FTC Reaches Second Insulin Pricing Settlement: Comparing the Caremark and ESI Orders

On July 14, 2026, the Federal Trade Commission (FTC) announced its settlement with Caremark Rx, LLC and Zinc Health Services, LLC (Caremark) to resolve claims from the FTC’s 2024 Complaint alleging Caremark, OptumRx, Inc. (OptumRx), and Express Scripts, Inc (ESI) used anticompetitive rebate schemes to artificially inflate insulin prices.  

Background 

The 2024 Complaint alleged that the above-named pharmacy benefit managers (PBMs) engaged in unfair methods of competition and unfair acts or practices in violation of the FTC Act.  Specifically, the Complaint alleged that the PBMs used rebate-driven formulary practices that encouraged manufacturers to compete for formulary placement based on rebate size rather than the net cost of insulin.  According to the FTC, this structure resulted in higher insulin list prices and increased out-of-pocket costs for patients.

The resulting Decision and Order (Caremark Order) represents the second settlement in the FTC’s ongoing litigation against the nation’s three largest PBMs, following the Commission’s earlier settlement with ESI (ESI Order). 

Caremark Order Closely Tracks ESI Order

The Caremark Order is largely consistent with the ESI Order and requires Caremark to, among other things:

• Stop preferring high-WAC drugs over low-WAC alternatives on its standard formulary, specifically when the low-WAC versions are economically preferable and available. 
• Ensure that, both through its affiliated health plan, Aetna, and as part of its standard offering to non-affiliate plan sponsors, patients’ out-of-pocket costs are not based on a drug’s list price but instead reflect the contracted amount between Caremark and an applicable plan sponsor, less any applicable rebates.
• Provide plans and beneficiaries with access to TrumpRx as part of its standard offering.
• Expand affordability protections for insulin products, including specified caps on patients’ insulin out-of-pocket costs, unless a plan sponsor opts out.
• Provide a standard offering allowing plans to transition away from traditional rebate guarantees and spread pricing, while also enabling point-of-sale rebates to be passed through to patients at the pharmacy counter.
• Delink manufacturer compensation paid to Caremark from drug list prices and prohibit compensation structures tied directly or indirectly to WAC-based benchmarks as part of its standard offering.
• Increase transparency for plan sponsors through enhanced drug-level cost reporting, pharmacy claims reporting, disclosure of consultant and broker compensation, and information needed for compliance with transparency requirements. 
• Establish new protections for independent and community pharmacies, including reimbursement methodologies tied to acquisition cost and dispensing fees. 
• Promote its standard offerings to plan sponsors and retail pharmacies through specified disclosure and marketing obligations, while limiting its ability to steer customers away from those offerings.
• Agree to increased oversight, access, and enforcement obligations to the FTC, including requiring compliance with a multiyear monitoring requirement, submission of compliance reports as required by the FTC, cooperation with litigation in connection with the 2024 Complaint, and grant FTC access to facilities, personnel, and records as FTC deems necessary. 

The Caremark Order, similar to the ESI order, also requires Caremark to make certain standard offerings available, and to market and disclose those offerings in the manner prescribed by the Caremark Order.  However, the Caremark Order does not require every client contract to adopt the standard offerings.  Plan sponsors may still elect alternative, non-standard arrangements that do not incorporate any or all aspects of the standard offering requirements, provided that Caremark complies with the Caremark Order’s disclosure, marketing, and anti-steering obligations before entering into such alternative arrangements.  

Key Differences Between the Caremark Order and the ESI Order

Although the Caremark Order tracks closely with the ESI Order, several provisions differ in scope and operation. 

• Carve Out for Medicare, Medicaid, and Exchange Plans.  Unlike the ESI Order, the Caremark Order contains several express exclusions for Medicare (including Medicare Employer Group Waiver Plans), Medicaid, and Exchange plans.  Specifically, the Caremark Order’s definitions of “Plan Sponsor,” “Member,” and “Fully Insured Health Plan” are limited to commercial pharmacy benefit arrangements and exclude government-sponsored programs and Exchange plans.  These exclusions appear to confine the Caremark Order’s key requirements to Caremark’s commercial PBM business, and will not apply to benefits administered under Medicare, Medicaid, or Exchange plans.
• Caremark Order Includes Protections for Hub Pharmacy Arrangements.  In contrast to the ESI Order, which contains no comparable provision, the Caremark Order limits Caremark’s ability to restrict relationships between hub pharmacies and pharmacy hub service providers.  Pharmacy hub service providers generally receive and coordinate patient prescriptions, administer copay assistance and other patient support services, and direct hub pharmacies to dispense medications; hub pharmacies then typically receive reimbursement from the pharmacy hub service provider. The Caremark Order protects these arrangements when the entities are providing services and recouping reimbursements in connection with plan services.
• Low-WAC Formulary Obligations Subject to Different Shortage Conditions.  Unlike the ESI Order, which conditions formulary placement on the manufacturer’s ability to supply sufficient product to meet member needs, the Caremark Order Low-WAC version requirements only apply if the drug is not listed by the Food & Drug Administration as “Currently in Shortage.”  As a result, the Caremark Order offers a safeguard for the PBM to decline to place an otherwise eligible Low-WAC product on its Standard Formularies when there is an FDA shortage notice. 
• Member Cost-Sharing Obligations: Net Unit Cost vs. Client Contracted Amount.  While the orders are similar in that they establish patient cost-sharing requirements specific to the PBM’s affiliated insurers, the orders outline different methodologies to calculate the amount on which patient cost-sharing must be based.  Under the ESI Order, ESI must tailor its standard offering to non-affiliated plans as well as contract with Cigna Healthcare in such a manner that ensures patient cost-sharing under such plans does not exceed a drug’s Net Unit Cost.  By contrast, the Caremark Order requires Caremark to contract with Aetna's fully insured health plans and offer as part of its standard offering to non-affiliated plans an arrangement that ensures patient cost-sharing calculations are based on the contracted amount between Caremark and an applicable plan sponsor, the “Client Contracted Amount,” less any applicable rebates.
• Additional Conditions and Exceptions for TrumpRx Pricing.  Similar to the ESI Order, the Caremark Order requires Caremark’s standard offering to provide patients with the benefit of TrumpRx direct-to-consumer pricing.  However, unlike the ESI Order, the Caremark Order conditions this requirement on drugs purchased by patients through the platform and requires coverage only for drugs covered under the applicable plan or those that are “certified by TrumpRx” as being the most-favored nation (MFN) price. Additionally, the Caremark Order allows a carve out for the plan sponsor to not cover the TrumpRx purchase if “doing so would be inconsistent with that plan sponsor’s or the controlling owner(s) of that plan sponsor’s sincerely held religious beliefs or moral convictions.”
• Caremark Order Establishes Fixed Insulin Copay Cap Dollar Amounts.  Unlike the ESI Order, which establishes a general insulin out-of-pocket cost cap that must be lower than the price under the applicable pharmacy benefit plan, the Caremark Order imposes specific copay dollar amount caps based on the days’ supply of insulin provided.
• TrueCost Program Pricing Model Carve Out.  The Caremark Order expressly permits Caremark to continue offering its TrueCost program and certain per-member-per-month net cost guarantees, provided those arrangements otherwise comply with the Order.
• Caremark Order Imposes Additional Protections for Pharmacy Acquisition-Cost Information.  Unlike the ESI Order, the Caremark Order restricts how Caremark may use pharmacy acquisition-cost data and requires safeguards to protect the confidentiality of that information.

With two of the FTC’s claims against the three respondent companies now resolved through settlement, attention turns to OptumRx, the lone remaining respondent. We will continue to monitor developments in the OptumRx litigation and provide updates through our Mintz Health Care Viewpoints.

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