages and penalties for inflating Medicare Part D prescription drug costs.
The judgment stems from a whistleblower lawsuit filed by Sarah Behnke, a former Aetna actuary, who exposed the scheme in 2014.
Caremark submitted false drug cost reports during 2013 and 2014, resulting in $95 million in Medicare overcharges.
Philadelphia federal Chief Judge Mitchell Goldberg found Caremark's conduct reflected reckless disregard and willful ignorance, though not actual knowledge of fraud.
The False Claims Act allowed Judge Goldberg to triple the initial damages and add a civil fine of $4.87 million, bringing the total to nearly $290 million.
CVS plans to appeal the ruling, but interest will continue to accrue on the judgment until full payment.
This is not the first time CVS has faced a major legal setback, as its Omnicare unit was required to pay nearly $949 million in a separate fraud case earlier this year.
A fresh viewpoint: Bcbs Caremark
Company Information
CVS Caremark is a leading healthcare company that was founded in 1963 by Stanley Goldstein, Sidney Goldstein, and Ralph Hoagland.
The company's first store was opened in Lowell, Massachusetts, and it was initially called the Consumer Value Stores.
CVS Caremark is headquartered in Woonsocket, Rhode Island.
The company's name was changed to CVS Corporation in 1996, and it was later renamed CVS Health in 2014.
In 2019, CVS Health merged with Aetna, a health insurance company, to become CVS Health Corporation.
A unique perspective: Phillip Goldstein (investor)
Insights and Analysis
A federal judge has ordered CVS Caremark to pay almost $290 million in damages and penalties after a whistleblower proved the pharmacy benefit manager overcharged Medicare for prescription drugs.
The damages were tripled to $285 million and a $4.9 million civil fine was added, bringing the total to almost $290 million. CVS tried to convince the judge to decrease the penalty, but was unsuccessful.
CVS plans to appeal the ruling, so this is not the final word on the matter. The company's decision to appeal suggests they disagree with the judge's assessment of the damages.
Here are the key details of the ruling:
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