Notice2026-15913
Caremark and Zinc Health Services; Analysis of Proposed Agreement Containing Consent Order To Aid Public Comment
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
August 5, 2026
Issuing agencies
Federal Trade Commission
Abstract
The consent agreement in this matter settles alleged violations of Federal law prohibiting unfair methods of competition. The attached Analysis of Proposed Agreement Containing Consent Orders to Aid Public Comment describes both the allegations in the complaint and the terms of the consent order--embodied in the consent agreement-- that would settle these allegations.
Full Text
<html>
<head>
<title>Federal Register, Volume 91 Issue 149 (Wednesday, August 5, 2026)</title>
</head>
<body><pre>
[Federal Register Volume 91, Number 149 (Wednesday, August 5, 2026)]
[Notices]
[Pages 50535-50539]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2026-15913]
=======================================================================
-----------------------------------------------------------------------
FEDERAL TRADE COMMISSION
[Docket No. 9437]
Caremark and Zinc Health Services; Analysis of Proposed Agreement
Containing Consent Order To Aid Public Comment
AGENCY: Federal Trade Commission.
[[Page 50536]]
ACTION: Proposed consent agreement; request for comment.
-----------------------------------------------------------------------
SUMMARY: The consent agreement in this matter settles alleged
violations of Federal law prohibiting unfair methods of competition.
The attached Analysis of Proposed Agreement Containing Consent Orders
to Aid Public Comment describes both the allegations in the complaint
and the terms of the consent order--embodied in the consent agreement--
that would settle these allegations.
DATES: Comments must be received on or before September 4, 2026.
ADDRESSES: Interested parties may file comments online or on paper by
following the instructions in the Request for Comment part of the
SUPPLEMENTARY INFORMATION section below. Please write ``Caremark;
Docket No. 9437'' on your comment and file your comment online at
<a href="https://www.regulations.gov">https://www.regulations.gov</a> by following the instructions on the web-
based form. If you prefer to file your comment on paper, pleasemail
your comment to: Federal Trade Commission, Office of the Secretary, 600
Pennsylvania Avenue NW, Mail Stop H-144 (Annex I), Washington, DC
20580.
SUPPLEMENTARY INFORMATION: Pursuant to section 6(f) of the Federal
Trade Commission Act, 15 U.S.C. 46(f), and FTC Rule 2.34, 16 CFR 2.34,
notice is hereby given that the above-captioned consent agreement
containing a consent order to cease and desist, having been filed with
and accepted, subject to final approval, by the Commission, has been
placed on the public record for a period of 30 days. The following
Analysis to Aid Public Comment describes the terms of the consent
agreement and the allegations in the complaint. An electronic copy of
the full text of the consent agreement package can be obtained at
<a href="https://www.ftc.gov/news-events/commission-actions">https://www.ftc.gov/news-events/commission-actions</a>.
You can file a comment online or on paper. For the Commission to
consider your comment, we must receive it on or before September 4,
2026. Write ``Caremark; Docket No. 9437'' on your comment. Your
comment--including your name and your State--will be placed on the
public record of this proceeding, including, to the extent practicable,
on the <a href="https://www.regulations.gov">https://www.regulations.gov</a> website.
We encourage you to submit comments through the <a href="https://www.regulations.gov">https://www.regulations.gov</a> website. Postal mail addressed to the Commission
will be subject to delay because of heightened security screening. If
you prefer to file your comment on paper, write ``Caremark; Docket No.
9437'' on your comment and on the envelope, and send it via overnight
service to: Federal Trade Commission, Office of the Secretary, 600
Pennsylvania Avenue NW, Mail Stop H-144 (Annex I), Washington, DC
20580.
Because your comment will be placed on the publicly accessible
website at <a href="https://www.regulations.gov">https://www.regulations.gov</a>, you are solely responsible for
making sure your comment does not include any sensitive or confidential
information. In particular, your comment should not include sensitive
personal information, such as your or anyone else's Social Security
number; date of birth; driver's license number or other State
identification number, or foreign country equivalent; passport number;
financial account number; or credit or debit card number. You are also
solely responsible for making sure your comment does not include
sensitive health information, such as medical records or other
individually identifiable health information. In addition, your comment
should not include any ``trade secret or any commercial or financial
information which . . . is privileged or confidential''--as provided by
section 6(f) of the FTC Act, 15 U.S.C. 46(f), and FTC Rule 4.10(a)(2),
16 CFR 4.10(a)(2)--including competitively sensitive information such
as costs, sales statistics, inventories, formulas, patterns, devices,
manufacturing processes, or customer names.
Comments containing material for which confidential treatment is
requested must be filed in paper form, must be clearly labeled
``Confidential,'' and must comply with FTC Rule 4.9(c). In particular,
the written request for confidential treatment that accompanies the
comment must include the factual and legal basis for the request and
must identify the specific portions of the comment to be withheld from
the public record. See FTC Rule 4.9(c). Your comment will be kept
confidential only if the General Counsel grants your request in
accordance with the law and the public interest. Once your comment has
been posted on the <a href="https://www.regulations.gov">https://www.regulations.gov</a> website--as legally
required by FTC Rule 4.9(b)--we cannot redact or remove your comment
from that website, unless you submit a confidentiality request that
meets the requirements for such treatment under FTC Rule 4.9(c), and
the General Counsel grants that request.
Visit <a href="https://www.ftc.gov">https://www.ftc.gov</a> to read this document and the news
release describing the proposed settlement. The FTC Act and other laws
the Commission administers permit the collection of public comments to
consider and use in this proceeding, as appropriate. The Commission
will consider all responsive public comments it receives on or before
September 4, 2026. For information on the Commission's privacy policy,
including routine uses permitted by the Privacy Act, see <a href="https://www.ftc.gov/site-information/privacy-policy">https://www.ftc.gov/site-information/privacy-policy</a>.
Analysis of Agreement Containing Consent Order To Aid Public Comment
I. Introduction
The Federal Trade Commission (``Commission'') has accepted, subject
to final approval, an Agreement Containing Consent Order (``Consent
Agreement'') from Caremark Rx, L.L.C. and Zinc Health Services, LLC
(collectively, ``Caremark'' or ``Caremark Respondents''). If and when
the Commission issues the Decision and Order as final, the Consent
Agreement settles (1) charges in In the Matter of Caremark Rx, Zinc
Health Services, et al. (``Insulin Litigation'') that Caremark violated
section 5 of the Federal Trade Commission Act, 15 U.S.C. 45, by
anticompetitively and unfairly creating a system of competition that
artificially prioritizes inflated rebates, and (2) the separate
Commission investigation (``PBM Investigation'') into Caremark's
business practices seeking to determine whether Caremark unlawfully
harmed pharmacy or PBM competition.\1\
---------------------------------------------------------------------------
\1\ Under the Consent Agreement, the Commission and Caremark
agree that the Consent Agreement is a global settlement that
resolves the current concerns of the Commission, to the extent
reflected in the Decision and Order, about Caremark's business
practices. The release in the order excludes certain types of claims
from its scope. For example, the release does not bar the Commission
from bringing claims regarding business practices that Caremark
adopts after the Consent Agreement was signed or that were unknown
to the Commission at the time, and it does not bar the Commission
from bringing claims in the event it becomes aware of any agreement
between Caremark and its competitors.
---------------------------------------------------------------------------
Caremark is one of the nation's largest pharmacy benefit managers
(``PBM''). Positioned at the center of the intricate and opaque
pharmaceutical distribution chain, it wields significant influence over
which drugs patients can access and at what price. Caremark administers
PBM services on behalf of its plan sponsor clients, including employers
that provide commercial insurance to their members. It creates drug
formularies (lists of preferred drugs) as well as preferred pharmacy
networks where members can go to fill their prescriptions. The Insulin
Litigation alleges that Caremark Respondents created a competition
system that prioritizes the size of rebates over drugs'
[[Page 50537]]
net price in winning clients, pushed insulin manufacturers to compete
for preferred formulary coverage based on the size of rebates rather
than net price, and shifted the cost of artificially inflated list
prices to vulnerable patients. The PBM Investigation seeks to determine
whether Caremark violated section 5 by requiring its clients' members
to use its affiliated pharmacies or coercing unaffiliated pharmacies to
accept unfavorable contractual terms.
The purpose of the Consent Agreement is to protect the public from
Caremark's anticompetitive conduct and deter others from engaging in
similar anticompetitive conduct. Under the terms of the Proposed
Decision and Order (``Proposed Order''), Caremark will: (1) cease to
discriminate against low-WAC \2\ versions of a drug on its standard
formularies; (2) provide a standard offering to its plan sponsors that
ensures that members will get the benefits of their share of rebates at
the point of sale; (3) in the event of certain legislative and
regulatory changes, provide a standard offering to its plan sponsors
that counts patient payments on TrumpRx toward patient deductibles and
out-of-pocket maximums, for covered drugs and drugs with most favored
nation pricing; (4) create a Copay Certainty Program that caps members'
out-of-pocket costs on insulin, and provide full access to the Copay
Certainty Program's insulin benefits to all members when a plan sponsor
adopts a formulary that includes an insulin product covered by the
program, unless the plan sponsor opts out in writing; (5) provide a
standard offering to all plan sponsors that allows the plan sponsor to
transition off rebate guarantees and spread pricing; (6) delink, for
its standard offering, drug manufacturers' compensation to Caremark
from list prices; (7) increase transparency for plan sponsors; (8)
include certain terms in its standard offering to retail community
pharmacies; (9) allow pharmacies in its networks to work with pharmacy
hub service providers; (10) promote the standard offerings to plan
sponsors and retail community pharmacies; and (11) maintain its group
purchasing organization (``GPO'') Zinc's activities in the United
States.
---------------------------------------------------------------------------
\2\ WAC, or wholesale acquisition cost, is the list price for a
drug set by pharmaceutical manufacturers for wholesalers and direct
purchasers.
---------------------------------------------------------------------------
The Consent Agreement has been placed on the public record for 30
days for receipt of comments from interested persons. Comments received
during this period will become part of the public record. After 30
days, the Commission will review the comments received and decide
whether it should withdraw, modify, or finalize the Proposed Order. The
purpose of this analysis is to facilitate public comment on the Consent
Agreement and Proposed Order to aid the Commission in determining
whether it should make the Proposed Order final. This analysis is not
an official interpretation of the Proposed Order or the Agreement
Containing Consent Order and does not modify its terms.
II. Insulin Litigation
In September 2024, the FTC sued the three largest PBMs--Express
Scripts, Caremark, and Optum--and their affiliated GPOs. The Complaint
alleges that Caremark Respondents have engaged in anticompetitive and
unfair rebating practices that artificially inflated the list price of
insulin drugs, impaired patients' access to lower list price products,
and shifted the cost of high insulin list prices to vulnerable
patients.
The Complaint alleges that Caremark created a system of competition
that prioritizes rebates over patient affordability. Caremark has
placed high-list price, high-rebate versions of insulin on its standard
commercial formularies and excluded low-list price, low-rebate versions
of the same drugs, even when the two versions had comparable net
prices. This system benefits Caremark, which keeps a portion of the
inflated rebates and uses the rest to attract plan sponsor clients,
while withholding drug-level price information from clients that would
have allowed them to make more informed decisions about patients' share
of drug cost. According to the Complaint, the inflated list prices hurt
patients whose out-of-pocket payments are tied to the list price of the
drug, such as patients in their deductible phase and those with
coinsurance. While patients pay inflated prices, Caremark is enriched
by the rebates tied to each filled prescription.
The Complaint alleges unfair methods of competition and unfair acts
or practices under section 5 of the FTC Act.
III. PBM Investigation
In fall 2023, the FTC opened an investigation to determine whether
certain business practices of the three largest PBMs, including
Caremark, violate the laws enforced by the FTC by unlawfully harming
competition for pharmacy services. Prior to and since opening the
investigation, Staff has received comments from pharmacies, patients,
and other market participants about Caremark's business practices. The
comments contend, among other allegations, that Caremark uses its
dominance to impose oppressive terms on unaffiliated pharmacies who
need to join the PBMs' pharmacy networks, including reimbursement rates
that make it uneconomical for unaffiliated pharmacies to dispense
medications. In December 2023, the FTC issued a civil investigative
demand to Caremark's parent company, CVS Health Corporation (``CVS
Health''), to investigate these concerns. That investigation has been
ongoing.
IV. Proposed Order
The Proposed Order, which lasts ten years from the Implementation
Date, contains the following provisions:
Section I generally requires Caremark to place low-WAC versions of
high-WAC drugs on its four standard commercial formularies at no
disadvantage to the high-WAC version. The provision includes exceptions
to this requirement if (1) the low-WAC version is higher net cost than
the high-WAC version, or (2) the drug is listed as ``Currently in
Shortage'' in the U.S. Food & Drug Administration's Drug Shortage
Database at the time the formulary takes effect or within the 18 months
prior to the formulary decision.
This provision addresses allegations that Caremark placed high-WAC
versions of drugs on its standard commercial formularies and excluded
low-WAC versions of the same drug, despite both versions having
comparable net prices. According to the Insulin Complaint, this
practice increased out-of-pocket costs to patients whose payments are
based on list price (e.g., because the patient is in the deductible
stage of their insurance or owes coinsurance calculated as a percentage
of list price).
Section II contains several terms designed to protect patients from
excessive out-of-pocket expenses. Specifically, Section II requires
Caremark to develop a ``standard offering'' to all plan sponsors that:
<bullet> Ensures member out-of-pocket costs are no higher than the
plan sponsor's contracted rate minus any rebates;
<bullet> Prohibits member out-of-pocket costs from being tied to
list price or any other benchmark higher than the plan sponsor's
contracted rate minus any rebates; and
<bullet> Provides full access to Caremark's programs that reduce
out-of-pocket costs for members.
These provisions, collectively, would reduce out-of-pocket costs
for members of those plans that adopt the standard offering, including
by ensuring
[[Page 50538]]
consumers generally benefit from the proportional amount of any rebate
in coinsurance and deductible policies. In addition to providing the
above options in its standard offering to all plan sponsors, Section II
also requires all fully insured health plans offered by Aetna (owned by
CVS Health) to adopt the above protections on patient out-of-pocket
expenses.
Under the ``meeting competition'' provision in Section XII,
Caremark would retain the flexibility to respond to specific client
requests by offering customized services that do not comply with the
``standard offering.'' The plan sponsors may ultimately adopt a
customized plan after being served with a notice of the standard
offering and acknowledging receipt in writing. This ``meeting
competition'' exemption does not apply to the requirements that Aetna
fully insured health plans adopt the patient protections in Section II.
Section III ensures that Caremark's standard offering, in the event
of certain legislative or regulatory changes, will attribute patient
payments made through the TrumpRx platform towards patient deductibles
and out-of-pocket cost maximum amounts, so long as the drug product is
covered under the plan sponsor's benefit design or certified as the
most favored nation price. The terms of Section III are subject to the
``meeting competition'' exemption detailed in Section XII of the
Proposed Order.
Section IV requires Caremark to create a Copay Certainty Program
that caps members' out-of-pocket costs on insulin to $25 for a
prescription claim with a 0-34 days' supply, $50 for a prescription
claim with a 35-68 days' supply, and $75 for a prescription claim with
a 69 or longer days' supply. Section IV requires that Caremark provide
full access to this program to all members when a plan sponsor adopts a
formulary that includes an insulin product covered by the program,
unless the plan sponsor opts out in writing. This provision offers
further protections to insulin patients against high out-of-pocket
costs. The terms of Section IV are subject to the ``meeting
competition'' exemption detailed in Section XII of the Proposed Order.
Section V addresses allegations that Caremark's use of rebates to
compete for plan sponsor business--particularly where those rebates are
not passed through to patients at the point of sale--can result in
excessive patient out-of-pocket expenses. Specifically, Section V
requires Caremark's ``standard offering'' to plan sponsors to:
<bullet> Enable members to receive the benefit of any rebate or
discounts at the point of sale, without charging a fee other than its
actual cost to pre-fund any rebate, if applicable;
<bullet> Not provide to plan sponsors rebate guarantees or other
guarantees of pre-determined amounts of compensation; and
<bullet> Not employ spread pricing (the practice of a PBM charging
a plan sponsor a different amount for the purchase of a drug than the
PBM reimburses the pharmacy).
The terms of Section V are subject to the ``meeting competition''
exemption detailed in Section XII of the Proposed Order.
Section VI addresses allegations that Caremark benefits from
placing higher list price products on its formularies by charging fees
to manufacturers that are based on list price. Specifically, Section VI
provides that compensation received by Caremark from drug manufacturers
related to Caremark's ``standard offering'' to plan sponsors will not
be based, directly or indirectly, on a drug's list price.
Section VII addresses allegations that Caremark obscures net price
information from plan sponsors. Specifically, Section VII increases
transparency for plan sponsors by requiring Caremark to provide as part
of its standard offering an annual report disclosing each drug's costs
and pharmacy claim-level reporting, as well as any compensation paid to
consultants or brokers in connection with Caremark's provision of
pharmacy benefit services.
Section VIII addresses Caremark's pharmacy reimbursement practices.
Section VIII requires Caremark to develop a standard offering to retail
community pharmacies (defined as a retail pharmacy business with three
or fewer store locations) that will:
<bullet> Compensate retail community pharmacies based on the actual
cost of acquiring prescription drugs plus a dispensing fee;
<bullet> Make additional payments for all non-dispensing services
performed by a retail community pharmacy; and
<bullet> Not exclude any retail community pharmacy willing to agree
to the terms and conditions for participation from its standard
offering to retail community pharmacies.
The terms of Section VIII are subject to the ``meeting
competition'' exemption detailed in Section XII of the Proposed Order.
Section IX addresses Caremark's practices relating to third party
digital pharmacy service providers known as hubs. Section IX prohibits
Caremark from imposing or enforcing, or threatening to impose or
enforce, any rule, agreement, or policy that prohibits or restricts a
pharmacy's engagement with a hub, so long as the pharmacy complies with
law, regulation, and certain rules for transparency. Caremark also may
not take any other action to interfere with the ability of a pharmacy
to engage with a hub.
The provision includes exceptions for certain circumstances.
Caremark may take action with documented evidence that: the pharmacy is
on a Federal or State exclusion list, has been flagged by regulators,
or is suspected of fraud, waste, or abuse; the action is required by
law; or the action is taken pursuant to a client agreement or at a
client's written request, provided Caremark does not require, coerce,
or create a default option for such agreements or requests, nor
materially misrepresent hubs to clients. Caremark must report all such
actions to the Monitor quarterly, retain supporting documents, and post
a notice of Section IX on its pharmacy portal.
In addition, Section IX provides that Caremark must apply its audit
selection criteria equally to all pharmacies of the same type,
including CVS affiliates.
Section X provides that Caremark will advertise its standard
offerings; clearly and conspicuously disclose their existence and
availability in material created to advertise, market, or otherwise
promote its products to plan sponsors and retail community pharmacies;
not disparage its standard offerings; and not require or coerce plan
sponsors or retail community pharmacies to adopt terms that differ from
its standard offerings.
Section XI provides that Caremark will maintain the operations of
its GPO, Zinc, in the United States.
Section XII provides that nothing in Sections II, III, IV, V, and
VIII shall prevent Caremark from responding to a written request for
terms other than the standard offering from a plan sponsor or retail
community pharmacy. If Caremark receives a written request from a plan
sponsor for terms that differ from the standard offering, Caremark must
include in its response the standard offering and a written
acknowledgement (Exhibit A to the Decision and Order) that the plan
sponsor has received, read, and understood the explanation of benefits
of the standard offering. If Caremark and the plan sponsor ultimately
agree on terms that differ from the standard offering, the plan sponsor
must sign and return the acknowledgment. Aetna's fully-insured health
plans are excluded from Section XII's ``meeting competition''
exception.
Section XIII appoints a monitor for a term beginning shortly after
the Order issues and ending three years after the
[[Page 50539]]
Implementation Date (defined as no later than January 1, 2027). The
monitor has the authority to monitor Caremark's compliance with the
obligations set forth in the Proposed Order, to act in consultation
with, and make inquiries on behalf of, the Commission or its Staff, and
to make annual reports to the Commission.
Sections XIV, XV, and XVI contain provisions designed to ensure the
effectiveness of the relief, including: obtaining information from
Caremark that it is complying with the Order; requiring Caremark to
submit compliance reports; and requiring Caremark to notify the
Commission of certain changes in its corporate structure.
Section XVII provides that Caremark will cooperate with the ongoing
Insulin Litigation, including by providing a certain number of
witnesses for depositions and for trial.
By direction of the Commission.
April J. Tabor,
Secretary.
[FR Doc. 2026-15913 Filed 8-4-26; 8:45 am]
BILLING CODE 6750-01-P
</pre></body>
</html>Indexed from Federal Register on August 5, 2026.
This is legal information, not legal advice. Laws vary by jurisdiction and change frequently. Always verify current law with official sources and consult a licensed attorney in your jurisdiction for advice on your specific situation.