A whistleblower lawsuit against Caremark ( CMX) keeps hitting some odd notes. Two whistleblowers are seeking to block the Florida attorney general from intervening in their case. Normally, whistleblowers invite government assistance. But new court filings, including sworn statements made public for the first time, show a clear lack of harmony between the two parties. Essentially, Caremark pharmacists Michael and Peppi Fowler claim that conflicted Florida officials are more interested in protecting Caremark, a Nashville, Tenn., pharmacy benefit manager that has a big contract with the state, than in prosecuting what they call serious wrongdoing. The Fowlers also accuse Caremark leaders of engaging in the very activities, such as improperly obtaining drugs and violating privacy laws, that have called their own character into question. The Fowlers came under fire this year after filing a whistleblower lawsuit that accuses the company of defrauding and endangering Florida customers by, among other things, selling them drugs that were returned through the mail but never tested for potential damage. Chicago lawyer Mike Leonard, who is representing the whistleblowers, has pegged potential damages to Florida customers alone at more than $100 million. A judge is set to determine next week whether the whistleblowers or the Florida attorney general deserves control of the high-stakes case. Caremark is betting on the latter. "We believe the overwhelming weight of evidence against these plaintiffs and their scandalous, meritless accusations will lay this issue to rest," says Caremark spokesman Gerard Carney. "We support the state's intervention." On Friday, Caremark dropped 14 cents to $31.12.
Earlier this month, for example, former hourly worker Yesenia Garcia -- a non-pharmacist employed in Caremark's "returned goods" room -- reported that she used to decide whether returned drugs should be destroyed or restocked for future sale simply by eyeballing the packages. "I don't know nothing about drugs or what to throw away," Garcia said in her statement. "But ... that's what they told me to do." Garcia, who left Caremark voluntarily, went on to express discomfort with the company's business practices. She did say that Caremark later invested the restocking decisions with pharmacists instead. But she also described a more troubling change that followed that development. She said that she was ordered to start falsifying computer records to conceal the restocked drugs. And according to Garcia's testimony, not until last year -- after the whistleblowers filed their suit -- did Caremark finally stop restocking drugs altogether. Caremark has said in the past that it restocked only a tiny fraction of its drugs and no longer engages in the activity. It has also consistently defended its business practices and portrayed the entire whistleblower lawsuit as baseless. "This case should be tried in a courtroom where it belongs, not in the press by way of inflammatory proceedings improperly asserted as facts -- matters that are vigorously contested," Caremark spokesman Carney says.
Bochard also said Caremark routinely canceled prescriptions without ever communicating with a physician first. He described the faxed requests to the prescribing physicians as misleading. "I think if they read it, they thought the patient was going to get something," he said. "I mean, what doctor would sign that and then know that we weren't going to send out anything at all?" The whistleblowers' latest documents also turned the tables on accusations over the pair's actions. Caremark has claimed Peppi Fowler improperly obtained thousands of "highly addictive painkillers" for her sister at the company's expense. The whistleblowers have never disputed this allegation, but now they say the medication was non-narcotic in nature. Their filing also claims that Caremark's own CEO, Mac Crawford, performed a similar favor for a neighbor who also wasn't qualified for Caremark benefits. The Fowlers have been accused by Caremark of violating patient confidentiality laws as well. In response, they now claim that Caremark itself displayed a total disregard for patient privacy when its lawyers sought information from the doctor caring for Fowler's sister. In a sworn affidavit, physician Richard Hiltner testified that Caremark lawyers questioned him twice -- once with a court reporter present -- about prescriptions he wrote for the relative in Peppi Fowler's name. He further stated that the attorneys instructed him not to tell his patient he had disclosed her information, although he did so anyway. Meanwhile, the federal government has displayed some interest in the case. Earlier this week, a federal agency
subpoenaed Leonard for a slew of documents related to the whistleblower complaint. More than a dozen state attorneys general outside Florida are investigating the company as well. Caremark shrugs it all off. Whistleblower lawyer Leonard "spent a year trying to get the state involved in this case," Caremark spokesman Carney adds. "Now he's dedicating most of his time to getting them out. His tactics are becoming increasingly desperate."