A federal judge in Portland has denied efforts by an Oregon-based company to dismiss a lawsuit alleging it was part of a conspiracy by front groups trying to keep information about drug options on cheap prescription out of public view.
U.S. District Judge Michael H. Simon ruled Monday that the case against LegitScript can proceed, denying the Portland-based company’s motion to dismiss the lawsuit filed against it by PharmacyChecker.com.
It’s the latest twist in a case that dates back to 2019, when New York-based PharmacyChecker.com sued the National Association of Pharmacy Boards, LegitScript and three other groups, alleging they were waging a “campaign coordinated misinformation campaign to unfairly stifle competition and artificially inflate prescription drug costs while providing misinformation to discourage people from using international online pharmacies that offer lower cost drugs.
These allegations include a “blacklist” and a coordinated effort to convince Internet search engines to give PharmacyChecker.com a low ranking in search results that consumers rely on for information.
LegitScript, in its motion, unsuccessfully argued that PharmacyChecker.com failed to present sufficient facts linking it to the alleged conspiracy.
In his ruling, the judge cited another Ninth Circuit court ruling in favor of a company that sold clear teeth aligners through a direct-to-consumer online platform. The online platform sued dentists who provided competing care and were members of the California dental board. The ruling noted “that it is easy to recall examples of consumer-driven business models in the medical field that were once resisted” but ultimately – through litigation, laws and regulations – leads to cheaper and more accessible services.
In the Oregon ruling, the judge said the California case had “significant similarities” to the PharmacyChecker.com case because the company “alleged that the cost of prescription drugs in the United States is more higher than anywhere in the world, and the effect on public health is disastrous.Each year, millions of Americans do not fill their prescriptions because of the cost, and many become sicker or even die as a result.
The federal government strictly regulates the importation of wholesale prescription drugs. However, US residents can generally order from foreign pharmacies up to three months’ supply of prescription drugs for personal use, even though this is technically illegal.
The case was originally filed in New York, but the part of the lawsuit involving LegitScript was eventually moved to Oregon, where the court has jurisdiction. But the outcome of the case will go beyond state borders. The underlying business is centered on the world of online marketing and international pharmaceutical sales. The civil lawsuit involves international pharmacies and their access via the Internet to people struggling to find safe, low-cost pharmaceuticals.
PharmacyChecker.com operates an accreditation service for international pharmacies and provides price comparisons so users can purchase prescriptions online, including from Canadian pharmacies. For example, the company said, the diabetes drug Januvia costs nearly $500 for a month’s supply in the United States, but only $114 at a Canadian pharmacy and even less at licensed pharmacies in other countries.
“Defendants want to prevent consumers from accessing information about prescription drug costs and prescription drug savings,” Aaron Gott, senior counsel for PharmacyChecker.com, said in an interview. “PharmacyChecker is one of their targets due to the fact that it provides comparative information on prescription drug prices in the United States and abroad.”
Evan Smith, vice president and general counsel of LegitScript, said the company does not comment on ongoing litigation.
PharmacyChecker.com says LegitScript is a contender. LegitScript provides third-party certification for healthcare companies, including pharmacies, telemedicine providers, and addiction treatment providers. LegitScript, in its online profile, claims to have “earned the trust” of regulators, credit card companies, search engines and e-commerce platforms including Visa, Google, Bing, Facebook and Amazon.
LegitScript was founded in 2007 by John Horton, a former Multnomah County prosecutor who worked for the White House Office of National Drug Control Policy, according to a 2012 LegitScript profile published in The Oregonian. LegitScript monitors online drug-selling entities, including those that operate outside US borders, and provides the information to entities, including investigators from the Food and Drug Administration, Microsoft, and Google.
The defendants in the lawsuit filed responses that deny a conspiracy to censor PharmacyChecker.com or rank its results lower in search engines.
The lawsuit’s alleged plot centers on a “blacklist” of “not recommended sites” that internet search providers Google and Bing use in a way to reduce traffic to PharmacyChecker as well as the company’s certified international online pharmacies.
In its complaint, PharmacyChecker.com claims its revenue is directly tied to performance and visibility in search engine results, which fell in 2019 due to the alleged blacklisting. For example, in February 2019, PharmacyChecker.com pages ranked in the top three positions in Google searches for phrases related to online pharmacies, according to the lawsuit.
With Google’s updates, most of PharmacyChecker.com’s top rankings are gone, according to the lawsuit. For example, it jumped from the top result for the search phrase “online pharmacies” to number 90, which the lawsuit says is “effectively out of sight of consumers.”
The blacklist, created by the National Association of Boards of Pharmacies, or NABP, through a Pfizer grant, lists dangerous pharmacy operators but also dozens of safe sites, PharmacyChecker.com claims in its lawsuit.
NABP targets “rogue online pharmacies” and platforms that provide patients with international pharmacy options, some of which are unregulated and illegal and may endanger patient health, according to a company statement released. in January. The board said accountability was crucial given the rapid increase in counterfeit drugs entering the United States.
NABP and the Center for Safe Internet Pharmacies, which are both defendants in the lawsuit, worked together to convince Internet search engines to penalize these sites in search results, according to the lawsuit, calling the defendants a “network of ‘overlapping non-profit organizations and private businesses’. which are funded or supported by pharmaceutical manufacturers and large pharmaceutical interests.
Additionally, in 2018, the NABP blacklisted PharmacyChecker.com, according to the lawsuit, even though the website is not a pharmacy and only provides information.
The action means PharmacyChecker.com’s directory of accredited online pharmacies no longer appears as a link at the top of Google search results, according to the lawsuit. Thanks to the Bing search engine, a warning box now warns users, denies access to the link, and instead directs people to information from NABP, the Center for Safe Internet Pharmacies, and LegitScript, all designated entities as co-conspirators in the trial.
The lawsuit seeks a jury trial to end the blacklist and award unspecified damages for the company’s lost revenue.
You can reach Ben Botkin at [email protected] or through Twitter @BenBotkin1.