JPMorgan Chase employees may sue over high drug costs and premiums, judge rules

By Jonathan Stempel

NEW YORK, March 9 (Reuters) - A national justice ruled connected Monday that JPMorgan Chase employees whitethorn prosecute portion of their suit ‌accusing the largest U.S. slope of mismanaging its wellness and medicine benefits ‌program, causing them to overpay for medicine drugs and premiums.

U.S. District Judge Jennifer Rochon successful Manhattan said ​employees tin effort to beryllium that JPMorgan allowed repeated, unauthorized excessive payments to CVS Caremark, to payment the pharmacy benefits manager and debar "blowback" from healthcare clients.

The projected people enactment connected behalf of tens of thousands of employees accused JPMorgan of violating the Employee ‌Retirement Income Security Act of ⁠1974 (ERISA) by utilizing a "fundamentally flawed" process to prosecute CVS Caremark, whose genitor CVS Health is an concern banking client.

It besides said ⁠JPMorgan knew of imaginable areas to chopped costs, reflecting Chief Executive Jamie Dimon's engagement with Amazon.com's Jeff Bezos and Berkshire Hathaway's Warren Buffett successful trying to amended worker healthcare. ​Their unsuccessful ​joint task Haven unopen down successful 2021.

Lawyers ​for the employees did not ‌immediately respond to requests for comment. JPMorgan and its lawyers did not instantly respond to akin requests.

According to the complaint, JPMorgan fto CVS Caremark people up prices of 366 generic drugs by an mean 211%, causing immoderate employees to wage much than uninsured patients.

One drug, the aggregate sclerosis medicine teriflunomide, was marked up much than ‌38,000% to $6,229.23 from $16.20 for a 30-unit prescription, the ​complaint said.

In her 34-page decision, Rochon dismissed claims ​that JPMorgan breached fiduciary duties ​of loyalty and prudence, saying "decisions astir associated ventures, firm strategy, oregon ‌relationships with 3rd parties bash not ​become fiduciary acts simply ​because defendants besides sponsor an ERISA plan."

She besides said the slope whitethorn person ample defenses to the surviving claims pursuing a U.S. Supreme Court ​decision past April that said ‌ERISA plaintiffs request lone plausibly allege that defendants engaged successful "prohibited transactions." Defendants ​may rise imaginable exemptions arsenic an affirmative defense.

(Reporting by Jonathan Stempel ​in New York; Editing by Mark Porter)