Union Accuses Express Scripts Of Illegally Hiding Billions In Drug Company Kickbacks

The Plumbers’ Welfare Fund, Local 130 U.S., a Chicago-based union, has filed a proposed class action lawsuit against Express Scripts, the largest American pharmacy benefit manager (PBM). The union alleges in its complaint that Express Scripts violated the Racketeer Influenced and Corrupt Organizations Act (RICO) by using a Swiss group purchasing organization (GPO) to divert fees it received from drug companies in exchange for preferred placement on prescription drug formularies for each insurance plan. 

According to the union, Express Scripts used GPO Ascent Health Services to hide billions in fees from the union that it could have used to defray class members’ insurance costs. The union claims that Express Scripts, as well as its parent companies, Cigna Group and Everworth Health Services, used the formulary fees to increase its profits rather than pass on the savings to the insured parties. As a result, Express Scripts allegedly breached its duties to help the union and its members save money and protect their interests. The case is Plumbers’ Welfare Fund, Local 130 U.A. v. Express Scripts et al., Case Number 1:26-cv 01718, U.S. District Court for the Northern District of Illinois.

As proof of the alleged RICO violations, the union pointed to 2024 PBM reports from the federal Office of Personnel Management (OPM) and the Office of the Inspector General (OIG), as well as from the House Committee on Oversight and Accountability. The union also based its lawsuit on a pending case filed by the Federal Trade Commission (FTC) against the country’s biggest PBMs, including Express Scripts, Optum Rx, and Caremark, for falsely inflating insulin prices. 

In addition to the union class action and the FTC lawsuit, Congress’s passage of the Consolidated Appropriations Act of 2026 will significantly change certain elements of the traditional PBM business model. For instance, the changes will force the PBM industry to focus on fees and cost transparency rather than being the sole beneficiary of rebates. Violations of the Act could result in significant civil penalties and legal enforcement action by the U.S. government. 

The union litigation focuses exclusively on the fee practices that the PBM utilizes. According to the union, Cigna’s former chief medical officer has publicly stated that its usage of Ascent Health has allowed it to double- and triple-dip on fees. The “fees” that Ascent receives from drug companies amount to bribes and kickbacks for more favorable inclusion of their drugs on formularies over competitors’ drugs. rather than “rebates” or “manufacturer administrative fees.” 

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