(Adds Left comment, byline, updates share prices)
By Deena Beasley
Dec 8 Short seller Citron Research's Andrew Left
has turned his sights on Express Scripts Holding Co,
calling the pharmacy benefit manager (PBM) the "culprit behind
pharmaceutical price gouging."
Shares of Express Scripts, the largest PBM in the United
States, fell 6.7 percent to close at $70.75 on Nasdaq. Citron,
which profits from bets that stock prices will fall, set a price
target of $45 on the company's shares. (bit.ly/2gGrUhy)
Express Scripts "is Philidor of the pharma industry.
@therealdonaldtrump promises to fix drug pricing? Two words:
EXPRESS SCRIPTS," Citron tweeted on Thursday. (bit.ly/2goUtlT)
President-elect Donald Trump, in a Time magazine article on
Wednesday, said he would "bring down drug prices."
"We make money when our clients save money," Express Scripts
said in comments emailed on Thursday. "The vast majority of
rebates we negotiate go directly back to our clients."
PBMs like Express Scripts manage prescription drug plans
for employers and insurers. Philidor Rx Services, now closed,
was a mail order pharmacy linked to efforts by Valeant
Pharmaceuticals International Inc to steer
prescriptions to its high-priced drugs.
Left, during an interview on CNBC, said Express Scripts
benefits from the "opaqueness" of drug pricing, but "by no means
am I saying that this company is a fraud."
PBMs have in recent years taken an increasingly aggressive
stance in price negotiations with pharmaceutical companies, in
some cases limiting access to rival drugs in specific categories
in return for discounts to list prices or rebates.
Shares of Express Scripts have struggled for most of this
year after a major customer, health insurer Anthem Inc,
sued the company over drug rebates.
Citron sparked the investigation into the relationship
between Valeant and now-shuttered Philidor with a report issued
in October 2015.
A former Valeant executive and the former CEO of Philidor
were arrested last month on charges that they engaged in a
multimillion-dollar fraud and kickback scheme.
Shares of drugstore operator CVS Health Corp, which
has a PBM unit, fell 3 percent to close at $78.11 on the New
York Stock Exchange.
(Additional reporting by Natalie Grover in Bengaluru; Editing
by Lisa Shumaker and Andrew Hay)