The lawsuits swirling around
could soon give the governor of Florida a headache.
Two former Caremark pharmacists have announced plans to subpoena Jeb Bush as part of their whistleblower lawsuit against the company. Michael and Peppi Fowler have accused Caremark of defrauding -- and even endangering -- Florida customers by failing to properly fill their prescriptions. They have also suggested that the state has protected Caremark at the public's expense.
In a rare twist, the Fowlers recently blocked the state from intervening in their case after raising concerns about potential conflicts. Most whistleblowers welcome government assistance, but the Fowlers worried that state officials might be influenced by their ties to the company. Based on the latest court filing, the whistleblowers now question whether the pharmacy benefit manager received favorable treatment from the highest political office in Florida.
Specifically, the Fowlers are seeking to discover whether Bush corresponded with Caremark CEO Mac Crawford about the company's performance -- and about an alleged "tainted drugs issue" in particular. They also want any communications between the two parties involving a powerful lobbying firm, employed by Caremark, that enjoys a warm relationship with the governor.
The latest request comes as the whistleblowers prepare for a rare deposition of the company's CEO. In the new filing, however, the Fowlers make clear that they are simply seeking documents -- rather than actual testimony -- from the governor's office.
Still, Taxpayers against Fraud, a legal group that supports whistleblower cases, portrayed the latest development as "extremely unusual."
"But there seems to have been some serious conflict-of-interest problems in the Caremark case," says Patrick Burns, a spokesman for the group. "This case is making a lot of history for a lot of different reasons."
Caremark, which mails prescriptions to client customers, declined to comment. The governor's office failed to return a telephone call from
. The company's stock slipped 18 cents to $32.11 on Friday.
The Fowlers have accused Caremark of changing, shorting and even destroying customer prescriptions in an effort to maximize profits. But they also make one allegation that has yet to be lodged against others in the embattled pharmacy benefit management industry. They claim that Caremark sold customers prescriptions that had been returned through the mail without first testing the drugs for damage.
Over time, the complaint has gone on to take aim at the state of Florida as well. It hints at several potential conflicts. It points out that a state prosecutor -- who intervened in the case at Caremark's request -- formerly worked at the law firm now representing the company. (The prosecutor, David Moye, has since left office.) It also claims that a state official who praised Caremark's performance accepted free trips from the company as a member of its special advisory board. Some questioned whether the official violated the governor's strict ethics code in the process.
The governor's office itself said it was examining the matter. But the governor has attracted some scrutiny of his own.
Public Citizen, a nonprofit consumer advocacy group, notes that Bush employed Caremark director C. David Brown as the central Florida finance chief for his gubernatorial campaign. The group says that Brown raised at least $200,000 in campaign funds -- earning him elite "Ranger" status -- for President Bush as well.
Interestingly, whistleblowers have raised questions about both brothers in the past. One claimed that Jeb Bush flew to Nigeria in a plane filled with suitcases of cash used in an alleged bribery scheme carried out by his former business partner, according to the
. Another accused the current president of interfering with a government probe of a company owned by a family friend when he served as governor of Texas, the
The Florida governor has always stressed that the Nigerian case -- which attracted government intervention -- excludes him as a specific target. But whistleblowers are once again questioning the governor's behavior. In their latest court filing, the Caremark whistleblowers have asked Gov. Bush for information about an alleged incident involving Caremark's distribution of "tainted drugs" in April 2002, and a meeting between Caremark's CEO and the governor that supposedly took place just two months later.
As previously reported by
in July, the plaintiffs claim that the state failed to protect customers after Caremark sold "drugs from unknown origin" to Florida customers three years ago. The state "did not further investigate Caremark's buying practices with respect to the purchase and sale of drugs ...
and allowed Caremark to handle that occurrence wholly internally," a past court filing states.
Several sources, including a state attorney who helped oversee the Caremark contract, confirmed that the incident did in fact take place. Mallory Harrell, the former deputy secretary of the Florida Department of Management Services, said that state investigators were "looking into the potential sale of drugs on the black market in Miami, and Caremark's name came up" in 2002.
She said the state worried that Caremark may have purchased some sensitive autoimmune medications from First Choice Pharmaceuticals that were not properly tracked and, therefore, suspect. But she said that Caremark speedily contacted state customers who might have been impacted and handled the entire situation quite admirably.
She went on to say that the state was "obviously worried" about the situation -- and even informed the governor's office -- but "didn't want to throw everyone into a panic."
Fare Thee Well
The whistleblowers have now specifically asked Bush for any related communications between himself, Harrell and other state officials. They have also requested correspondence that mentions a lobbying firm -- Southern Strategy -- that is allegedly favored by Bush.
Caremark employs a well-placed lobbyist from that firm. Christopher Dudley served as chief of staff for Bush's original lieutenant governor before joining Southern Strategy. Dudley also counts Wachovia -- a big fan of Caremark's stock -- among his major clients.
St. Petersburg Times
reported earlier this year that businesses that have hired Southern Strategy, including Caremark, have "fared well getting state contracts." Caremark currently provides pharmaceutical services to 200,000 state customers in a deal worth $153 million annually.
Still, even Burns expressed some surprise that Bush now faces a subpoena about his relationship with the company.
"This is the governor of Florida," he says. "I think there has to be some explanation as to why" this is happening.