A Fifth Circuit panel has largely sided with CVS Pharmacy and its Caremark pharmacy benefit manager unit by affirming the dismissal of federal antitrust claims brought by a Mississippi pharmacy that was denied access to Caremark’s network, while reviving certain state law claims for further review.

In a published opinion issued Wednesday, the appeals court agreed that Rx Solutions Inc. failed to properly plead a viable federal antitrust case over its exclusion from Caremark’s PBM network. However, the panel ruled that the district court erred in declining jurisdiction over the pharmacy’s remaining state law claims, sending those issues back for further proceedings.

Writing for the panel, U.S. Circuit Judge Cory T. Wilson said Rx Solutions’ antitrust claims faltered at the threshold stage because the pharmacy did not adequately define a relevant product or geographic market.

“Rx Solutions’ proposed product market is ‘the prescription medication market,’” Judge Wilson wrote. “But Rx Solutions provides no explanation for why this is the appropriate delineation.”

The opinion said the amended complaint failed to allege facts addressing reasonable interchangeability or cross-elasticity of demand, both required elements for establishing a viable antitrust market.

“Without more, Rx Solutions’ bare definition of its proposed product market is insufficient as a matter of law, and fatal to Rx Solutions’ federal antitrust claims,” Judge Wilson said.

The panel was similarly unpersuaded by Rx Solutions’ proposed geographic market, which focused on Mississippi. According to the ruling, the pharmacy offered only a generalized assertion that the market included areas where Caremark’s PBM network and CVS pharmacies operate, without explaining the commercial realities or competitive dynamics of the industry.

The Fifth Circuit also concluded that Rx Solutions failed to plead antitrust injury, emphasizing that the complaint focused on harm to the pharmacy rather than to consumers.

“Rx Solutions nowhere explains how consumers have been harmed by Caremark and CVS,” Judge Wilson wrote. “Rather, the gravamen of Rx Solutions’ complaint is that Caremark and CVS have made it harder to compete with them. That is archetypical harm to a competitor, not harm to consumers.”

Rx Solutions alleged that CVS used its vertically integrated PBM structure to control prescription drug pricing and exclude independent pharmacies from the market. But the panel said the complaint did not allege higher prices, reduced supply, or diminished quality of prescription medications for consumers.

According to the ruling, Caremark first rejected Rx Solutions’ application to join its network in October 2022, citing inconsistencies between ownership disclosures and state corporate filings. After Rx Solutions challenged that decision, Caremark again denied participation in February 2023, raising additional concerns about alleged affiliations with Quest Pharmacy Inc. and with a prior owner, Harold Ted Cain, who had previously been found liable for False Claims Act violations.

Rx Solutions argued that Harold Ted Cain had no ownership or control over the pharmacy and that it had been accepted into multiple other PBM networks using the same ownership information.

U.S. District Judge Halil S. Ozerden dismissed the federal antitrust claims in January 2025 and declined to exercise jurisdiction over the remaining state law claims. On appeal, the Fifth Circuit agreed with the dismissal of the antitrust claims but held that diversity jurisdiction existed because CVS is domiciled in Rhode Island.

Even so, the panel affirmed dismissal of the Mississippi antitrust claim alongside the federal claims. However, it revived two other state law causes of action, including a tortious interference claim and a claim asserting a legal entitlement to participation in Caremark’s PBM network.

Those claims, Judge Wilson said, involve unresolved questions under Mississippi law, including whether a PBM qualifies as a health benefit plan, insurance company, or health maintenance organization.

“Given that, it would be premature for us to decide the viability of these two claims in the first instance,” the opinion stated.

The case now returns to the district court for further consideration of those remaining state law issues.

Counsel for the parties did not immediately respond to requests for comment.

The panel included U.S. Circuit Judges Leslie H. Southwick, Patrick E. Higginbotham and Cory T. Wilson.

Rx Solutions is represented by Patrick R. Buchanan of Brown Buchanan PA.

Caremark is represented by Seth A. Horvath and Jonathan Assia of Nixon Peabody LLP and D. Michael Hurst Jr. and Nash E. Gilmore of Phelps Dunbar LLP.

The case is Rx Solutions v. Caremark, case number 25-60084, in the U.S. Court of Appeals for the Fifth Circuit.