• Employer health plans left open to similar suits, attorneys say
  • Lowering liability will entail employers stepping up oversight

A novel lawsuit from an employee suing Johnson & Johnson Inc. for allegedly mismanaging drug benefits appears a harbinger of litigation to come against companies, especially those that rely on pharmaceutical industry middlemen to negotiate pricing and rebates.

Ann Lewandowski, a health-care policy and advocacy director for Johnson & Johnson, filed the proposed class action Feb. 5 in US District Court for the District of New Jersey. The suit said the New Jersey-based company mismanages its employee health plan by paying its pharmacy benefit manager, Express Scripts Inc., inflated prices for generic specialty drugs that are widely available at much lower cost.

Employers are likely to face legal challenges by employees for paying more than is necessary after being warned for years that previously hidden information on negotiated prices for health care services has become publicly available to potential plaintiffs through new laws and regulations. These new lawsuits would be comparable in some ways to those filed against companies for paying excessive fees or mismanaging investments in 401(k) defined contribution retirement plans, according to attorneys who advise employers.