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No matter where your pharmacy is located, how busy it is, or how long it has been in business, it will face audits and reviews by PBMs and third-party payors.  Investigations, audits, and other actions by PBMs are on the rise and have dramatically increased in number and scope.  Adverse audit outcomes often include termination of provider agreements, which, in most cases, can lead to the pharmacy's demise.

Most on-site and desktop audits can be resolved with better outcomes if experienced counsel is engaged early in the process.  Ideally, audit preparation should begin way before an audit notice is received, through the process of ongoing collaboration between counsel and the pharmacy.  The preparation process should include compliance and best practices review, developing and implementing effective policies and procedures, as well as record-keeping and risk assessment.  

Unfair and abusive practices by PBMs, their third-party contractors, and health plans can be neutralized through various situation-appropriate and assertive approaches. Counsel who is well-versed in the process, if engaged at the early stages of an audit, can assist in many different ways.  Strong and appropriate responses to commonly encountered audit scenarios will help the pharmacy to avoid pitfalls and successfuly complete an audit.  When unfavorable findings are inevitable, experienced counsel can help to avoid large recoupments, termination, and possibly referrals to law enforcement and administrative agencies.

Through years of defending audits and other actions by CVS Caremark, OptumRx/Catamaran, Argus, Express Scripts, Humana, Horizon, Envision Rx, Prime Therapeutics, ProcareRx, Medimpact, Navitus, and others, our attorneys have developed numerous succesful approaches to the full range of issues that arise in PBM audits:

Audits frequently focus on matching the purchase history of a pharmacy with the number of claims submitted.  These types of audits present mutliple, particularly complicated challenges to unrepresented clients. Your chances of successfully completing an invoice shortage audit are much higher with proper coordination among counsel, pharmacy, PBM personnel, wholesalers, and PSAOs.  We represent pharmacies in connection with all types of invoice shortage audits.  In cases of unfavorable audits, we can raise multiple post-audit challenges and employ strategies we have developed through representing hundreds of pharmacies to minimize the impact.
Compounding pharmacies are especially susceptible to frequent audits.  They often focus on the propriety of using certain ingredients or formulations in compounds, and on whether the pharmacy correctly billed for the compounds.  Invoice shortage audits also often accompany compounding audits.  An experienced PBM audit attorney not only familiar with the legal aspect of a PBM audit, but also with practical and business aspects of the compounding practice, can help the pharmacy to properly navigate many critical issues that can end up costing the pharmacy hundreds of thousands of dollars in disallowed claims.
We often encounter situations when our clients face audits due to license-related issues, such as acting outside the scope of their license, shipping to states in which they are not licensed as out-of-state providers, and the like.  We have developed a deep understanding of license-related laws and regulations and can help you to avoid and mitigate licensure-related audits, investigations, and possible referrals to authorities.

PBMs often claim that certain prescriptions were written in violation of laws and regulations, and filled without requesting corrections from prescribers.  This is when our knowledge of the laws and regulations can, and frequently does, make all the difference.
One of the more common types of audits, they can be effectively dealt with by using our tried and proven strategies and deep knowledge and understanding of the industry.
Sometimes audits implicate issues of PBM credentialling, such as whether correct pharmacy background information was submitted to the PBM; dealing with excluded individuals, initial credentialling due to audits of other entities, and obtaining PBM contracts when the pharmacy was purchased from a previously terminated owner.  No matter the challenges, we have effective ways of dealing with them and navigating you through some of the roughest waters when it really matters.
We have successfully dealt with numerous mail-order-related audits implicating issues ranging from confirmation of receipts of medications to engaging in mail-order activities when prohibited by PBM contracts.
Most patient- and physican-denial audits have nothing to do with fraud, waste or abuse.  We know how to present these issues to the PBMs and deal with them in an efficient and expeditious manner.
* Our attorneys are licensed to practice law in New York and New Jersey. In litigation, arbitration and other matters, as the case may be in the states, in which we are not licensed to practice, local counsel may be engaged.


  • Aggressive defense of pharmacies in PBM audits and investigations, including arbitration and litigation
  • Representation in cases of termination of provider agreements
  • Pre-audit counseling and audit preparation
  • Post-audit mitigation, dealing with recoupment issues
  • Credentialling, re-credentialling, and reinstatements