Case: 4:18-cv-01005 Doc.

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Exhibit D
 Case: 4:18-cv-01005 Doc. #: 1-4 Filed: 06/20/18 Page: 2 of 10 PageID #: 43

BOIES

BS SCHI LLER
FLEX NER

May 17, 2017

VIA E-MAIL & FED.EX DELIVERY

Provider Compliance
Express Scripts, Inc.
One Express Way
St. Louis, MO 63121
pharmacyproviderte1m@express-scripts.com

Re: Notice of Breach and Cease and Desist/CZ Services, Inc. dba CareZone
Pharmacy; NCPDP 5654137

To Provider Compliance:

This letter is in response to the cease and desist letter Express Scripts, Inc. ("ESI") sent to
CZ Services dated April 12, 2017. The ESI letter contains a number of incorrect and misleading
assumptions and conclusions. In that letter, ESI demanded four things:, namely that (1) CZ
Services stop mailing into non-resident states, (2) CZ Services produce copies of its licenses for a
set of enumerated states, (3) CZ Services refrain from conduct that is a breach of its agreement with
ESI and (4) CZ Services produce a corrective action plan. The following is CZ Services' response.

CZ Services Does Not Mail

CZ Services is a retail pharmacy specializing in compliance packaging that results in vastly

increased adherence to prescription regimens. Its goal is to maximize patient health and well-being
by assisting patients with the maintenance of their medication regimens, including making
medications available in an easy to use packing system.

CZ Services is located in Richmond, California. The pharmacy is licensed and in good

standing in all 50 states, as well as the District of Columbia. CZ Services does not mail any
prescriptions. All prescriptions filled by the pharmacy are dispensed in the Richmond pharmacy
and picked up by the patient or by an agent of the patient (consistent with CCR 1714.l(b)) which
assists the patient. ESI's conclusion that CZ Services participates in mailing prescriptions is
incorrect.

For the most part, the patients who use CZ Services are polychronic and managing
complicated health profiles. Many of them are dealing with serious health conditions that require a
significant and complex medication regimen. A large percentage of the pharmacy's patients are
polychronic veterans and Medicare recipients (approximately 40%).

Patients come to CZ Services through a variety of channels. Some are walk in patients,
some come via federal programs like Pace and some come through a health management service
they utilize to help them manage their complicated health needs. The patients who use the health
management service appoint that service as their agent to do many things on their behalf, including

BOI ES SCHILLER FLEXNER LLP

1401 New York Avenue NW, Washington. DC 20005 I (t ) 202 237 2727 I (f) 202 237 61311 www.bsfllp.com
 Case: 4:18-cv-01005 Doc. #: 1-4 Filed: 06/20/18 Page: 3 of 10 PageID #: 44

BSF Provider Compliance

Express Scripts, Inc.
May 17, 2017

arranging for the filling of their prescriptions. As the patients' agent, the health management
service may select a pharmacy, such as CZ Services, on the patient's behalf and pick up
medications on behalf of the patient when they are ready.

Every prescription that is filled by CZ Services is dispensed in the Richmond pharmacy and
signed for by the patient or by an agent of the patient. While the pharmacy does not mail into other
states, it does provide counseling to patients from other states. Because of this, the pharmacy
maintains non-resident licenses in all states.

Accordingly, ESI's conclusion that "nearly 99% of Provider's business is mail order" is
erroneous. To the contrary none of CZ Services' business is mail order. Further, contrary to the
allegations contained in the letter, CZ Services has made no misrepresentations to ESI - it said it did
not mail and it does not mail prescriptions.

CZ Services Is Licensed And In Good Standing In All 50 States

Next, ESI claims that the pharmacy is not licensed in 5 states - in violation of the ESI
agreement. That also is a false allegation. Attached as Exhibit A are copies of the licenses from
New York, Virginia, Tennessee, Georgia and Maryland.

It is surprising that ESI would take this position, as all requested licenses were physically
shown to an ESI auditor on March 29, 2016 as part of an onsite routine audit. The BOP websites
for those states also show that the pharmacy is licensed and in good standing. We will assume that
this was a mistake on ESI's part.

CZ Services Is In Compliance With All Of The Terms Of the ESI Agreement

CZ Services has complied with the terms of its agreement with ESI and plans to continue
said compliance.

A Corrective Plan is Moot

Given that CZ Services is not mailing prescriptions, has proper licensure in place and is
compliant with the terms of the ESI agreement, there is nothing to include in a corrective plan. CZ
Services has operated with the highest level of integrity and compliance.

It is troubling to CZ Services to receive a letter like this making incorrect assumptions and
accusations, especially given that ESI auditors have inspected CZ Services in person and raised no
concerns about the pharmacy's model. Given the increasing regulatory scrutiny of ESI, it is
puzzling to see ESI treat a partner in this manner.

Page 2 of3
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BSF Provider Compliance

Express Scripts, Inc.
May 17, 2017

This letter should sufficiently address the inaccurate conclusions raised in ESI's letter. I am
available to discuss if you have any questions.

Yours very truly,

(_J ~ <r-\A..
William A. Isaacson

Encl.

Page 3 of3
Case: 4:18-cv-01005 Doc. #: 1-4 Filed: 06/20/18 Page: 5 of 10 PageID #: 46

STATE OF GEORGIA
Departmeot of Community Health
Georgia State Board of Phannacy
Non·Resident Pharmacy
License No. PHNR0006&4 Stanis: Active

Carel.one Pharmacy
860 Harbour Way S Ste E
Richmond CA 94802

Expires: 6130/2017
Issued: 8/1412015

Rcal·tlmc llccn'-C verification i.~ available al gedch.myllctt!Se aunlvcrific~tlon

f ~~
~~~~~--:ST=-:-A:T~E~O~F~G~EO~=R~G~IA~~~--.
1 ~~ . Departmmt of Community Health
· t,(?; ~. G~'Urg. ia Slnh: Bua rd of Phum1ncy
•M - Non-Rc-sidcnt Phannacy
Uc.."llSI! No. PUNR()()()6R4 ·Active
C'areZone Pharmacy
860 Harbour Way S Sie £
Rklunond CA 94802

ls.<ucd: 8'1 41201 5

EJ.pircs 6i30/2017
R1.~l~dmo lh."l:'~ "<riril.'"uUun b a\ailab!t: at 1twll.-h.mvt1"1lli':A'Ulf\o\"Qifkulwn
Case: 4:18-cv-01005 Doc. #: 1-4 Filed: 06/20/18 Page: 6 of 10 PageID #: 47

PHARMACY REGISTRATION
STATE OF MARYLANO 47937
57826
DEPARTMENT OF HEAL TH AHO MENTAL HYGIENE

Maryland Board of Pharmacy

THE MARYLAND STATf BOARD OF PHARMACY CERTIFIES THAT
4201 Patterson Avenue CAR£ZONE PHARMACY CARE2QNE PHARMACY
IS A REGISTERED Active
Baltimore, Maryland 21215
Pharmacy - Pharmacy

CAREZONE PHARMACY
In "cordance with the Health Occu itlons Artlde of the Annotat•d Cod• of Marylond
3175 17th Street UC. REG. PERM. HO. EXPIRATION DATE
San Francisco CA 94110 P07102 05/31/2018
SIGNATURE OF DEARER

s7a~e7937
State Maryland
THE MARYLAND STATE BOARD OF PHARMACY
CERTIFIES THAT ~~PHARMACY ('AREZONE PHARMAcy
IS A REGISTERED Active
Pharmacy - Pharmacy - -

IN ACCORDANCE WITH THE HEALTH OCCUPATIONS ARTICLE OF THE ANNOT.ATED C~

··· OF M.ARYLAN.D
LIC. REG. PERM. NO. EXPIRATION DATE v_!-i
P07102 05/311201 8 ---cr;;;:~TA l Y O.H.~.H.
WHERE REQUIRED BY LAW THIS MUST BE CONSPICUOUSLY DISPLAYED IN OFFICE TO WHICH IT APPLIES

Pharmacy Change of I nformution

A Pharmacy must report changes in their names, addresses, place of employment or other contact
infonnation in order to receive renewal notices, newsletters and other important information. A copy
of a legal document, such as a Marriage Certificate, must accompany name changes.

To report changes, subm it the Pharmacy Change of Information form. The form may be downloaded
from the Board's website at http://clh mh.maryland .gov/pharmacy - click on Form & Publications, or
contact the Board to have the form sent to you.

Return the completed form by mail, fax or email to:

Maryland Board of Pharmacy

4201 Patterson Avenue
Baltimore, Maryland 21215
Toll Free: (800)-542-4964 Fax: (410) 358-6207
Email: dhmh.mdbop@maryland.gov
 Case: 4:18-cv-01005 Doc. #: 1-4 Filed: 06/20/18 Page: 7 of 10 PageID #: 48

REGISTRATIO'.\' I Ct:RTFIC\TIO:-

USE FORM DROW FOR NAME ANDIOR ADDRESS Cl !Al'GES D~:PAlffMEN T OF ll f,A LTll A:>iD MENTAL
DRUG CONTROL MUST 0E NOTIFIW OF THESE CHANGF.S IMMl:DUITEl.Y 11\'Glf..."i£
l)l\'lSI0:-1 OF ORllG COl\'TROl.
01\PAlrrM!.iNT OF HE.At.TH ANO MENTAi. HYGIEN!i
DIVISION OF DRUG COl'tfROl. THIS CERTIFIF.~ THAi TH F. /IPPLICA1''T umo Dr:tow IS Rf.G ISTEl!F.0 TO
~20 1PATTERSON AVE. fli\l.TIMORE . MO 212 15 OISPENSE
Telephone number. 410-764-2890
CA.REZONE PHARMACY

SAREZONEPHARMACY
eso HARBOUR WAY s.
COS l<f.G.1'0.

488814 ______
11
f:Xl'lt<ATION DA"f1'

0313112019 __,I

SUITE E ~::~.,,._:Cf'_qr= ..~ ~-rv.{fS:-;;

RICHMOND CA Chid. Division of Dru~ Control

: 162091 161

162091161
DEPARTMF.NT OF HEAl.;n I AND MEJ\'TAL HYGIENf:
DIVlSION OF DRUG CONTROL
420 1 PA:rTERSONAVF.. UALTIMORF.. MD2 ll15
Tdtphonc number. 4 !0·764·2890

TlllS CElfflFIES THAT TllEAPPLIC.·\:'H usn:u B£LOW IS Rl::CIST t REO TO DISPENSE

COYrROLU:D DANGEROUS SPBSTANCI'-.'> AS 1••:R Arl'UCArtOS

This registration is granted pursuant to title 5 of the Criminal Law Article of the Annotated Code of Marylaod, as
amended from time to time and is subject to all applicable statutes, rules and regulations regarding Controlled
Dangerous Substances.
C:D:; RfiG. NO.

0313112019
488814
f>XPIRAT ION Dl\Tli

CAREZONEPHARMACY
860 HARBOUR WAYS.
SUITE E
RICHMOND CA 94804 Van T Micchdl Audrey P. Clo.ck
S\!cri::1ari of lkallh nod Mcnr~I Hygi<'ll< Chkf. Division of Drug Conrml

DH M H-123 7 (Non Trnre-.forahk) POST IN A CONSPICUOUS PLACE

,\DDRESS AND/OR NAME CHANGE AOORt.'\S l\NOtlR l·h\ME CllANlif:, l'UoASE PRIN'J

FEE SSO-PAYBLE TO DHMH·DRUG CONTROL

Check box: D Business r\ddri:ss Chang.:

O ~umc Change Request:

Au nch Court Documents
D Mailing Addr.:ss Chanl)<! • N\l r~'\:
(other 1han the addr.:ss on lhc CDS pconit)
Ph:a~c complclc informauon al ri;:ln.
Dcta~h ~nd rc1um IO Drug Control.
111111111111 11 1 111 1 111 11
l'l ~c print .
CD
Ul!Mli·l ;J1 TTl
 Case: 4:18-cv-01005 Doc. #: 1-4 Filed: 06/20/18 Page: 8 of 10 PageID #: 49

THE UNIVERSITY OF THE STATE OF NEW YORK

EDUCATION DEPARTMENT

NEW YORK STATE BOARD OF PHARMACY

2015-18

THIS IS TO CERTIFY
CZ SERVICES INC
860 HARBOUR WAY S STE E
RICHMOND. CA 94804

is duly recorded as a

NON-RESIDENT ESTABLISHMENT
REGISTERED PHARMACY
In conformity with the provision of section 6808-b of the New York State Education Law

THIS CERTIFICATE IS EFFECTNE ON THE TIIlRD DAY OF JULY, 2015.

THIS CERTIFICATE EXPIRES ON THE THlRTIETH DAY OF JUNE, 2018.
Authorization to operate a non rest.dent establishment Is limited to the premises Indicated on the certificate.
The owner shall notify the New York State Board of Pharmacy of any change In ownership or address.

REGISTRATION NUMBER
033770 l!Xl!CUT1VE SECP.ETA.R Y
STAT1! BOARD OJ>
PHARMACY
 Case: 4:18-cv-01005 Doc. #: 1-4 Filed: 06/20/18 Page: 9 of 10 PageID #: 50

~ t tH 1 ·~.~.-- 1 ~r ·~·~ 1.... , ~ .~ -·~~21e1 .. )·! '. ~~: ,,.:. . ~ ~ ~ (·~~- ;\ .. ."
1 ~ • I •

' '•
.':? .' . ,: . . 'STATE· ·OF. 'TENNESSEE.
: IJ':,i ' • " DePARThlENT.'OF .
~~ . KEA L'TH .

""" 10 NUM8al: 0000tl06666

EXPIRATION DATE' 09f.lOl2017
Tllio io to certily lhDI all r~uitomonts of lhe Siok> of T enfKlUBfJ hnv& b#n ~.
PHARMACY BOARD
PHARMACY
CZ Sl!RVICES, INC.

CZ SERVICES, INC.
OBA CAREZONE PHARMACY
PO BOX 1827
RICHMOND CA 94802·0827
11.1 ...1.. 11 .. 1.11.111 .1.111 ••• 1.. 1... 1.11 ... 1.. 1. 11 ... 1... 111

II

TENNESSEE BOARV OF PHARMACY

PHARMACY
CZ SERVICES, INC.
VBA CAREZONE PHARMACY
860 HARBOUR WAY s. STE. E I

RICHMONV CA 94804
~ah~ dd off~ o/'~ ~ oj'@!Y"'~
~ ~ md.

ID NUMBER: 0 000005655
; ~~,~~1.¢.~ ;p.i\m~h o 9 / 3012o1 7

CONTROU:ED SUBSTANCE REGISTRATION

DCF171
 Case: 4:18-cv-01005 Doc. #: 1-4 Filed: 06/20/18 Page: 10 of 10 PageID #: 51

DEPA.RTMENl OF HEALlH PROFESSIONS

Number 021 4001773

Expires 12/31/2017
CZ Services, Inc. DBA CareZone Phamiacy
860 Harbour Way South, Suite E
Richmond CA 94804

Responsible Party Signature

Any name or address change requires the

submission of a new application. Contact the
Board office at (804) 367-4456 for information
and an application.

COMMONWEALTH OF VIRGINIA .
DEPARTMENT OF HEALTH PROFESSIONS
David E. Brown, D. C., Director

Caroline D. Juran BOARD OF PHARMACY 9960 Mayland Drive, Suite 300

Exec11live Director Henrico, VA 23233-1463
(80 4) 367-4456 w1vw.dhp. virgi11ia.govlpllarmacy

Non-resident Pharmacy Registration

CZ Services, Inc. DBA CareZone Pharmacy

860 Harbour Way South, Suite E
Richmond CA 94804

I~2/31/2017
Expires Number
0214001773
I
For Information About This License, visit our website: www.dhp.virginla.gov
To File a Complaint About a Licensee, Call: 1-800-533-1560