Caremark Sinks on State Probe

Caremark Rx ( CMX) sank 4% early Friday after the pharmacy benefits manager said 19 states are looking into its business practices.

The Nashville, Tenn., company said Washington state's attorney general sought information about its business practices. The information request, known as a civil investigative demand, relates to consumer protection statutes and business practices conducted separately by Caremark Rx and its recently acquired AdvancePCS unit.

The company also said Washington told it that administrative subpoenas would be coming from the attorneys general in 18 other states.

Caremark said it believes that its business practices comply in all material respects with applicable laws and regulations. The company intends to fully cooperate with the requests for information.

The probe comes on the heels of a bizarre turn of events in a Florida whistleblower case. There, the company actually invited the state to join the case amid questions about undisclosed potential conflicts.

On Friday, Caremark dropped $1.20 to $31.

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