Pfizer sues Texas agency for leaking 'confidential' Medicaid pricing deals

Pfizer
Pfizer has sued the Texas Health and Human Services Commission over its release of private drug-pricing information.

Pfizer has faced scrutiny for its drug pricing over the last year, but now it’s bringing some heat of its own to protect those numbers from prying eyes. The pharma giant last week sued a Texas agency, claiming officials there illegally leaked its private drug-pricing info.

After public information requests, the Texas Health and Human Services Commission sent private pricing and rebate info to the chair of the Texas Senate Health and Human Services Committee and the chair of the Texas Senate Finance Committee, Pfizer said in a new lawsuit. That's a violation of state law, the company contends.

An HHSC spokesperson said the agency is "aware of the suit and will respond at the appropriate time."

Pfizer itself keeps a tight lid on pricing information, even shielding the details from most of its own employees, according to the lawsuit. If discounts are made public—particularly larger discounts often given to state agencies—other payers might demand the same deal.

It's a serious matter for the drug giant because it operates in a “fiercely competitive” industry where “small differences in pricing and rebates can make the difference between success and failure,” Pfizer says. One way companies get ahead in the industry is to look for “efficiencies and cost savings.”

If the pricing info were leaked to competitors, the New York-based pharma could be at a disadvantage “in a highly competitive marketplace and in competitive bidding situations,” the suit states.

Further, private pricing details help keep costs low for agencies such as Texas Medicaid, Pfizer says. That’s in part because, if the info were public, “the purpose of competitive bidding would be defeated."

Pfizer seeks a declaratory judgment and injunctive relief in the action. The company wasn’t notified when the pricing information was released, it says. HHSC’s actions “created a situation that is capable of repetition, but evading review.”

The agency will continue the practice unless told otherwise by a court, according to the company.

For its part, Pfizer has had a role in the larger, ongoing drug pricing conversation that's had a hold on the industry for more than a year now. Following big price hikes by Valeant Pharmaceuticals and Turing Pharmaceuticals, which initially stoked the flames, Pfizer raised the prices on more than 100 drugs on January 1. Separately, a Senate committee in June took the company and others to task over the rising costs of naloxone, which is used to reverse the effects of opioids.