Corcoran et al v. CVS Health Corporation

Northern District of California, cand-4:2015-cv-03504

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7 Exhibit 26 REDACTED VERSION OF DOCUMENT SOUGHT TO BE SEALED 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF CALIFORNIA Christopher Corcoran, et al. on behalf of themselves and all others similarly situated, Case No. 15-CV-3504-YGR Plaintiffs, v. REDACTED VERSION OF CVS Pharmacy, Inc. DOCUMENT SOUGHT TO BE Defendant. SEALED (L.R. 79-5(d)(1)(C)) DECEMBER 9, 2016 REPORT OF BRETT E. BARLAG ON BEHALF OF CVS PHARMACY, INC. December 9, 2016 CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 1 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. Table of Contents I. EXPERIENCE AND QUALIFICATIONS ...................................................................................... 4 II. SCOPE OF ASSIGNMENT ............................................................................................................... 5 III. CASE OVERVIEW ............................................................................................................................ 5 IV. INFORMATION CONSIDERED ..................................................................................................... 6 V. SUMMARY OF OPINIONS .............................................................................................................. 6 VI. BACKGROUND ................................................................................................................................. 9 A. Description of the Transaction Data ................................................................................................. 9 1. The Number of Unique Prescription Purchases ............................................................................ 9 2. Classifying Each Prescription Purchase ...................................................................................... 12 3. Identifying Unique Customers .................................................................................................... 12 4. Information Absent from the Transaction Data .......................................................................... 14 B. Quantitative Summary of the Transaction Data .............................................................................. 15 C. HSP Program Background .............................................................................................................. 19 D. Retail Price ......................................................................................................................................... 23 VII. OPINIONS......................................................................................................................................... 27 Opinion 1: The HSP program was a small part of CVS's business, most notably its Cash business. .... 27 Opinion 2: Purchases under CVS's HSP program and CVS's Cash purchases differed in several fundamental respects. .............................................................................................................................. 30 a) Right to Access a Price Schedule vs. Pricing at CVS's Discretion ................................................ 30 b) Adjudicated Transaction vs. Non-Adjudicated Transaction ........................................................... 31 c) Membership Fee vs. No Fee............................................................................................................ 31 d) 90-Day Supply vs. Any Supply ........................................................................................................ 32 e) 90-Day-Based Minimum Price vs. Minimum Price Not Based on a Specific Quantity .................. 35 f) Limited Formulary vs. Open Formulary ......................................................................................... 37 Opinion 3: Inconsistencies with Plaintiffs' Exhibit 12 impugn the reliability of Dr. Hay's damages calculation. .............................................................................................................................................. 38 Opinion 4: The lack of information important to assessing the impact of a change to the submitted U&C on the patient's copayment amount implicates the reliability of Dr. Hay's damages calculation. 40 Opinion 5: Dr. Hay relies upon his recalculated HSP-based U&C prices to calculate damages; because his methodology for recalculating his HSP-based U&Cs suffers from multiple flaws, his calculation of damages is not reliable. ........................................................................................................................... 41 Opinion 6: Dr. Hay's calculation of damages is significantly reduced if his damages calculation is adjusted to account for the fact that HSP prices were not prorated downward. ..................................... 45 CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 2 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. Opinion 7: Dr. Hay's calculation of damages is significantly reduced if his damages calculation is adjusted to account for statements made regarding CVS's HSP program in Declarations and deposition testimony taken from PBMs which processed the most claims during the relevant period. ................... 46 CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 3 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. I. EXPERIENCE AND QUALIFICATIONS 1. I am a Senior Managing Director and member of the Health Solutions Practice at FTI Consulting, Inc. ("FTI"), a global financial advisory and consulting firm. Prior to joining FTI, I was a Manager at Arthur Andersen, LLP and KPMG, LLP and served as the Chief Financial Officer and Chief Strategy Officer at Maxim Healthcare Services, Inc. 2. I work extensively with healthcare industry companies and their counsel to address regulatory investigations, qui tam actions, and complex industry litigation; assess and strengthen their regulatory compliance programs and processes; identify, implement, and measure regulatory process improvements; navigate the impact of regulatory changes on their businesses; and improve their financial and operational performance. I have worked with industry companies including, but not limited to, pharmaceutical and medical device companies; drug and medical supply wholesalers and distributors; retail pharmacies; long-term care pharmacies; hospitals and hospital systems; sub and post-acute healthcare providers including home healthcare and hospice companies; and healthcare information technology companies. 3. I also have significant experience in corporate, financial, and accounting management positions in the healthcare industry. I served as the Chief Financial Officer and Chief Strategy Officer for Maxim Healthcare Services, Inc., a national diversified healthcare services company with patient care operations in 43 states and a funding source base that included Medicare, Medicaid, Commercial Third-Party Payers, and self-pay patients. In that role, I was responsible for leading the company's financial and accounting operations, payer reimbursement operations, corporate strategy functions, and government affairs department. 4. I graduated with honors from the University of Notre Dame with a Bachelor of Arts degree and subsequently received a Master of Business Administration degree from Columbia Business School, Columbia University. I am also a member of the Healthcare Financial Management Association (HFMA) and an associate member of the Association of Certified Fraud Examiners (ACFE). 5. Appendix B contains a summary of my education, work experiences, prior testimony within the last four years, and publications/seminars that I have authored within the last ten years. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 4 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. II. SCOPE OF ASSIGNMENT 6. I have been retained by counsel for CVS Pharmacy, Inc. to analyze and offer opinions regarding issues pertaining to purchases of drugs under the company's Health Savings Pass ("HSP) program; purchases of HSP-eligible drugs that did not occur under the HSP program; and certain analyses and conclusions set forth by Dr. Joel W. Hay in declarations prepared in support of Plaintiffs' motion for class certification. The following Expert Report ("Report") and attachments summarize my review and analyses that support my opinions thus far in this matter. My firm is being compensated for my work at the hourly rate of $650. My firm is also being compensated for individuals working under my direction in this matter; the billing rates for these individuals range from $100 to $550 per hour. III. CASE OVERVIEW 7. CVS Pharmacy, Inc. is ("CVS") a subsidiary of CVS Health Corporation headquartered in Woonsocket, Rhode Island. It is currently the largest pharmacy chain in the United States with 9,655 retail stores and 7,897 pharmacies across 49 states, the District of Columbia, Puerto Rico and Brazil. CVS operates in 98 of the 100 drugstore markets in the U.S. and holds the number one or number two market share in 93 of these markets.1 8. CVS's retail stores typically sell prescription drugs and over-the-counter drugs, as well as beauty products and cosmetics, personal care products, convenience foods, photo finishing services, seasonal merchandise and greeting cards.2 In 2015, CVS filled approximately 1 billion prescriptions and had a 21.7% share of the United States retail pharmacy market.3 Prescription drugs made up nearly 73% of CVS Retail/LTC net revenue in 2015.4 9. On April 4, 2016, Plaintiffs filed the operative complaint (the "Complaint") against CVS asserting, as is relevant to my analysis, that CVS overcharged pharmacy customers using insurance for generic prescription drugs by submitting claims for payment to pharmacy benefit managers ("PBMs") or to third-party payers ("TPPs") at prices above its U&C. I understand that Plaintiffs have argued that after CVS implemented its HSP program, which offered generic drugs at preferential prices to customers who enrolled in the program, CVS should have begun reporting the HSP program price as its U&C when submitting claims for reimbursement to PBMs and TPPs. 1 CVS Health Corp – CVS, Form 10-K, Filed: February 9, 2016 - Exhibit 21, Pg. 14, 2, 3, 6. 2 Ibid., Pg. 7. 3 Ibid., Pg. 6. 4 Ibid., Pg. 7. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 5 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. IV. INFORMATION CONSIDERED 10. The opinions expressed in this Report are based on my skills, knowledge, education, experience and training as well as the information made available to me as of the date of this Report. During the course of my work in this matter, I examined various documents and data that have been filed with the court, reviewed and analyzed documents and data produced in this litigation by the parties, reviewed and analyzed multiple depositions in this matter, and reviewed and analyzed documents that are publicly available through various websites. A list of the documents and data considered is found in Appendix C. The opinions contained herein are the results of my investigations to date, and I reserve the right to supplement, amend or alter these opinions based on information that hereafter becomes available to me. My opinions are to be used for the specific purposes of this lawsuit and are not to be used for any other purpose without the express written consent of FTI. V. SUMMARY OF OPINIONS 11. My summary of opinions in this Report is as follows: 12. Opinion 1: CVS's HSP program was a small part of CVS's business, most notably its Cash business. Contrary to Plaintiffs' allegations, CVS's Cash business was substantially larger than CVS's HSP program. For example, CVS's Cash business had over 25 times as many customers, over 4.5 times as many prescription purchases, and generated over 5.5 times as much revenue as the HSP program. This fact—that CVS's Cash business was substantially larger than the HSP program by any of these measures—was true for every year of the HSP program's existence and in all 11 states for which the Plaintiffs seek to certify a class. 13. Opinion 2: Purchases under CVS's HSP program and Cash purchases differed in several fundamental respects. Based on the data and documents I have reviewed, there are no less than six observable differences between Cash purchases at CVS and purchases made under the HSP program, which bear on the issues presented. 14. First, as the data and HSP program documents demonstrate, CVS customers who enrolled in the HSP program were entitled to purchase up to a standard day supply of medications on the program formulary for a predetermined price (e.g., $9.99 prior to 2011; $11.99 2011 forward), whereas CVS's customers making a Cash purchase were not assured any particular price for medications and CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 6 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. certainly were not entitled to pay only a predetermined price (e.g., $9.99/$11.99) when they purchased an HSP standard day supply of an HSP-eligible medication. 15. Second, a PBM processed or "adjudicated" an HSP purchase, whereas Cash purchases were not adjudicated. 16. Third, the data demonstrate HSP members paid a membership fee. Cash customers paid no such fee. When the fee amount is considered, as well as the relative infrequency with which Cash customers typically fill prescriptions during a year, an average of 78.65% of the Cash customers I analyzed would have paid more to join the HSP program and fill their Cash prescriptions as HSP members. The average additional costs – the "premium" – incurred by those customers would have been approximately 61.52% of their actual Cash prescription expenditures. 17. Fourth, HSP program purchases were predicated on purchasing a 90-day supply of the medication. By contrast, Cash purchases infrequently involved a 90-day supply and, unlike HSP, were not predicated on purchasing specific days supply quantities. 18. Fifth, and related to the fourth difference, the HSP program price for a 90-day supply was a minimum price. Even if the HSP member filled a prescription for less than a 90-day supply, the purchase price was the 90-day supply price. By contrast, a Cash customer who purchased a 90-day supply from CVS typically paid a higher price than a Cash customer who purchased less than a 90- day supply. Contrary to Plaintiffs' theory, this minimum-price component of the HSP program was consistently observed in the data, as 99.46% of HSP purchases that involved less than the HSP standard days supply were priced no lower than the standard HSP price. The data therefore disproves Plaintiffs' allegation that "CVS pharmacists routinely prorated prescriptions written for less than 90- days. . . [e.g.,] charge a HSP member roughly $3.33 for a 30-day supply."5 Approximately 74.13% of the purchases for the putative class members identified by Plaintiffs' expert Dr. Hay involved a copayment (i.e., the payment amount captured in the POS_SELL_PRC_AMT field) less than the HSP price; the same is true of each allegedly over-priced prescription identified for eight named Plaintiffs in interrogatory answers (Avis [AZ], Brown [TX], Caine [GA], Corcoran [CA], Gilbert [TX], Hagert [PA], Odorisio [NY], and Wulff [OH]). 19. Sixth, the HSP program had a limited formulary of medications, whereas a Cash customer could purchase any medication sold by the CVS pharmacy. In my report, I quantify by National Drug Code 5 Third Amended Class Action Complaint, Pg. 21:12-14. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 7 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. ("NDC") and Generic Code Number ("GCN") the number of medications observed in the data from HSP purchases.6 20. Opinion 3: Inconsistencies with Plaintiffs' Exhibit 12 impugn the reliability of Dr. Hay's damages calculation. Exhibit 12 to Plaintiffs' Motion for Class Certification is described as a "list of qualifying contracts." Dr. Hay's understanding is that Exhibit 12 is a set of contracts that would fit the class definition. My review of the record and the data produced in this matter raises questions about the reliability of Exhibit 12 to identify specific Condor Codes under which transactions would be subject to damages under Dr. Hay's methodology. In that regard, Dr. Hay's use of Exhibit 12 calls into question the reliability of his ultimate damages calculation. 21. Opinion 4: The lack of information important to assessing the impact of a change to the submitted U&C on the patient's copayment amount implicates the reliability of Dr. Hay's damages calculation. Dr. Hay's damages calculation consists of two components: the patient's actual copayment amount and Dr. Hay's recalculated HSP-based U&C price. With respect to the former, Dr. Hay lacks information which can be important to quantifying the impact on a patient's copayment attributed to changes in the submitted U&C. The unavailable information includes the details of the patient's cost sharing responsibilities; a complete record of all benefit claims for a given patient during a given benefit period; and the adjudication logic a PBM or TPP used to adjudicate – or in the event of an adjustment to a claim re-adjudicate – the patient responsibility amount. 22. Opinion 5: Dr. Hay relies upon his recalculated HSP-based U&C prices to calculate damages; because his methodology for recalculating his HSP-based U&Cs suffers from multiple flaws, his calculation of damages is not reliable. With respect to the second component of Dr. Hay's damages calculation – his recalculated HSP-based U&C price – his methodology for calculating these prices suffers from methodological flaws which impugn the reliability of his damages calculation. Specifically, Dr. Hay prorates HSP prices when recalculating his HSP-based U&Cs despite the fact that CVS did not prorate its standard HSP prices for quantities less than the standard HSP days supply. By accepting these methodological flaws when 6 An NDC is a unique 3-segment numeric identifier assigned to drug products by the FDA. http://www fda.gov/Drugs/developmentapprovalprocess/UCM070829. A Generic Code Number is a standard number assigned by First DataBank (a drug pricing service) to each strength, formulation, and route of administration of a drug entity. One drug entity may have multiple GCNs, depending on the product's available strengths (e.g., 50 mg, 100 mg, etc.), forms (e.g., tablet, capsule, liquid, etc.), and routes of administration (e.g., oral, transdermal, injectable, etc.) https://www.cms.gov/Research-Statistics-Data-and- Systems/Research/HealthCareFinancingReview/downloads/04springpg25.pdf. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 8 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. calculating his HSP-based U&C prices, Dr. Hay achieves an HSP-based U&C price for calculating damages which is rarely paid, if it is ever paid, despite his own statement that "for a pharmacy to submit U&C prices to TPPs and PBMs that are not routinely paid by cash customers, much less paid at all, is contrary to the industry standard of a U&C price." 23. Opinion 6: Dr. Hay's calculation of damages is significantly reduced if his damages calculation is adjusted to account for the fact that HSP prices were not prorated downward. Related to Opinion 5, if Dr. Hay's damages methodology is adjusted to account for the fact that HSP prices were not prorated downward, Dr. Hay's damages are reduced to $257,091,890. This result reflects the difference between the copay actually paid (i.e., the POS paid by TPP members) and the standard HSP price, unless the days supply is greater than the standard HSP days supply; in that case, the HSP price is prorated upward. 24. Opinion 7: Dr. Hay's calculation of damages is significantly reduced if his damages calculation is adjusted to account for statements made regarding CVS's HSP program in Declarations and deposition testimony taken from PBMs which processed the most claims during the relevant period. I have reviewed the Declarations from executives at some of the country's largest PBMs. In those Declarations, representatives from the PBMs indicated that they were aware of CVS's HSP program, did not believe the HSP price should have been treated as the U&C price, and did not expect CVS to submit its HSP price as the U&C price. If Dr. Hay's damages calculation is adjusted to account for those statements, his damages are reduced by $753,920,102; if adjustments are made to account for those statements as well as the aforementioned methodological flaws, Dr. Hay's damages are reduced to $92,412,357. VI. BACKGROUND A. Description of the Transaction Data 1. The Number of Unique Prescription Purchases 25. In this case, CVS produced 26 data files containing over 930,000,000 lines of pharmacy transactions for dates of service beginning November 9, 2008 through December 7, 2015. The data were limited to the following twelve states and the District of Columbia: Arizona; California; Washington, D.C.; Florida; Georgia; Illinois; Massachusetts; Maryland; New Jersey; New York; Ohio; Pennsylvania; and Texas. In addition, two supplemental files containing Coordination of CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 9 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. Benefits ("COB") pharmacy transactions were produced; the supplemental files were not state specific. The 26 data files and two supplemental files contained pharmacy transactions for HSP- eligible drugs only (Bates numbered DCVS – 00000000001- DCVS - 00936214895). In total, the files produced contained 936,214,895 lines of data. 26. In Appendix A, I have provided a list of the data fields in the produced data utilized in my review and analysis. Included in the list of data fields is the produced field name, an "alias" for each field name which I use throughout my Report, and a non-technical description of each field name. 27. From the 936,214,895 lines of transaction data, I identified 873,846,060 unique prescription purchases made at CVS pharmacies. I arrived at this number by the following steps: a. First, I removed all transactions for CVS stores located in Maryland and Washington, D.C. My understanding is that Plaintiffs are no longer seeking to certify classes of CVS customers from Maryland or Washington, D.C. This step reduced the total records by 39,206,963—from 936,214,895 to 897,007,932. b. Second, I counted as a single purchase multiple lines of data that I determined were associated with a single prescription purchase involving coordination of benefits ("COB"). In a COB claim, two or more payers are associated with a single, distinct prescription claim for an individual customer. Because multiple payers are associated with a single claim, COB claims appear as multiple records in the data (i.e., one row for each payer associated with the claim). Each row associated with such claims contained the same Transaction Number. For purposes of my calculation, I used the row associated with the "highest" numeric value in the Claim Hierarchy Number (i.e., the Claim Hierarchy Number which should correspond with the last payer in the sequence of payers).7 Accounting for COB claims reduced the total count by 22,351,591 – from 897,007,932 to 874, 656,341. 7 For COB claims, the values in a given data field are consistent row-to-row except for the Third Party Paid Amount and the Sales Tax. However, I was not ignoring information by focusing only on the row with the highest Claim Hierarchy Number; for the Third Party Paid Amount and Sales Tax fields, I summed the values in those fields across each row associated with the same Transaction Number and relied upon the summed amounts in my analyses. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 10 7 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. 2. Classifying Each Prescription Purchase 29. To facilitate my analyses, I assigned each of the 873,846,060 unique prescription purchases to one of four categories: (1) "Third-Party," (2) "Cash," (3) "Cash Discount," and (4) "HSP." 30. Figure 2 below breaks down the 873,846,060 unique prescription purchases by each of the four categories. Figure 2 – Yearly Summary of Prescription Purchases by Category Total Type of 2008 2009 2010 2011 2012 2013 2014 2015 Prescription Purchase Purchases Third-Party 14,391,802 103,688,101 107,329,288 113,414,659 119,504,173 118,283,140 120,507,558 117,578,864 814,697,585 Cash 779,214 4,884,941 4,316,382 4,012,092 3,923,828 3,586,917 3,064,108 2,625,907 27,193,389 Cash Discount 272,306 2,265,216 2,964,035 3,811,755 4,160,691 4,294,223 4,227,139 4,130,479 26,125,844 HSP 75,341 964,738 1,299,009 1,096,822 847,139 655,180 510,032 380,981 5,829,242 Total 15,518,663 111,802,996 115,908,714 122,335,328 128,435,831 126,819,460 128,308,837 124,716,231 873,846,060 31. The Prescription Purchase Data produced in this case only involved HSP-eligible drugs, not all drugs purchased at CVS pharmacies (e.g., brands, generics not on the HSP formulary). Accordingly, the analyses throughout this Report are based only on HSP-eligible drug purchases. 3. Identifying Unique Customers 32. I determined that 74,488,676 unique CVS customers purchased the 873,846,060 unique prescription purchases described above. 10 Deposition of William Boyd, Tr. 111:1-3. 11 Notably, HSP program purchases (i.e., where the Condor Code is 26240) have a value of "Cash Discount" in the AG Type Description field. This suggests that when CVS was setting up Condor Code 26240 in its system, CVS did not consider purchases using Condor Code 26240 as "Cash" purchases, as "Cash" was assigned a Condor Code less than 100. 12 Deposition of William Boyd, Tr. 109:8-18. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 12 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. 33. However, determining the number of unique customers was not a straight-forward exercise. 34. 36. 37. 13 Deposition of William Boyd, Tr. 68:10-11and Tr. 86:2-9; Deposition of Hilary Dudley, Tr. 57:4-22. 14 Deposition of William Boyd, Tr. 86:2-9; Deposition of Hilary Dudley, Tr. 57:4-22. 15 I excluded combinations of Store-level Patient ID and RXC Patient ID where the latter was populated with a Null value or a default, non-specific value such as "0" or "999999999999". CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 13 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. 38. Figure 3 below summarizes the number of unique CVS customers I identified in the Prescription Purchase Data in each year. Figure 3 – Yearly Summary of Unique Customers Across All Purchase Types 2008 2009 2010 2011 2012 2013 2014 2015 Total Unique Customers 7,428,635 22,330,484 22,709,602 22,017,297 23,168,357 23,575,465 23,537,905 23,633,582 74,488,676 4. Information Absent from the Transaction Data 39. I observed that certain information about CVS customers was not available in CVS's transaction data. 40. First, the data did not contain the details of the cost sharing responsibilities for each individual patient as defined by their respective benefit plan. For example, the data did not indicate whether the patient had a deductible, the amount of the deductible, or the amount of the deductible met as of each date of service. Nor did the data contain information about potential deductible exemptions. The data did not contain information as to whether the patient had a maximum out-of-pocket limit on their cost-sharing responsibilities or the patient's position relative to that limit on a given date of service. Nor did it indicate whether the patient was entitled to reimbursement for his or her copayments paid to the pharmacy. 41. Second, CVS's record of prescription purchases is not necessarily a complete record of all benefit claims for a given patient during a given benefit period. CVS's record of prescription purchases may not even represent a complete record of all prescription benefit claims in the event that a patient filled prescriptions at non-CVS pharmacies. Furthermore, the transaction data produced in this litigation may not represent all prescription benefit claims associated with prescriptions filled by a patient at CVS stores as the data is limited (1) to claims for HSP-eligible drugs and (2) to claims only in the 13 jurisdictions identified above. 42. Third, the data did not contain the adjudication logic used by the PBM or the TPP used to calculate the amount of costs for which the patient was responsible at the time the claim was originally filled, or the adjudication logic the PBM or TPP would use to re-adjudicate the patient responsibility amount should there be an adjustment to a claim that has already been paid. Although a number of CVS's contracts with PBMs and TPPs have been produced in the litigation, the contracts CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 14 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. I reviewed do not specify adjudication logic regarding how an individual insured's copayment is calculated. B. Quantitative Summary of the Transaction Data 43. The 873,846,060 unique purchases reflect purchases made at 5,044 unique pharmacy locations; by 74,488,676 unique CVS customers; of 6,277 distinct NDCs that fall within 463 GCNs; and were processed under 2,455 distinct Condor Codes.16 44. Figure 4 below breaks down these figures across the 11 states for which the plaintiffs are seeking to certify state classes. Figure 4: Summary of Data Metrics by State 45. Of the 873,846,060 prescription purchases, Third Party comprised 93.23%, or 814,697,585 purchases; Cash comprised 3.11%, or 27,193,389 purchases; Cash Discount comprised 2.99%, or 26,125,844 purchases; and HSP comprised 0.67%, or 5,829,242 purchases. Figures 5 and 6 summarize these percentages and counts. 16 On instructions from counsel, I have analyzed for purposes of this Report all NDCs and associated purchases in the data produced in this litigation. Included in my analysis are 512 NDCs which I understand were erroneously added to the HSP program by the original PBM administrator. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 15 7 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. Figure 7: Summary of Prescription Purchases by Type of Purchase and State 47. Just as HSP purchases were the least prevalent type of purchase at a CVS pharmacy, HSP members were the least prevalent type of customer at a CVS pharmacy. Far fewer HSP members made HSP prescription purchases than customers who made Cash, Cash Discount, or Third Party purchases. Figures 8 and 9 below show just how outsized the differences were between the volume of HSP members and the volume of customers in each of the other groups. Figure 8: Summary of Customers by Type of Purchase Total Category Customers Third-Party 65,319,284 Cash 13,430,834 Cash Discount 6,943,743 HSP 517,479 CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 17 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. Figure 9: Summary of Customers by Type of Purchase and State17 48. I also observed significant differences between the volume of Cash purchases and customers and the volume of HSP purchases and members. Specifically, when the number of Cash purchases is compared to the number of HSP purchases, the Cash purchases outnumber HSP purchases by a ratio of over 4.5 to 1. Similarly, Cash customers significantly outnumbered HSP members by a ratio of over 25 to 1. Specifically, 13,430,834 distinct customers made Cash prescription purchases, whereas only 517,479 HSP members made purchases under the HSP program. 49. Although the number and frequency of Cash purchases and customers substantially outweighed the number of HSP purchases and members, importantly, the average Cash customer filled fewer prescriptions each year when compared to HSP members. Cash customers filled an average of between one and two Cash prescriptions per year whereas HSP members filled an average of five HSP prescriptions per year, according to the produced data. 50. The total payments made by HSP members (i.e., the POS) further underscores that the HSP program comprised a relatively small proportion of CVS's pharmacy business. Including HSP membership fees, HSP members paid $82.7 million in HSP purchases. Although that is a sizable absolute number, it constitutes only 1.69% of the total dollars paid as reflected in the POS across all 873,846,060 unique prescription purchases. 17 Cash Discount Customer counts within Figure 9 have been updated from the figure included in my report submitted in connection with CVS's Opposition to Class Certification (October 3, 2016) to exclude COB transactions. In this Report, there are a couple of other minor adjustments that have been made, and in such circumstances, I have identified the adjustment in an explanatory footnote. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 18 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. 51. C. HSP Program Background 52. CVS launched the HSP program in November 2008, after other retail pharmacies introduced their own promotional generic programs.18 The HSP program was a generic drug membership program. Generic drugs tend to be low-cost drugs, with prices often 80% - 85% below prices of the comparable brand drug.19 53. To participate in the HSP program, customers paid an annual membership fee, completed an enrollment form, and agreed to certain program terms and conditions. Membership entitled customers to pay standard HSP prices for a defined set of drugs and days supply of those drugs.20 The membership fee was $10 from November 2008 through December 2010 and $15 from January 2011 through the end of the program.21 54. From the CVS Prescription Purchase Data, I calculated 889,003 "Membership Years" for the period on or after September 29, 2009.22 A Membership Year is a one-year period measured from either the date of each HSP member's first HSP purchase in the program or the anniversary date of the member joining the program.23 55. I observed in the Prescription Purchase Data payment of the membership fee for 721,515 Membership Years (81.16% of all Membership Years) totaling $9.7 million.24 My understanding is that these were membership fees paid by HSP members at the pharmacy. The 721,515 Membership 18 February 2, 2016 Deposition of Thomas Morrison, Tr. 79:4-6; July 20, 2016 Deposition of Thomas Morrison, Exhibit 40. 19 http://www.fda.gov/Drugs/ResourcesForYou/Consumers/BuyingUsingMedicineSafely/UnderstandingGenericDru gs/ucm305896 htm. 20 Deposition of Hilary Dudley, Tr. 193:19-194:3. 21 Deposition of Susan Colbert, Tr. 169:11-17. 22 CVSC-0022954-22956 is a communication to all pharmacy teams with a revised CVS policy to collect the customer's membership fee along with the POS amount unless paid over the internet or by phone. Prior to September 29, 2009, the membership fee was captured in a transaction using the default NDC 00000-0000-64. 23 Excluded from my count of Membership-Years are those periods when an HSP member had no HSP purchases. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 19 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. Years are associated with 84.52% of distinct HSP members and covers the time period in which more than 87% of HSP purchases were made (subsequent to September 29, 2009). 56. I understand that some HSP members paid their membership fee over the phone or internet and that those fees are not reflected in the transaction data. In addition, I understand that membership fees paid for Membership Years starting prior to September 29, 2009 do not appear in DCVS – 00000000001- DCVS - 00936214895.25 Thus, I would not expect to observe membership fee payments in the transaction data for all 889,003 Membership Years. 57. I observed 3,271 unique NDCs across the 5,829,242 HSP purchases. I understand that NDCs were added and removed from the list of HSP eligible drugs over time. 58. The schedule of standard HSP prices was organized by Drug Category and Days Supply with changes to program prices over time. The following table outlines the schedule of standard HSP prices over the relevant time period: Figure 10: Standard HSP Prices, Days Supply and Effective Dates by Drug Category26 Drug Drug Effective Standard Purchases End Date Standard Category Date HSP Price Days Supply 11/9/2008 12/31/2010 $9.99 Usual Drugs 5,673,828 90 1/1/2011 12/7/2015 $11.99 11/9/2008 6/30/2013 $8.99 Antibiotics 72,655 <= 30 7/1/2013 12/7/2015 $10.99 Exception 11/9/2008 12/31/2010 $23.99 38,355 90 State Drugs27 1/1/2011 12/7/2015 $25.99 Women's 11/9/2008 7/31/2011 $23.99 41,807 90 Health 8/1/2011 12/7/2015 $25.99 11/9/2008 7/31/2011 $26.95 Flu 2,127 8/1/2011 8/31/2013 $26.99 1 9/1/2013 12/7/2015 $28.79 Diabetes Test 470 1/1/2011 12/7/2015 $29.99 30 Strips 25 CVSC-0022955; CVS's enrollment materials allowed customers to enroll at the point-of-sale, by phone, or online at cvs.com. 26 Figure 10 is updated for certain NDC classifications of Antibiotics, Exception State Drugs and Women's Health. 27 Based on information provided in CVSC0008309 – CVSC0008315 I observed that both California and Pennsylvania were classified as "Exception States" on the HSP Formulary. California was identified as such through approximately March 2009 and Pennsylvania was so identified throughout the relevant period. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 20 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. 59. Purchases under CVS's HSP program were adjudicated by a third party PBM.28 The adjudicating PBM may have priced a purchase for a quantity that exceeded the standard HSP quantity at an amount higher than the standard HSP price (e.g., higher than $9.99/$11.99 for Usual Drugs). However, HSP purchases for quantities below the standard HSP quantity were priced at the standard HSP price (e.g., priced at $9.99/$11.99 for Usual Drugs).29 CVS's HSP program documentation required that pharmacies charge the standard HSP price, even if an HSP member was purchasing a quantity that was less than the standard HSP quantity.30 60. Based on the evidence I have reviewed, the purpose of the HSP program was to retain existing CVS customers.31 The HSP program was not aimed at attracting new customers.32 According to HSP implementation documents, the key audiences for the HSP program were:  "Customers indicating that they will be transferring their medication to a competitor because of promotional or discount pricing  Customers inquiring about pricing of medications compared to a competitor's promotional or discount program  Cash customers price shopping for prescription prices  Customers who are known to have recently transferred a prescription(s)  Customers on the adherence call list indicating they are trying to make their medications last because they cannot afford to fill every month  Customers on the consolidation call list who, when counseled, indicate that they fill prescriptions with a competitor due to promotional or discount pricing."33 61. In communications to its pharmacists, CVS emphasized the program was "not intended for everyone."34 Indeed, two fundamental features of the program's design were inconsistent with the prescription purchases made by large numbers of CVS's Cash customers: the HSP membership fee and the HSP pricing around a 90-day supply. 28 Deposition of William Boyd, Tr. 110:24-111:9. 29 Huddle Document CVSC0001803; July 20, 2016 Deposition of Thomas Morrison, Tr. 167:23-168:15. 30 Huddle Document CVSC0001803; July 20, 2016 Deposition of Thomas Morrison, Tr. 167:23-168:15. 31 Huddle Document CVSC0001801. 32 February 2, 2016 Deposition of Thomas Morrison, Tr. 88:9-18. 33 Huddle Document CVSC0001804. 34 Huddle Document CVSC0001804. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 21 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. a. The membership fee. Due to the membership fee, a significant percentage of Cash customers would have paid more to fill their prescriptions had they joined the HSP program. First, over 67% of Cash customers filled only one Cash prescription during the relevant period. Second, looking across all of the Cash prescription purchases I analyzed, on average 78.65% of Cash customers would have spent more to fill their Cash prescriptions under the HSP program than they did in the normal course.35 The average additional cost (or premium) on those prescriptions would be 61.52% greater under the HSP program than the actual Cash expenditures.36 The data reveal that the percentage of Cash customers who would have paid more under the HSP program, and the size of the additional premium, was significant throughout each year of the program.37 Figure 11: Yearly Summary of Cash Customers Who Would Have Paid More by Joining HSP38 Cash Customers Who Would Pay More by Joining HSP Percent Premium All Cash Percent of All Year Customers above Cash Customers Cash Customers Expenditures 2008 550,411 335,530 60.96% 49.78% 2009 2,559,776 1,774,547 69.32% 48.91% 2010 2,301,047 1,665,839 72.39% 46.37% 2011 2,169,735 1,802,909 83.09% 63.38% 2012 2,175,566 1,815,301 83.44% 64.05% 2013 2,082,832 1,764,573 84.72% 65.20% 2014 1,804,852 1,501,620 83.20% 70.82% 2015 1,453,709 1,213,819 83.50% 76.20% b. Pricing around a 90-day supply. The HSP program's organization around a 90-day supply likely limited membership as well. Only 11.24% of all non-HSP purchases filled at CVS pharmacies were for a 90-day supply or more.39 The percentage of Cash purchases was even lower; only 6.05% of Cash purchases were for a 90-day supply or 35 This percentage has been updated to account for an adjustment in the weighting used to calculate the average. 36 Ibid. 37 My analysis is based on Cash prescription purchases made by customers who did not join the HSP program during the relevant period. In addition, my analysis assumes no price response and static demand. The yearly breakdown is based on an assumed membership anniversary date. 38 This table has been updated to account for rounding differences. 39 Non-HSP purchases include Third Party, Cash, and Cash Discount. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 22 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. more. Considering that the policy of the HSP program was to charge the standard HSP program price even when the HSP member purchased less than a 90-day supply, it is understandable why a majority of consumers did not join the HSP program. 62. According to the data, of the 74,488,676 million customers who purchased an HSP-eligible product in any type of purchase (i.e., Third Party, Cash, Cash Discount, or HSP), only 517,479 customers, or 0.69%, were ever members of the HSP program. 63. For the HSP-eligible drugs categorized as "Usual Drugs", which constituted 97.33% of all HSP purchases, I calculated that 99.50% of the 90-day prescriptions were charged at the expected HSP price and not below that price. Furthermore, of the 1,205,295 HSP purchases across all Drug Categories in which the customer filled less than the standard HSP days supply, I calculated that 1,198,751 (99.46%) of the purchases were charged the expected HSP price and not below that price.40 Based on this, I see no evidence in the data of any regular or systemic disregard of the policy that the HSP program's standard price (e.g., $9.99/$11.99) is to be charged even when a customer purchases an amount less than the HSP standard days supply. D. Retail Price 64. Currently, CVS performs a multi-step process to determine the retail price pharmacies charge to Cash-paying customers. That retail price is also transmitted as CVS's U&C price on an insured purchase for a comparable prescription (e.g., same drug, same quantity, same day, same pharmacy).41 40 I have excluded 2,127 prescription purchases for the Drug Category "Flu" as the standard HSP days supply for Flu is one day. 41 February 4, 2016 Deposition of Sevak Melkonian, Exhibit 4; Deposition of Scott Tierney, Tr. 78:25-79:9. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 23 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. Figure 12: Retail Price Calculation Steps in RxConnect42 42 February 4, 2016 Deposition of Sevak Melkonian, Exhibit 4. 43 February 4, 2016 Deposition of Sevak Melkonian, Tr. 22:17-23:1. 44 February 4, 2016 Deposition of Sevak Melkonian, Tr. 27:23-28:1. 45 July 21, 2016 Deposition of Sevak Melkonian, Tr. 44:7-10. 46 July 21, 2016 Deposition of Sevak Melkonian, Tr. 43:10-44:4. 47 February 4, 2016 Deposition of Sevak Melkonian, Tr. 84:8-24; Exhibit 4. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 24 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. 67. 68 48 February 4, 2016 Deposition of Sevak Melkonian, Tr. 25:11-26:22; Exhibit 4. 49 February 4, 2016 Deposition of Sevak Melkonian, Tr. 28:8-17. 50 February 4, 2016 Deposition of Sevak Melkonian, Tr. 36:3-37:7. 51 Deposition of William Boyd, Tr. 66:7-13; July 21, 2016 Deposition of Sevak Melkonian, Tr. 22:6-12. 52 February 4, 2016 Deposition of Sevak Melkonian, Tr. 26:10-22 and 53:7-19; Exhibit 4. 53 February 4, 2016 Deposition of Sevak Melkonian, Tr. 55:1-6. 54 February 4, 2016 Deposition of Sevak Melkonian, Tr. 81:23-82:13. 55 February 4, 2016 Deposition of Sevak Melkonian, Tr. 79:22-25. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 25 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. 70. Figure 13 shows for each days supply the percentage of Cash prescription purchases which occurred at or above the Minimum Retail Price. Because CVS changed its Minimum Retail Price from $10.99 to $11.99 on August 1, 2010, I provided breakdowns for prescription purchases made before, versus on or after, that date.59 Figure 13: Cash Purchases At or Above the Minimum Retail Price Total Purchases Prior to August 1, 2010 Total Purchases On or After August 1, 2010 Total Cash Purchases At or Above % At or Above At or Above % At or Above At or Above % At or Above Days Supply Total Min. Retail Min. Retail Total Min. Retail Min. Retail Total Min. Retail Min. Retail Category Price Price Price Price Price Price 5 Days 387,947 364,394 93.93% 909,954 866,600 95.24% 1,297,901 1,230,994 94.84% 7 Days 770,184 723,914 93.99% 1,942,700 1,883,334 96.94% 2,712,884 2,607,248 96.11% 10 Days 1,103,855 1,029,051 93.22% 2,468,525 2,363,302 95.74% 3,572,380 3,392,353 94.96% Other: < 30 Days 1,438,722 1,307,799 90.90% 3,921,407 3,583,447 91.38% 5,360,129 4,891,246 91.25% 30 Days 3,774,540 3,268,289 86.59% 8,132,009 7,069,851 86.94% 11,906,549 10,338,140 86.83% > 30 and <90 Days 244,806 223,115 91.14% 453,606 424,351 93.55% 698,412 647,466 92.71% 90 Days 366,867 304,759 83.07% 956,589 821,663 85.90% 1,323,456 1,126,422 85.11% > 90 Days 165,937 153,359 92.42% 155,741 147,466 94.69% 321,678 300,825 93.52% Total 8,252,858 7,374,680 89.36% 18,940,531 17,160,014 90.60% 27,193,389 24,534,694 90.22% 71. As Figure 13 reveals, the prices charged to Cash customers in the Prescription Purchase Data demonstrate that CVS followed its process for setting the retail price as described above for an overwhelming percentage of its Cash prescription purchases. Indeed, 90.22% of Cash prescription purchases occurred at or above the Minimum Retail Price during the relevant period.60 56 February 4, 2016 Deposition of Sevak Melkonian, Tr. 61:22-62:-14; Deposition of Susan Colbert, Tr.193:8-12; July 20, 2016 Deposition of Thomas Morrison, Tr. 109:8-110:4; Deposition of Scott Tierney, Tr. 78:25-79:9. 57 February 4, 2016 Deposition of Sevak Melkonian, Tr. 84:8-24; Exhibit 4. 58 February 4, 2016 Deposition of Sevak Melkonian, Tr. 80:3-11. 59 Deposition of Joel Hay, Exhibit 287: CVSC-0222626. 60 Senior Discount Purchases of $9.89 and $10.79 have been categorized as paid at the Minimum Retail Price. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 26 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. 72. The majority of the remaining 9.78% of Cash prescription purchases which occurred below the Minimum Retail Price fell into two observable groups. One group is comprised of Cash purchases associated with OTC products which are specifically accounted for in the CVS process for setting the retail price. A second group consists of purchases which resulted from the practice of manual price matching or register adjustments; Dr. Hay recognizes that price matching and/or register adjustments may serve legitimate purposes.61 VII. OPINIONS Opinion 1: The HSP program was a small part of CVS's business, most notably its Cash business. 73. In their Complaint, Plaintiffs allege that CVS's HSP program prices should be considered the company's U&C price because "[t]he customers who purchase prescriptions outside of the HSP program and pay the retail price make up less than 50 percent of CVS's cash business and less than three percent of CVS's total business."62 In its Order denying in part CVS's motion to dismiss, the Court stated the following regarding Plaintiffs' theory: "Plaintiffs allege that these U&C prices CVS reported for HSP generics were false because they did not reflect the price paid by the biggest group of cash paying customers: HSP program members."63 The transaction data disprove Plaintiffs' allegations. By any measure, CVS's HSP program was small in size and substantially smaller than the company's other lines of business, including most notably its Cash business. 74. Based on the Prescription Purchase Data, in the context of CVS's overall business, the HSP program was small. First, revenue from HSP purchases, including the annual membership fee, was only 0.89% of CVS's total revenue from all sales of HSP-eligible drugs. Second, of the 873,846,060 purchases of HSP-eligible drugs, only 0.67% or 5,829,242 were purchases under the HSP program as opposed to Third Party, Cash, or Cash Discount purchases. Third, of the 74,488,676 unique CVS customers making the 873,846,060 purchases of HSP-eligible drugs, only 0.69% or 517,479 were ever members of the HSP program. 75. In comparison to CVS's Cash business in particular, the HSP program was the much smaller line of business throughout the relevant period. This is true whether one compares HSP and Cash on the number of purchases, the number of customers, or the amount of revenue. First, HSP purchases 61 Deposition of Joel Hay, Tr. 115:3-116:20. 62 Third Amended Class Action Complaint, Pg. 22:16-18. 63 Order on Motions to Dismiss, Pg. 3:21-23. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 27 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. represented only 17.65% of the combined number of Cash and HSP purchases (i.e., 5,829,242 purchases out of 33,022,631 purchases). Second, customers who were HSP members constituted only 3.75% of the combined number of customers who made Cash purchases, HSP purchases, or both types of purchases (i.e., 517,479 HSP members out of 13,786,771 total customers). Third, revenue generated by HSP purchases, inclusive of amounts attributable to the membership fees, comprised only 15.26% of the combined revenue from Cash and HSP purchases. These numbers are depicted in Figures 14 and 15. Figure 14: Summary of Purchases, Revenue and Customers for Cash and HSP CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 28 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. Figure 15: Yearly Summary of Purchases, Customers, and Revenue as a Percentage of Cash and HSP Combined 2008 2009 2010 2011 2012 2013 2014 2015 Total HSP as a % of Cash and HSP Combined Purchases 8.82% 16.49% 23.13% 21.47% 17.76% 15.44% 14.27% 12.67% 17.65% Customers 6.51% 7.12% 9.76% 8.09% 6.35% 5.28% 5.06% 4.58% 3.75% Revenue 6.71% 12.45% 18.66% 19.59% 16.28% 13.92% 13.26% 11.77% 15.26% Cash as a % of Cash and HSP Combined Purchases 91.18% 83.51% 76.87% 78.53% 82.24% 84.56% 85.73% 87.33% 82.35% Customers 94.30% 94.04% 91.24% 92.66% 94.22% 95.16% 95.27% 95.68% 97.42% Revenue 93.29% 87.55% 81.34% 80.41% 83.72% 86.08% 86.74% 88.23% 84.74% 76. Expressed differently, during the relevant period, CVS's Cash business had over 25 times as many customers, over 4.5 times as many purchases, and over 5.5 times as much revenue as CVS's HSP program. 77. Cash purchases outnumbered HSP purchases in every year of the program and in every one of the eleven states in which Plaintiffs seek to certify a class.64 Figure 16: Summary of Purchases by State of Cash and HSP 64 See Appendix E. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 29 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. Opinion 2: Purchases under CVS's HSP program and CVS's Cash purchases differed in several fundamental respects. 78. Based on my review of the Prescription Purchase Data, I have observed several ways in which HSP program purchases differed fundamentally from CVS's Cash purchases. I explain those differences below. The differences are significant given Plaintiffs are arguing "[t]he U&C price is generally defined as the cash price to the general public,"65 and, by their logic, CVS's HSP program price was the cash price offered to the general public. a) Right to Access a Price Schedule vs. Pricing at CVS's Discretion 79. In the Prescription Purchase Data, the first observable difference is that membership in the HSP program entitled HSP members to a predetermined price for a standard days supply of certain generics (usually 90). But in contrast, a Cash customer is not entitled to a predetermined price and is instead expected to pay CVS's retail price, whatever that price may be on the day of purchase for the given drug at the given quantity.66 80. Most purchases under the HSP program were for HSP-eligible drugs categorized as "Usual Drugs"; in fact, 97.33% of all HSP purchases in the data were for Usual Drugs. In the event the HSP member's prescription for a Usual Drug was for the standard days supply (i.e., 90 day supply), the HSP member's price for that purchase was $9.99 prior to 2011 and $11.99 from 2011 forward. In the data, I observed that HSP members who purchased a Usual Drug for the standard days supply paid at least $9.99/$11.99 in 99.50% of the purchases. 81. By contrast, a CVS Cash customer had no entitlement to pay only $9.99 (pre-2011) or $11.99 (starting in 2011) for the standard day supply of a medication on the HSP formulary. Demonstrating this, I observed that in 78.58% of Cash purchases of the HSP-eligible Usual Drugs at the standard days supply, CVS charged the Cash customer more than the HSP program price. 65 Third Amended Class Action Complaint, Pg. 19:24-26. 66 February 2, 2016 Deposition of Thomas Morrison, Exhibit 83:HSP-CVS-TX-0000056-HSP-CVS-TX-0000060. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 30 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. b) Adjudicated Transaction vs. Non-Adjudicated Transaction 82. A second difference between HSP purchases and Cash purchases is that HSP purchases were adjudicated using a third-party PBM, whereas Cash purchases were not adjudicated by a PBM.67 This difference is observable in the transaction data. 83. There are three fields in the transaction data which accept information returned by the PBM in its transmission response during the adjudication process: RSP_PAT_PYMT_AMT, RSP_SALES_TAX_AMT, and RSP_TOT_PD_AMT. 68 In the transaction data, these three fields are populated with dollar amounts for HSP purchases, Third Party purchases and Cash Discount purchases because those purchases are adjudicated by a third party. Because Cash purchases are not adjudicated by a third party these three fields are not populated with any number but zero, as there is no information from a third party adjudicator to be captured.69 c) Membership Fee vs. No Fee 84. A third difference between HSP purchases and Cash purchases is that HSP members were required to pay an annual membership fee to participate in the program, whereas Cash customers were not required to pay any such premium to purchase prescriptions from CVS. Payment of the membership fee was observable in the transaction data I reviewed; specifically, I observed $9.7 million in annual membership fees in the HSP Prescription Purchase Data. 85. The membership fee is an important factor given the observed differences in the prescription purchases of HSP members and Cash customers. For example, during the relevant period, HSP members on average made approximately five HSP purchases per year at an average cost of $12.53 per purchase for an average annual total of $62.13 per HSP member;70 given this, on average, the annual HSP membership fee represented a 16.79% premium over the average HSP member's annual prescription costs during the relevant period.71 By contrast, on average, CVS Cash customers filled only 1.67 prescriptions per year at an average cost of $16.88 per prescription for an annual total of 67 Deposition of Hilary Dudley, Tr. 235:9-20; Deposition of William Boyd, Tr. 111:5-9. 68 February 26, 2016 Geyerman Transmittal Letter; Deposition of William Boyd, Tr. 42:22-43:16; Ibid, Tr. 89:17- 23. 69 I observed 19 Cash purchases where these three fields have an amount other than zero. 70 Immaterial differences between the annual spend and the product of average prescriptions and average prescription cost are due to rounding. 71 The membership fee premium was estimated for all time periods, including those prior to September 29, 2010 when the membership fee was not contained within the POS field of the Prescription Purchase Data. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 31 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. $28.24. Due to the membership fee, a significant percentage of Cash customers would have paid more to fill their prescriptions had they joined the HSP program. 86. Earlier in my report I explained that across the Cash prescription purchases I analyzed, on average, approximately 78.65% of Cash customers would have been subject to a 61.52% premium on their annual prescription expenses had they joined the HSP program. As demonstrated in Figure 11 and repeated below, relatively similar percentages of Cash customers and premiums were observed in all years with the percentages and premiums generally increasing throughout the relevant period. This is especially noticeable after 2010 when the HSP membership fee was increased from $10 to $15;72 in 2011, a decrease in total HSP members coincided with an increase in both the percentage of Cash customers who would have paid more by joining the HSP program and the premium over their Cash expenditures. Figure 17: Yearly Summary of Customers Who Would Have Paid More by Joining HSP Cash Customers Who Would Pay More by Joining HSP HSP Members Percent Premium HSP Members as All Cash Percent of All HSP Members Year Customers above Cash a Percent of All Customers Cash Customers by Year Expenditures Customers 2008 550,411 335,530 60.96% 49.78% 39,960 0.54% 2009 2,559,776 1,774,547 69.32% 48.91% 206,174 0.92% 2010 2,301,047 1,665,839 72.39% 46.37% 264,226 1.16% 2011 2,169,735 1,802,909 83.09% 63.38% 202,271 0.92% 2012 2,175,566 1,815,301 83.44% 64.05% 156,303 0.67% 2013 2,082,832 1,764,573 84.72% 65.20% 124,060 0.53% 2014 1,804,852 1,501,620 83.20% 70.82% 102,150 0.43% 2015 1,453,709 1,213,819 83.50% 76.20% 80,299 0.34% 87. Due to their prescription filling practices, the additional costs of joining the HSP program would have represented a significant increase to the overall drug expenditures for a large percentage of Cash customers. Given this, the presence of a membership fee is likely to be perceived as an important financial consideration to joining the HSP program. d) 90-Day Supply vs. Any Supply 88. In the data, a fourth observable difference is that the HSP program was predicated on prescription purchases for 90-day supplies of medications, whereas Cash purchases can and do occur at various days supply and most often occur at a days supply below 90 days. 72 Deposition of Susan Colbert, Tr. 169:11-17. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 32 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. 89. In the data, the overwhelming majority of purchases under the HSP program—79.23%—were for a 90-day supply or more. By comparison, only 11.24% of total non-HSP purchases (i.e., Third Party, Cash, and Cash Discount) were for a 90-day supply or more. This difference between the prevalence of 90-day supply purchases depending on the type of purchase is even more pronounced when one considers Cash purchases alone: only 6.05% of Cash purchases were for a 90-day supply or more. 90. Predictably, CVS's HSP program purchases account for a disproportionate amount of all CVS purchases at 90-day supplies. Whereas HSP purchases represent only 0.67% of CVS's total purchases of HSP eligible drugs (i.e. 0.67% of the 873,846,060 total purchases), HSP purchases represent (1) 4.53% of the 90-day purchases across all types of purchases (i.e., Third Party, Cash, Cash Discount, or HSP), and (2) over 77.57% of 90-day purchases when only Cash and HSP purchases are considered. The charts below illustrate, by purchase type, the relative frequency of certain days supply dispensed to HSP members and non-HSP customers. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 33 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. Figure 18: Distribution of Prescription Purchases by Days Supply – HSP, Cash and Third Party Figure 19: Distribution of Prescription Purchases by Days Supply – HSP and Cash Only CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 34 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. 91. Because 90-day-supply purchases occur disproportionately more in HSP purchases as compared to Cash purchases by a factor of 3.46, Dr. Hay's method for determining what supposedly constitutes CVS's "most common cash price" is misleading.73 As explained above, the total produced data consist of 873,846,060 unique prescription purchases; 33,022,631 of those purchases are Cash or HSP purchases. Drawing upon a subset of the 33,022,631 purchases, Dr. Hay calculates what he calls a "most common cash price," which price thereafter serves as the starting point for his recalculated U&C applied to all prescription purchases that potentially qualify for the class. However, the subset Dr. Hay has chosen is limited to purchases of a 90-day supply only; the subset consists of only 5,838,418 purchases, of which 4,531,452 are HSP purchases.74 By limiting his analysis to this narrow subgroup of purchases, Dr. Hay's method essentially ensures that the HSP program price will be selected as the "most common cash price." In this way, Dr. Hay can say "the HSP prices of $11.99 and $9.99 are greater than 44 times and 52 times more common than the second most common prices," even though HSP purchases represent only 0.67% of all CVS's purchases for HSP-eligible drugs and, more importantly, only 17.65% of purchases if the relevant universe is all Cash and HSP purchases together.75 e) 90-Day-Based Minimum Price vs. Minimum Price Not Based on a Specific Quantity 92. A fifth difference between HSP purchases and Cash purchases, which is related to the fourth difference, is that HSP purchases were subject to a minimum purchase price based on a standard 90- day quantity – the presumptive quantity in an HSP purchase. In Cash purchases, however, CVS does not impose a minimum purchase price that is set based on any particular presumed quantity. 93. The Prescription Purchase Data demonstrate that CVS pharmacies adhered to the HSP program requirement that HSP members be charged the standard HSP price even if the member purchased less than a 90-day supply of the medication. In other words, the data demonstrate that CVS pharmacists did not "prorate" the HSP price for an HSP member when a quantity below the 90-day supply was dispensed. 94. For the HSP-eligible drugs categorized as "Usual Drugs", which constituted 97.33% of all HSP purchases, I calculated that 99.50% of the 90-day prescriptions were charged at the expected HSP 73 Declaration of Joel Hay, Pg. 11:3-4 and Table 3. 74 I understand Dr. Hay's calculation to be limited to 90-day "Usual Drugs." The figure cited is developed from my review of the Prescription Purchase Data. 75 Declaration of Joel Hay, Pg. 11:4-6. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 35 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. price and not below that price. Furthermore, of the 1,205,295 HSP purchases across all Drug Categories in which the customer filled less than the standard HSP days supply, I calculated that 1,198,751 (99.46%) of the purchases were charged the expected HSP price and not below that price. 95. Of the remaining 0.54% of HSP purchases, where the price charged at the point of sale was less than the standard HSP price, only 16 purchases were at a quantity and price potentially suggestive of proration: there were thirteen 30-day purchases where the customer was charged $3.33 or $3.99, and only three 60-day purchases where the customer was charged $6.66 or $7.98.76 By way of context, these 16 purchases are a subset of the 5,829,242 HSP purchases made during the program's seven- plus-year life across the 11 states. If we assume all 16 purchases reflect proration of the HSP program price, the incidence rate of proration across all HSP purchases was 0.0001%. 96. In conflict with my observations, Dr. Hay states "it was a common occurrence for CVS to offer prorated prices based on the HSP price"77 Dr. Hay identifies 2,509,883 Cash or HSP purchases where the amount collected from the customer was below the standard HSP price.78 Setting aside that these approximately 2.5 million purchases represent only 7.60% of all Cash and HSP purchases during the relevant time period, only 6,637 (0.26%) are HSP purchases. These 6,637 purchases, in turn, represent just 0.60% of all HSP purchases with less than a 90 day supply. Thus, even Dr. Hay's analysis demonstrates that CVS charged at least the standard HSP price for 99.40% of HSP purchases involving less than the standard 90-day supply. The exceptions translate to just over one prescription per store during the relevant seven-plus-year period.79 97. CVS's policy to charge the standard HSP price, even if the purchase involved less than the standard days supply, has implications for individuals claiming damages in this case. Take HSP purchases of Usual Drugs which comprised 97.33% of all HSP purchases. Because the HSP price on these purchases was a minimum price of $9.99/$11.99, the HSP program price would not have been less expensive than an insurance copayment that was already at or below $9.99 prior to 2011, or at or below $11.99 starting in 2011. And this is to say nothing of the annual membership fee a person 76 The most prevalent other price point was $4, which accounted for the overwhelming majority of the exceptions. 77 Declaration of Joel Hay, Pg. 12:5-6. 78 Declaration of Joel Hay, Pg. 12-Table 4. 79 Additionally, analysis of the remaining 2,503,246 Cash purchases (not HSP) included in Dr. Hay's Table 4 shows that where CVS pharmacies sold to a Cash customer below the HSP standard price, it generally was not due to price proration below the standard HSP days supply. First, a senior discount of ten percent was applied to 574,052 (22.93%) of the remaining purchases. CVS's CHRGD_UC_PRC_AMT field reflects this discount. See Appendix A. CVS pharmacies discounted an additional 687,003 purchases (27.44%) for a single product, Magnesium Oxide, during the relevant period. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 36 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. needed to pay to receive the benefit of the HSP price. This issue is relevant to both the named Plaintiffs and to the putative class. 98. Regarding the named Plaintiffs, based on my review of spreadsheets containing purchases made at a CVS pharmacy by the named Plaintiffs in this case, eight of the 15 named plaintiffs—Avis (AZ), Brown (TX), Caine (GA), Corcoran (CA), Gilbert (TX), Hagert (PA), Odorisio (NY), and Wulff (OH)—did not have a single Third Party purchase on which their copay was greater than the standard HSP price.80 99. Regarding the putative class, the overwhelming majority of potential class members identified by Dr. Hay in his Supplemental Declaration paid copayments that were less than the standard HSP price. Specifically, 74.13% of the 266,820,879 purchases identified by Dr. Hay as being "[a]ffected" by CVS's U&C pricing, and thereby contributing to his damages calculation, involved a customer paying a copayment less than the standard HSP price for the dispensed medication. Attached as Appendix F is a list of the Condor Codes and Condor Plan Names in the 266,820,879 transactions identified by Dr. Hay as contributing to damages. 100. While HSP members who made an HSP purchase for quantities below a 90-day supply paid the standard HSP price, a Cash customer purchasing a 90-day prescription usually paid less, for example, for a 30-day prescription or a 60-day prescription than he or she did on a 90-day Cash purchase. f) Limited Formulary vs. Open Formulary 101. A sixth difference between the HSP program and Cash purchases involves the scope of the available medications. The HSP program's formulary was limited to a subset of GCNs sold by CVS. As described above, the HSP purchases I have analyzed consisted of drugs within only 463 GCNs. By contrast, a Cash customer is able to purchase any medication offered by the CVS pharmacy. 80 From Plaintiff's interrogatory responses which identified alleged overpayments, I identified the prescription detail within Excel files produced by CVS in this matter. I was advised the spreadsheets are the company's records of the named Plaintiffs' prescription purchases from CVS. My observations about the named Plaintiffs and their underlying purchases were generally inconsistent with Dr. Hay's conclusions. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 37 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. Opinion 3: Inconsistencies with Plaintiffs' Exhibit 12 impugn the reliability of Dr. Hay's damages calculation. 102. Exhibit 12 to Plaintiffs' Motion for Class Certification is described as a "list of qualifying contracts."81 Dr. Hay's understanding is that Exhibit 12 is a set of contracts that would fit the class definition.82 In that regard, Dr. Hay's use of Exhibit 12 calls into question the reliability of his ultimate damages calculation. 103. However, the original Condor Codes assigned to the terminated Aetna-CVS agreement remained in use. The terminated contract contained a definition of the U&C price applicable only to those prescriptions purchased before that contract terminated.85 I understand Dr. Hay followed this approach when mapping contractual U&C definitions to prescription purchases in the data, thereby introducing uncertainty as to the reliability of his damages calculation.86 81 Plaintiffs' Motion for Class Certification, Pg. iii. 82 Deposition of Joel Hay, Tr. 164:6-165:21. 83 Declaration of Susan Colbert, ¶13. 84 Ibid., ¶13. 85 Ibid., ¶13. 86 Deposition of Joel Hay, Tr. 162:14-163:3. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 38 7 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. 106. Opinion 4: The lack of information important to assessing the impact of a change to the submitted U&C on the patient's copayment amount implicates the reliability of Dr. Hay's damages calculation. 107. In his Supplemental Declaration, Dr. Hay calculated damages totaling $1,218,544,287 across 266,820,879 Third Party Payer prescription purchases.95 Dr. Hay calculated these damages by comparing "the actual copayments to recalculated HSP-Based U&C prices. The difference was the amount of the overcharge."96 In this way, Dr. Hay's damages calculation consists of two components: the patient's actual copayment amount and Dr. Hay's recalculated HSP-based U&C price. With respect to the former, the lack of certain important information raises questions about the reliability of Dr. Hay's damages calculation. Perhaps because of the missing information, Dr. Hay has not opined that but for CVS's allegedly inflated U&C price, any individual insured customer's outlay of copayments during the benefit period, or even an individual purchase, would have been any lower than they were in the normal course. 108. First, Dr. Hay does not have details of the cost-sharing responsibilities for each individual patient as defined by their respective benefit plan. This would include, for example, whether the patient had a deductible, the amount of the deductible, or the amount of the deductible met as of each date of service. Nor does Dr. Hay have information about potential deductible exemptions. Dr. Hay does not possess information as to whether the patient had a maximum out-of-pocket limit on their cost-sharing responsibilities or the patient's position relative to that limit on a given date of service.97 Nor does Dr. Hay know whether the patient was entitled to reimbursement for his or her copayments advanced to the pharmacy. 94 Declaration of Susan Colbert, ¶ 18. 95 Supplemental Declaration of Joel Hay, Pg. 4 - Table 2. 96 Supplemental Declaration of Joel Hay, Pg. 15:19-20. 97 Deposition of Joel Hay, Tr. 289:5-16. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 40 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. 109. Second, the prescription purchases for a given patient in the Prescription Purchase Data may not represent a complete record of all benefit claims during a given benefit period. Dr. Hay may not even have a complete record of all prescription benefit claims for a given patient in the event that a patient filled prescriptions at non-CVS pharmacies, filled non-HSP eligible prescriptions at a CVS pharmacy, and/or filled prescriptions outside one of the 11 jurisdictions identified above. 110. Third, Dr. Hay does not possess the adjudication logic used by the PBM or the TPP to calculate the amount of costs for which each patient was responsible at the time a claim subject to damages was originally filled, or the adjudication logic the PBM or TPP would use to re-adjudicate the patient responsibility amount should there be an adjustment to that claim.98 Although a number of CVS's contracts with PBMs and TPPs have been produced in the litigation, the contracts I reviewed do not specify adjudication logic regarding how an individual insured's copayment is calculated. This omission is unsurprising: the benefit design (which drives the copayment amount) is a matter known to the TPP and its insured, as managed and implemented by the PBM, and not something that would necessarily be known by the pharmacy.99 Opinion 5: Dr. Hay relies upon his recalculated HSP-based U&C prices to calculate damages; because his methodology for recalculating his HSP-based U&Cs suffers from multiple flaws, his calculation of damages is not reliable. 111. I previously stated that Dr. Hay's damages calculation consists of two components: the patient's actual copayment amount and Dr. Hay's recalculated HSP-based U&C price. With respect to the latter, methodological flaws in Dr. Hay's recalculated HSP-based U&C prices impugn the reliability of his damages calculation. a) Dr. Hay's decision to prorate HSP prices when recalculating his HSP-based U&C is contrary to the evidence; CVS did not prorate its standard HSP prices for quantities less than the standard HSP Days Supply. 112. True to his description, Dr. Hay begins the construction of his HSP-based U&Cs with the HSP prices and the standard HSP days supply; interestingly, he uses the HSP prices and days supply despite the fact that HSP purchases represent only 0.67% of all forms of purchases of HSP eligible drugs during the relevant period (e.g., Third Party, Cash), and only 17.65% of such purchases when 98 Declaration of John Jones, ¶¶26-27; Declaration of Edward McGinley, ¶18. 99 Declaration of John Jones, ¶¶26-27. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 41 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. only Cash and HSP are considered. However, Dr. Hay quickly breaks down the HSP prices— specifically, Dr. Hay divides the standard HSP price (e.g., $9.99) by the standard HSP days supply (e.g., 90 days), and then multiplies the result ($0.11) by the days supply on each Third Party prescription (e.g., 30 days supply) to achieve his recalculated HSP-based U&C price used to calculate damages for that prescription. So, in this example, Dr. Hay would find a recalculated HSP-based U&C price of $3.33 for 30-day prescriptions.100 In other words, Dr. Hay prorates down the standard HSP price to achieve his recalculated HSP-based U&C price – a price which is considerably less than the standard HSP price from which he starts his analysis. 113. In direct conflict with Dr. Hay's approach, the Prescription Purchase Data – and Dr. Hay's own analysis – reveal that HSP prices were not prorated down. See Paragraph 96 above. 114. Dr. Hay's assumption that HSP prices were prorated downward when the Prescription Purchases Data shows they were not, increases Dr. Hay's damages calculation. A significant percentage of Third Party purchases on which Dr. Hay calculates damages – 92.58% – were for a 30-day supply or less. The patient copayments on these shorter days-supply purchases tend to be lower. Indeed, 74.13% of the 266,820,879 purchases identified by Dr. Hay as being "[a]ffected" by CVS's U&C pricing, and thereby added to his damages calculation, involved a customer paying a copayment less than the standard HSP price for the dispensed medication.101 Therefore, in order to achieve a recalculated U&C price that is sufficiently low to generate damages, Dr. Hay has constructed a flawed methodology recalculating an HSP-based U&C price that ignores the fact that HSP prices were not prorated downward. 115. Below I quantify the effect of removing these 74.13% of purchases from Dr. Hay's calculation of damages, as well as to account for the fact that HSP prices were not prorated downward. b) 116. 100 In this example, and in Dr. Hay's analysis, the HSP-based U&C is calculated at the level of a GCN, days supply, and for specific time periods (e.g., Pre and Post January 1, 2011 for GCNs within the Usual Drug category). 101 Supplemental Declaration of Joel Hay, Pg. 4-Table 2. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 42 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. 117. 102 Figure 20 is a copy of Figure 13. Also, see paragraph 72. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 43 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. c) By ignoring the fact that CVS did not prorate its HSP prices downward, and by ignoring CVS's process for determining the retail price, Dr. Hay achieves an HSP-based U&C price which is rarely paid, if it is ever paid. 119. In his Declaration, Dr. Hay states that "for a pharmacy to submit U&C prices to TPPs and PBMs that are not routinely paid by cash customers, much less paid at all, is contrary to the industry standard of a U&C price and the concept of the U&C fee screen."103 Given this statement by Dr. Hay, I compared Dr. Hay's recalculated HSP-based U&C prices to the prices paid by Cash customers in the Prescription Purchase Data. I was interested in investigating the extent to which the recalculated HSP-based U&C prices appeared as prices paid by Cash customers. The results of my comparison highlight a core methodological flaw in Dr. Hay's recalculated U&C prices (and by extension, his calculation of damages): his recalculated HSP-based U&C prices were rarely, if ever, paid by CVS's Cash customers. 120. I compared the recalculated HSP-based U&C price used by Dr. Hay to each and every price charged to a Cash customer for the same GCN and days supply. I then measured the amount of damages Dr. Hay calculated using an HSP-based U&C price that was also paid by a Cash customer. I 103 Declaration of Joel Hay, Pg. 10:20-22. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 44 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. also examined the frequency with which Cash customers paid each HSP-based U&C price used to calculate damages.104 121. I found that Dr. Hay calculated over $358 million in damages from purchases where the HSP- based U&C price was not paid by a Cash customer for that GCN and days supply. Similarly, I found that Dr. Hay calculated over $800 million in damages from purchases where the HSP-based U&C price was paid in less than 1% of Cash purchases for that same GCN and days supply. And I found that Dr. Hay calculated over $1.07 billion in damages from purchases where the HSP-based U&C price was paid in less than 5% of Cash purchases for that same GCN and days supply. Insofar as Dr. Hay stands by the point he espoused – that a price "not routinely paid by cash customers, much less paid at all, is contrary to the industry standard of a U&C price" – then his own HSP-based U&C prices are intrinsically flawed and contrary to industry standards. Opinion 6: Dr. Hay's calculation of damages is significantly reduced if his damages calculation is adjusted to account for the fact that HSP prices were not prorated downward. 122. If Dr. Hay's damages methodology is adjusted simply to account for the fact that HSP prices were not prorated downward, the result of his damages calculation is $257,091,890. This result reflects the difference between the copay actually paid (i.e., the POS paid by TPP members) and the standard HSP price, unless the days supply is greater than the standard HSP days supply; in that case, the HSP price is prorated upward. Upward proration of the standard HSP price for a days supply that exceeds the standard HSP days supply is consistent with Dr. Hay's original calculation in which he, too, prorated upward the HSP price, as well as with my review of CVS testimony, documents describing the HSP program, and the transactional data. Figure 22 shows the results of Dr. Hay's damages calculation, adjusted for the fact that HSP prices were not prorated downward, by each state for which Plaintiffs are attempting to certify a class. 104 My comparison of Dr. Hay's recalculated HSP-based U&C prices to prices charged to Cash customers followed the time periods Dr. Hay established for his HSP-based U&C price calculations. For example, I compared the HSP- based U&C price Dr. Hay calculated prior to January 1, 2011 for GCNs within the Usual Drug category to Cash prescription purchases with a service date prior to January 1, 2011 for those same GCNs. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 45 7 December 9, 2016 Expert Report of Brett E. Barlag on Behalf of CVS Pharmacy, Inc. Figure 22: Results of Dr. Hay's Damages Calculation Adjusted for the Fact that HSP Prices were not Prorated Down State Purchases Damages Arizona 1,854,957 $ 7,386,493 California 11,996,791 $ 35,108,213 Florida 8,059,937 $ 31,890,248 Georgia 4,626,766 $ 20,901,605 Illinois 3,404,009 $ 14,435,106 Massachusetts 8,071,845 $ 28,025,650 New Jersey 4,445,937 $ 23,294,086 New York 6,492,065 $ 24,755,899 Ohio 4,379,590 $ 17,989,710 Pennsylvania 4,757,711 $ 18,921,314 Texas 9,116,218 $ 34,383,565 Total 67,205,826 $ 257,091,890 Opinion 7: Dr. Hay's calculation of damages is significantly reduced if his damages calculation is adjusted to account for statements made regarding CVS's HSP program in Declarations and deposition testimony taken from PBMs which processed the most claims during the relevant period. 123. According to CVS's Opposition to Motion for Class Certification, "the largest PBMs, which controlled more than 75% of the market (i) knew about HSP during the program's existence, (ii) did not believe that the HSP price should have been treated as the U&C price, and (iii) did not expect CVS to submit the HSP price as the U&C price."105 CVS obtained declarations or deposition testimony from Express Scripts, Caremark, OptumRx, Medco, and MedImpact stating that the HSP program, and other programs with characteristics similar to the HSP program, were not considered "discounts" as defined within each PBM's definition of U&C.106 In other words, each of these PBMs stated that its U&C definition did not intend to include HSP program purchases or pricing. As stated by Dr. Hay in deposition testimony, he would consider modifying his damages calculation for contracts such as these which do not fit the class definition.107 124. Accordingly, I attempted to quantify the amount of Dr. Hay's damages attributed to prescription purchases where one of these five PBMs served as the processor in adjudicating purchase. 105 CVS Pharmacy, Inc.'s Opposition to Motion for Class Certification, Pg. 1:26-2:3. 106 CVS Pharmacy, Inc.'s Opposition to Motion for Class Certification, Pg. 10: 2-12:7. 107 Deposition of Joel Hay, Tr. 220:13-222:16. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 46 7 7 DECEMBER 9, 2016 REPORT OF BRETT E. BARLAG ON BEHALF OF CVS PHARMACY, INC. 1 Deposition of William Boyd Tr. 29:8-12. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 7 2 Deposition of Hilary Dudley Tr. 80:18 – 22. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 7 Appendix B BRETT E. BARLAG ACADEMIC BACKGROUND: University of Notre Dame, 1997 B.A., cum laude Columbia Business School, 2004 M.B.A. PROFESSIONAL AFFILIATIONS: Association of Certified Fraud Examiners, Associate Member Healthcare Financial Management Association, Member EMPLOYMENT: October 2012 – Present: Senior Managing Director, Health Solutions FTI Consulting, Inc. September 2011 – August 2012: Chief Financial Officer and Chief Strategy Officer Maxim Healthcare Services, Inc. July 2004 – September 2011: Senior Managing Director, Forensic & Litigation Consulting FTI Consulting, Inc. May 2002 – December 2002: Manager, KPMG, LLP September 1997 – May 2002: Manager (final position), Arthur Andersen LLP EXPERT TESTIMONY – LAST FOUR YEARS: Karsten Schuh, Individually and on Behalf of All Others Similarly Situated v. HCA Holdings, Inc. et al. United States District Court Middle District of Tennessee, Nashville Division. Civil Action No. 3:11- CV-01033 (Expert Report and Deposition Testimony on behalf of HCA Holdings, Inc. et al.) United States of America ex rel. Debora Paradies, London Lewis and Roberta Manley and United States of America, v. GGNSC Administrative Services, LLC, et al. United States District Court Northern District of Alabama Southern Division. Civil Action No: 2:12-cv-00245-KOB (Expert Report and Deposition Testimony on behalf of GGNSC Administrative Services, LLC, et al.) 7 Appendix B The People of the State of Illinois, v. Abbott Laboratories, et al. In the Circuit Court of Cook County, Illinois County Department, Chancery Division. Case No. 05 CH 2474 (Expert Report and Deposition Testimony on behalf of Abbott Laboratories) PRESENTATIONS AND PUBLICATIONS – LAST TEN YEARS: "What is an effective Compliance Program?" What do Florida Lawyers and Compliance Officers Need to Know About Health Care Regulatory and Compliance Issues? Florida Bar Health Care Regulatory and Compliance CLE, November 1, 2013, Orlando, Florida. AWP: Past, Present and Future, CBI 11th Annual Medicaid Rebates Conference, May 20, 2009, Orlando, Florida. Formulating a Game Plan for Preventing and Responding to a State, Federal, or Congressional Subpoena, ACI's Fraud & Abuse of Medical Devices, November 12, 2007, Chicago, Illinois. Formulating a Game Plan for Preventing and Responding to a State, Federal, or Congressional Subpoena, 5th National Conference on Avoiding Regulatory Scrutiny in the Sales and Marketing of Medical Devices, November 29, 2006, Chicago, Illinois. AWP (Average Wholesale Price) and WAC (Wholesale Acquisition Cost): What You Need To Know, American Conference Institute's RX Drug Pricing Boot camp, May 17, 2007, San Francisco, California. AWP (Average Wholesale Price) and WAC (Wholesale Acquisition Cost): What You Need To Know, American Conference Institute's RX Drug Pricing Boot camp; November 16, 2006; New York, New York. RELEVANT PROFESSIONAL EXPERIENCE: • Karsten Schuh, Individually and on Behalf of All Others Similarly Situated v. HCA Holdings, Inc. et al.: Submitted expert report and provided deposition testimony on behalf of defendant in securities class action litigation alleging failure to disclose material financial information in advance of the defendant's 2011 initial public offering. The scope of issues included financial data analysis of certain of defendant's service lines, the impact of volume changes on the defendant's financial results, and management's use of and response to results of internal audits. • United States of America v. GGNSC Administrative Services (doing business as Aseracare Hospice): Submitted expert report and provided deposition testimony on behalf of defendant related to Medicare reimbursement of Hospice care, the Medicare Cap on hospice payments, healthcare compliance programs, compensation programs within healthcare organizations, and healthcare marketing programs. 2 7 Appendix B • People of the State of Illinois v. Abbott Laboratories, Inc. et al.: Submitted expert report and provided expert testimony on behalf of manufacturer defendant - provided deposition testimony related to analysis of pharmaceutical pricing and alleged inflation of drug Average Wholesale Prices ("AWP"). • Assisted a national retail pharmacy with an internal investigation and self-disclosure of overpayments related to generic drug substitution practices. Designed a complex reimbursement model analyzing millions of claims across dozens of Medicaid programs to quantify the magnitude of the overpayments and support the company's disclosure, and developed and implemented a series of system and internal audit improvements to prevent recurrence of the drug substitution issues. • Assisted a retail pharmacy chain with whistleblower cases related to a subset of its promotional discount card programs and allegations that these programs drove overutilization and over-reimbursement among government insured customers. The matter included alleged violations of the Anti-Kickback Statute as well as potential penalties under the anti-inducement provision of the Civil Monetary Penalties Law. • Assisted a retail pharmacy chain with an investigation and settlement with the government on allegations related to dual-eligibles and coordination of benefit issues. • Assisted multiple pharmacy companies with government investigations into alleged non- compliance with Drug Utilization Review ("DUR") and state Medicaid reimbursement regulations related to medical diagnosis requirements. • Assisted a pharmacy company with a government investigation into alleged adulteration and overutilization of physician administered drugs. At issue were claims that the named parties were engaged in a scheme to harvest additional vials of the subject drugs through a pre-fill syringe program. Analysis included modeling the potential impact of the allegations on Medicare and other government payer reimbursements. • Assisted pharmacy company with investigation into alleged non-compliance with state Medicaid regulations regarding automatic prescription refilling of patient prescriptions. • Assisted patient assistance fund with investigation into its processes, policies, and procedures for determining the amount of co-payment/co-insurance assistance to be provided to patient applicants. • Assisted long-term care pharmacy company with a post-acquisition valuation dispute. • Assisted global drug and medical supply distributor with analysis of its sell side contracting and pricing strategies in an effort to optimize margins and enhance compliance with contract terms by its customers. Developed complex financial data models which 3 7 Appendix B analyzed customer compliance with an array of contractual terms and conditions across hundreds of contracts and identified margin improvement opportunities as a result of enforcing customer compliance with contract requirements. • Conducted and resolved Best Price investigations for pharmaceutical companies and their counsel. • In Re: Pharmaceutical Industry Average Wholesale Price Litigation, M.D.L. No. 1456: Assisted multiple defendants as non-testifying consultants, supporting transactional data collection and production, complex data analysis and damage modeling, industry subject matter expertise and overall strategic advisement on case issues. • Assisted multiple defendants named separately in state Average Wholesale Pricing (AWP) cases brought by Attorneys General on behalf of the Medicaid programs in several jurisdictions including, but not limited to, Alabama, Illinois, New York, Wisconsin, South Carolina, Kentucky, Massachusetts, California, Texas, Ohio, Hawaii, Alaska, Mississippi, Idaho, Montana and Nevada. • Assisted pharmaceutical manufacturer with review of its internal processes, policies, and procedures related to drug price setting. • Assisted as the Independent Review Organization, required under a signed Corporate Integrity Agreement with the Office of the Inspector General, for two pharmaceutical companies. • Assisted several pharmaceutical manufacturers with concerns related to their sales and marketing practices and government qui tam investigations related to product pricing. • Assisted global wholesaler of drug and medical supplies with the overhaul of its drug diversion monitoring program. In addition to assisting with process and policy enhancements, developed and applied statistical data algorithms to the company's SAP transactional data system in order to improve the company's ability to identify outlier orders, aberrant ordering patterns, and unusual ordering frequency. • Investigated SEC allegations against a specialty Pharmaceutical company related to revenue recognition concerns. Worked with the Company's outside counsel and audit committee to investigate the allegations, test and model the SEC's theories utilizing the Company's transactional data and financial accounting systems, and report the findings to the company's audit committee, board, and the SEC. • Assisted multiple suppliers and distributors of controlled substances with government investigations related to alleged non-compliance with DEA regulations related to the monitoring and reporting of controlled substance orders. 4 7 Appendix B • Assisted the fiscal agent and primary information technology provider to a state Medicaid program with an internal investigation into allegations that medical claims were not being processed in accordance with program regulations. Review adjudication logic within the claims processing system and tested paid claims against the applicable payer rules to identify potential processing and payment errors. • Assisted healthcare technology company with investigation into alleged non-compliance with Meaningful Use Electronic Health Record certification requirements. • Assisted a post-acute care provider with a company-wide restructuring and enhancement of its regulatory processes, controls, and systems. The scope of these efforts included functions within the company's Compliance, Clinical, Finance, Human Resources, and IS departments. Experience included redesigning aspects of its employee compensation programs; redesigning its core compliance training curriculum; leading the revision and rewrite of its core policies and procedures; leading the development of a business intelligence data warehouse and reporting solution; leading the development of applications and databases to enhance its auditing and monitoring capabilities; and monitoring the effectiveness of its compliance program. • Assisted a hospital system with its settlement of outstanding claims with the Healthcare Financing Administration, or HCFA. These claims stemmed from the DOJ's investigation of alleged Medicare billing fraud spanning multiple years. Performed extensive data analysis and data modeling of Medicare cost reports, cost report adjustments, and Medicare appeals. Developed detailed settlement methodologies presented jointly to HCFA and DOJ. • Assisted a medical device company with multiple internal investigations into its promotional and pricing functions. The underlying issues included concerns related to the prevalence of payments and discounts to physicians to induce switching from competing modalities. • Assisted a medical device company with a government investigation into its sales and marketing and discounting practices. The allegations were that the company contributed to overbilling of the Medicare program by counseling physicians to submit certain free goods and other nominally priced items for reimbursement. • Developed and implemented compliance review work plans for use in an internal investigation aimed at evaluating potential at risk sales and marketing practices for a medical device company, with a special emphasis on forensic technologies and data centric risk assessment techniques. • Assisted an international healthcare government contractor with an internal fraud investigation related to expense reimbursements. Developed a statistical, risk-based approach that evaluated trends and patterns across millions of dollars in reimbursements 5 7 Appendix B over several years to pinpoint individual schemes and flag individual perpetrators of those schemes. Developed a series of compliance recommendations and testing to reduce recurrence. • Served as Chief Financial Officer and Chief Strategy Office of a diversified healthcare services company providing homecare, clinical staffing, wellness, immunization, and wellness services to government, commercial, and self-insured consumers nationwide. Responsibilities included leading the company's Financial, Accounting, Reimbursement, Payroll, Strategy, and Government Affairs functions. CONTACT INFORMATION: Brett E. Barlag Senior Managing Director FTI Consulting, Inc. 1101 K Street, NW Suite B100 Washington D.C., 20005 ph: (202) 312-9183 email: brett.barlag@fticonsulting.com 6 7 DECEMBER 9, 2016 REPORT OF BRETT E. BARLAG ON BEHALF OF CVS PHARMACY, INC. Appendix C: List of Materials Considered Depositions and Deposition Exhibits Deposition of Thomas J. Gibbons dated September 30, 2014 Deposition of Thomas E. Morrison dated February 2, 2016 and Corresponding Exhibits Deposition of Sevak Y. Melkonian dated February 4, 2016 and Corresponding Exhibits Deposition of Thomas E. Morrison dated July 20, 2016 and Corresponding Exhibits Deposition of Sevak Y. Melkonian dated July 21, 2016 and Corresponding Exhibits Deposition of William Boyd dated September 9, 2016 and Corresponding Exhibits Deposition of Scott Tierney dated September 13, 2016 and Corresponding Exhibits Deposition of Hilary Dudley dated September 20, 2016 and Corresponding Exhibits Deposition of Susan F. Colbert dated October 6, 2016 Deposition of Joel Hay dated November 9, 2016 and Corresponding Exhibits Deposition of William John Barre dated November 17, 2016 and Corresponding Exhibits Electronic Data DCVS - 00000000001 through DCVS - 00936214895: - 26 state specific data files and two supplemental Coordination of Benefits data files containing 936,214,895 records associated with HSP-eligible drugs only. Supplemental Information 2016.10.16 - Watts to Barlag enclosing NDC lists Geymeran Letter Attaching List of Inadvertently Added NDCs dated October 10, 2016 G. Geyerman to R. Gilmore re Production dated April 15, 2016 G. Geyerman to R. Gilmore enclosing supplement to data prods of 2.5 and 2.26.2016 dated April 15, 2016 Geyerman Ltr. to Gilmore re Supp. Data Production dated February 26, 2016 Named Plaintiff RXC Patient IDs Plaintiffs At Issue Transactions.xlsx NDC lists and At-Issue Transactions Letter to Brett Barlag, dated November 7, 2016 PLFS QLFYING TRX.xlsx Letter to Brett Barlarg enclosing thumb drives dated October 17, 2016 2009.02.12 - Chart of U&C Definitions.pdf CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 7 DECEMBER 9, 2016 REPORT OF BRETT E. BARLAG ON BEHALF OF CVS PHARMACY, INC. Appendix C: List of Materials Considered Plaintiff's Expert Declarations and Supporting Data Declaration of Joel W Hay, PhD and supporting data - October 3, 2016 Supplemental Declaration of Joel W Hay, PhD and supporting data - November 11, 2016 Legal Filings Plaintiffs' Motion for Class Certification and associated Exhibits; October 3, 2016 CVS Pharmacy Inc 's Opposition to Motion for Class Certification and associated Exhibits; November 21, 2016 Second Amended Class Action Complaint; November 3, 2015 Defendant CVS Health Corporation's Notice of Motion and Motion to Dismiss; Memorandum of Points & Authorites in Support Thereof; December 4, 2015 Plaintiffs' Opposition to CVS Health Corporation's Motion to Dismiss; January 15, 2016 CVS Pharmacy, Inc 's Reply in Support of Motion to Dismiss; February 12, 2016 Order on Motions to Dismiss; Motion to Appoint Interim Class Counsel; Motion to Transfer; March 14, 2016 Third Amended Class Action Complaint; April 4, 2016 CVS Pharmacy, Inc 's Notice of Motion and Motion to Dismiss; Memorandum of Points and Authorities in Support Thereof; April 18, 2016 Plaintiffs' Opposition to CVS Pharmacy, Inc Motion to Dismiss; May 2, 2016 CVS Pharmacy, Inc 's Reply In Support Of Motion to Dismiss; May 9, 2016 PLAINTIFF CAROLYN CAINE'S AMENDED RESPONSESAND OBJECTIONS TO DEFENDANT'S INTERROGATORIES - July 22, 2016 PLAINTIFF ROBERT JENKS'S AMENDED RESPONSES AND OBJECTIONS TO DEFENDANT'S INTERROGATORIES - July 22, 2016 PLAINTIFF ZULEMA AVIS'S AMENDED RESPONSES AND OBJECTIONS TO DEFENDANT'S INTERROGATORIES - August 1, 2016 PLAINTIFF DR ROBERT GARBER'S AMENDED RESPONSES AND OBJECTIONS TO DEFENDANT'S INTERROGATORIES - August 1, 2016 PLAINTIFF TONI ODORISIO'S AMENDED RESPONSES AND OBJECTIONS TO DEFENDANT'S INTERROGATORIES - August 1, 2016 PLAINTIFF WALTER WULFF'S AMENDED RESPONSES AND OBJECTIONS TO DEFENDANT'S INTERROGATORIES - August 1, 2016 PLAlNTIFF ZACHARY HAGERT'S AMENDED RESPONSESAND OBJECTIONS TO DEFENDANT'S INTERROGATORIES - August 5, 2016 PLAINTIFF ONNOLEE SAMUELSON'S THIRD AMENDED RESPONSES AND OBJECTIONS TO DEFENDANT'S INTERROGATORIES - August 17, 2016 PLAINTIFF CARL WASHINGTON'S AMENDED RESPONSES AND OBJECTIONS TO DEFENDANT'S INTERROGATORIES - August 23, 2016 PLAINTIFF AMANDA GILBERT'S AMENDED RESPONSES AND OBJECTIONS TO DEFENDANT'S INTERROGATORIES - August 25, 2016 PLAINTIFF VINCENT GARGIULO'S SECOND AMENDED RESPONSES AND OBJECTIONS TO DEFENDANT'S INTERROGATORIES - August 27, 2016 PLAINTIFF DEBBIE BARRET'S SECOND AMENDED RESPONSES AND OBJECTIONS TO DEFENDANT'S INTERROGATORIES - September 13, 2016 PLAINTIFF GILBERT BROWN'S RESPONSES AND OBJECTIONS TO DEFENDANT'S INTERROGATORIES - October 5, 2016 PLAINTIFF TYLER CLARK'S SUPPLEMENTAL AND AMENDED RESPONSES AND OBJECTIONS TO DEFENDANT'S INTERROGATORIES - October 6, 2016 PLAINTIFF CHRISTOPHER CORCORAN'S SUPPLEMENTAL AND AMENDED RESPONSES AND OBJECTIONS TO DEFENDANT'S INTERROGATORIES - November 2, 2016 Public Sources https://www cms gov/Research-Statistics-Data-and-Systems/Research/HealthCareFinancingReview/downloads/04springpg25 pdf http://www fda gov/Drugs/ResourcesForYou/Consumers/BuyingUsingMedicineSafely/UnderstandingGenericDrugs/ucm305896 htm http://www fda gov/Drugs/developmentapprovalprocess/UCM070829 CVS Annual Reports CVS Health, 2015 Annual Report CVS Health Corp - CVS, Form 10-K February 9, 2016 CVS Health Corp - CVS, Form 10-K February 10, 2015 CVS Health Corp - CVS, Form 10-K February 11 2014 CVS Health Corp - CVS, Form 10-K February 15, 2013 CVS Health Corp - CVS, Form 10-K February 17, 2012 CVS Health Corp - CVS, Form 10-K February 18, 2011 CVS Health Corp - CVS, Form 10-K February 26, 2010 CVS Health Corp - CVS, Form 10-K February 27, 2009 CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 7 DECEMBER 9, 2016 REPORT OF BRETT E. BARLAG ON BEHALF OF CVS PHARMACY, INC. Appendix C: List of Materials Considered Bates Bates Bates CVSC-0001800 CVSC-0223163 CVSC-0351799 CVSC-0323374 CVSC-0223164 CVSC-0351802 CVSC-0229413 CVSC-0223165 CVSC-0351805 CVSC-0224002 CVSC-0223166 CVSC-0351807 CVSC-0226628 CVSC-0223167 CVSC-0351810 CVSC-0225151 CVSC-0223168 CVSC-0351813 CVSC-0226673 CVSC-0223169 CVSC-0351816 CVSC-0224842 CVSC-0223170 CVSC-0351819 CVSC-0223974 CVSC-0223171 CVSC-0351822 CVSC-0236969 CVSC-0223172 CVSC-0351825 CVSC-0239216 CVSC-0223173 CVSC-0351828 CVSC-0342374 CVSC-0223174 CVSC-0351831 CVSC-0342376 CVSC-0223175 CVSC-0333490 CVSC-0342380 CVSC-0223176 CVSC-0348968 CVSC-0342384 CVSC-0223177 CVSC-0348968 CVSC-0342386 CVSC-0223295 CVSC-0345541 CVSC-0351524 CVSC-0223385 CVSC-0345566 CVSC-0342389 CVSC-0223457 CVSC-0345569 CVSC-0342395 CVSC-0223506 CVSC-0349026 CVSC-0327633 CVSC-0223624 CVSC-0345588 CVSC-0329255 CVSC-0223680 CVSC-0345608 CVSC-0352101 CVSC-0223782 CVSC-0333533 CVSC-0356390 CVSC-0223785 CVSC-0345621 CVSC-0342395 CVSC-0223786 CVSC-0345625 CVSC-0342406 CVSC-0223787 CVSC-0345630 CVSC-0356399 CVSC-0223789 CVSC-0345633 CVSC-0324071 CVSC-0223792 CVSC-0345653 CVSC-0336547 CVSC-0223794 CVSC-0345682 CVSC-0336549 CVSC-0223809 CVSC-0349026 CVSC-0336554 CVSC-0223810 CVSC-0349048 CVSC-0336663 CVSC-0223812 CVSC-0349068 CVSC-0336672 CVSC-0223813 CVSC-0349088 CVSC-0336674 CVSC-0224662 CVSC-0349107 CVSC-0336752 CVSC-0226329 CVSC-0349127 CVSC-0336805 CVSC-0226476 CVSC-0349147 CVSC-0336847 CVSC-0226628 CVSC-0345713 CVSC-0336851 CVSC-0226673 CVSC-0331871 CVSC-0336900 CVSC-0229413 CVSC-0345733 CVSC-0336911 CVSC-0236969 CVSC-0345725 CVSC-0336943 CVSC-0312974 CVSC-0328801 CVSC-0336982 CVSC-0312974 CVSC-0328842 CVSC-0336987 CVSC-0341298 CVSC-0327877 CVSC-0337066 CVSC-0341298 CVSC-0333564 CVSC-0337084 CVSC-0341311 CVSC-0333580 CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 7 DECEMBER 9, 2016 REPORT OF BRETT E. BARLAG ON BEHALF OF CVS PHARMACY, INC. Appendix C: List of Materials Considered Bates Bates Bates CVSC-0337086 CVSC-0341311 CVSC-0349780 CVSC-0337134 CVSC-0341329 CVSC-0349814 CVSC-0337153 CVSC-0341329 CVSC-0349850 CVSC-0337185 CVSC-0341349 CVSC-0345969 CVSC-0337197 CVSC-0341349 CVSC-0345976 CVSC-0337201 CVSC-0341389 CVSC-0345986 CVSC-0337262 CVSC-0341389 CVSC-0346000 CVSC-0336482 CVSC-0341420 CVSC-0346024 CVSC-0336655 CVSC-0341420 CVSC-0346054 CVSC-0336824 CVSC-0341433 CVSC-0346058 CVSC-0336915 CVSC-0341433 CVSC-0346062 CVSC-0337034 CVSC-0341436 CVSC-0346066 CVSC-0337090 CVSC-0341436 CVSC-0351834 CVSC-0337162 CVSC-0341474 CVSC-0349274 CVSC-0337216 CVSC-0341474 CVSC-0349395 CVSC-0337287 CVSC-0341515 CVSC-0349471 CVSC-0337331 CVSC-0341515 CVSC-0349520 CVSC-0337377 CVSC-0341531 CVSC-0328069 CVSC-0337415 CVSC-0341531 CVSC-0328379 CVSC-0337481 CVSC-0341556 CVSC-0345740 CVSC-0337531 CVSC-0341556 CVSC-0345750 CVSC-0337562 CVSC-0342759 CVSC-0345765 CVSC-0337618 CVSC-0350502 CVSC-0345768 CVSC-0337631 CVSC-0350502 CVSC-0345776 CVSC-0337682 CVSC-0350514 CVSC-0345779 CVSC-0337757 CVSC-0350514 CVSC-0345784 CVSC-0337798 CVSC-0350522 CVSC-0345788 CVSC-0337832 CVSC-0350522 CVSC-0345798 CVSC-0337869 CVSC-0350529 CVSC-0345803 CVSC-0337886 CVSC-0350529 CVSC-0348596 CVSC-0337936 CVSC-0350530 CVSC-0349167 CVSC-0337972 CVSC-0350530 CVSC-0349230 CVSC-0338009 CVSC-0391314 CVSC-0351838 CVSC-0338046 CVSC-0391316 CVSC-0350230 CVSC-0338090 CVSC-0391317 CVSC-0327637 CVSC-0338131 CVSC-0391318 CVSC-0327517 CVSC-0338176 CVSC-0391319 CVSC-0327565 CVSC-0338216 CVSC-0391320 CVSC-0327652 CVSC-0338253 CVSC-0391321 CVSC-0327812 CVSC-0338275 CVSC-0391322 CVSC-0327977 CVSC-0338311 CVSC-0391323 CVSC-0328485 CVSC-0323277 CVSC-0391324 CVSC-0329206 CVSC-0336482 CVSC-0391325 CVSC-0345814 CVSC-0336655 CVSC-0391326 CVSC-0345819 CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 7 DECEMBER 9, 2016 REPORT OF BRETT E. BARLAG ON BEHALF OF CVS PHARMACY, INC. Appendix C: List of Materials Considered Bates Bates Bates CVSC-0336824 CVSC-0391327 CVSC-0345822 CVSC-0336915 CVSC-0391328 CVSC-0345835 CVSC-0337034 CVSC-0391329 CVSC-0345864 CVSC-0337090 CVSC-0391330 CVSC-0345880 CVSC-0337162 CVSC-0391331 CVSC-0345885 CVSC-0337216 CVSC-0391332 CVSC-0345890 CVSC-0337287 CVSC-0391333 CVSC-0345903 CVSC-0337331 CVSC-0391334 CVSC-0345905 CVSC-0337377 CVSC-0391335 CVSC-0345907 CVSC-0337415 CVSC-0391336 CVSC-0345920 CVSC-0337481 CVSC-0391337 CVSC-0345926 CVSC-0337531 CVSC-0391338 CVSC-0345930 CVSC-0337562 CVSC-0391339 CVSC-0345933 CVSC-0337618 CVSC-0391340 CVSC-0345936 CVSC-0337631 CVSC-0391341 CVSC-0345938 CVSC-0337682 CVSC-0391342 CVSC-0345940 CVSC-0337757 CVSC-0391343 CVSC-0345948 CVSC-0337798 CVSC-0391344 CVSC-0345950 CVSC-0337832 CVSC-0391345 CVSC-0345952 CVSC-0337869 CVSC-0391346 CVSC-0345955 CVSC-0337886 CVSC-0391347 CVSC-0345957 CVSC-0337936 CVSC-0391348 CVSC-0345959 CVSC-0337972 CVSC-0391349 CVSC-0345961 CVSC-0338009 CVSC-0391350 CVSC-0345963 CVSC-0338046 CVSC-0391351 CVSC-0345965 CVSC-0338090 CVSC-0391352 CVSC-0341493 CVSC-0338131 CVSC-0391353 CVSC-0341515 CVSC-0338176 CVSC-0391354 CVSC-0349814 CVSC-0338216 CVSC-0391355 CVSC-0349667 CVSC-0338253 CVSC-0391356 CVSC-0349705 CVSC-0338275 CVSC-0391357 CVSC-0349743 CVSC-0338311 CVSC-0391358 CVSC-0350503 CVSC-0323251 CVSC-0391359 CVSC-0350514 CVSC-0328301 CVSC-0391360 CVSC-0336832 CVSC-0342555 CVSC-0391361 CVSC-0346070 CVSC-0322963 CVSC-0391362 CVSC-0336502 CVSC-0342408 CVSC-0391363 CVSC-0336653 CVSC-0342412 CVSC-0391364 CVSC-0336778 CVSC-0342432 CVSC-0391365 CVSC-0336853 CVSC-0342457 CVSC-0391366 CVSC-0336945 CVSC-0342511 CVSC-0391367 CVSC-0337074 CVSC-0342527 CVSC-0391368 CVSC-0337144 CVSC-0328806 CVSC-0391369 CVSC-0337194 CVSC-0328806 CVSC-0391370 CVSC-0337243 CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 7 DECEMBER 9, 2016 REPORT OF BRETT E. BARLAG ON BEHALF OF CVS PHARMACY, INC. Appendix C: List of Materials Considered Bates Bates Bates CVSC-0328846 CVSC-0391371 CVSC-0336562 CVSC-0346288 CVSC-0391372 CVSC-0336582 CVSC-0346299 CVSC-0391373 CVSC-0336758 CVSC-0346305 CVSC-0391374 CVSC-0336861 CVSC-0346347 CVSC-0391375 CVSC-0336966 CVSC-0346357 CVSC-0391376 CVSC-0337068 CVSC-0346364 CVSC-0391377 CVSC-0337136 CVSC-0346370 CVSC-0391378 CVSC-0337189 CVSC-0346376 CVSC-0391379 CVSC-0337207 CVSC-0346381 CVSC-0391380 CVSC-0337267 CVSC-0346392 CVSC-0391381 CVSC-0337315 CVSC-0351345 CVSC-0391382 CVSC-0329161 CVSC-0356429 CVSC-0391383 CVSC-0337278 CVSC-0342558 CVSC-0391384 CVSC-0337362 CVSC-0348506 CVSC-0391385 CVSC-0337404 CVSC-0342597 CVSC-0391386 CVSC-0330765 CVSC-0342600 CVSC-0391387 CVSC-0331280 CVSC-0342613 CVSC-0391388 CVSC-0331553 CVSC-0342628 CVSC-0391389 CVSC-0331770 CVSC-0342647 CVSC-0391390 CVSC-0332540 CVSC-0342650 CVSC-0391391 CVSC-0332574 CVSC-0348664 CVSC-0391392 CVSC-0332806 CVSC-0350531 CVSC-0391393 CVSC-0333169 CVSC-0342672 CVSC-0391394 CVSC-0329267 CVSC-0342703 CVSC-0391395 CVSC-0327473 CVSC-0342709 CVSC-0391396 CVSC-0327927 CVSC-0342711 CVSC-0391397 CVSC-0328801 CVSC-0342714 CVSC-0391398 CVSC-0328842 CVSC-0342718 CVSC-0391399 CVSC-0329161 CVSC-0342731 CVSC-0391400 CVSC-0329267 CVSC-0342751 CVSC-0391401 CVSC-0330453 CVSC-0342759 CVSC-0391402 CVSC-0331017 CVSC-0342790 CVSC-0348660 CVSC-0332164 CVSC-0342798 CVSC-0348660 CVSC-0332528 CVSC-0342801 CVSC-0356433 CVSC-0336562 CVSC-0342804 CVSC-0333761 CVSC-0336582 CVSC-0342807 CVSC-0344146 CVSC-0336758 CVSC-0342811 CVSC-0351515 CVSC-0336861 CVSC-0342814 CVSC-0351521 CVSC-0336966 CVSC-0342818 CVSC-0356436 CVSC-0337068 CVSC-0342825 CVSC-0356442 CVSC-0337136 CVSC-0342829 CVSC-0329548 CVSC-0337189 CVSC-0342833 CVSC-0344155 CVSC-0337207 CVSC-0342836 CVSC-0325147 CVSC-0337267 CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 7 DECEMBER 9, 2016 REPORT OF BRETT E. BARLAG ON BEHALF OF CVS PHARMACY, INC. Appendix C: List of Materials Considered Bates Bates Bates CVSC-0342854 CVSC-0344180 CVSC-0337315 CVSC-0342856 CVSC-0344185 CVSC-0337404 CVSC-0342858 CVSC-0344193 CVSC-0333627 CVSC-0351334 CVSC-0344202 CVSC-0351539 CVSC-0351361 CVSC-0344206 CVSC-0351609 CVSC-0351369 CVSC-0344208 CVSC-0328027 CVSC-0351371 CVSC-0348684 CVSC-0345321 CVSC-0351494 CVSC-0336490 CVSC-0345323 CVSC-0351667 CVSC-0336670 CVSC-0345326 CVSC-0351841 CVSC-0336832 CVSC-0345331 CVSC-0329483 CVSC-0336941 CVSC-0345333 CVSC-0342661 CVSC-0337062 CVSC-0345335 CVSC-0342861 CVSC-0337113 CVSC-0345337 CVSC-0342868 CVSC-0337187 CVSC-0345340 CVSC-0341329 CVSC-0337261 CVSC-0345343 CVSC-0341312 CVSC-0337280 CVSC-0345353 CVSC-0350490 CVSC-0337328 CVSC-0345429 CVSC-0350502 CVSC-0337375 CVSC-0345504 CVSC-0342870 CVSC-0337413 CVSC-0345506 CVSC-0342879 CVSC-0337466 CVSC-0345508 CVSC-0342882 CVSC-0337537 CVSC-0345511 CVSC-0342885 CVSC-0337593 CVSC-0345519 CVSC-0342902 CVSC-0337616 CVSC-0345527 CVSC-0342971 CVSC-0337639 CVSC-0356451 CVSC-0342979 CVSC-0337709 CVSC-0346080 CVSC-0324048 CVSC-0337784 CVSC-0346090 CVSC-0342907 CVSC-0325563 CVSC-0346102 CVSC-0342913 CVSC-0326136 CVSC-0346110 CVSC-0342935 CVSC-0326851 CVSC-0346126 CVSC-0342942 CVSC-0326915 CVSC-0346136 CVSC-0342946 CVSC-0327002 CVSC-0346148 CVSC-0342949 CVSC-0327209 CVSC-0326909 CVSC-0342953 CVSC-0327481 CVSC-0333656 CVSC-0337445 CVSC-0327711 CVSC-0346168 CVSC-0351432 CVSC-0327759 CVSC-0346172 CVSC-0322966 CVSC-0327831 CVSC-0346176 CVSC-0323098 CVSC-0327881 CVSC-0346194 CVSC-0322909 CVSC-0327983 CVSC-0346211 CVSC-0323156 CVSC-0328270 CVSC-0346228 CVSC-0323212 CVSC-0328429 CVSC-0346234 CVSC-0336558 CVSC-0328486 CVSC-0349940 CVSC-0336678 CVSC-0329219 CVSC-0346242 CVSC-0336814 CVSC-0325563 CVSC-0346258 CVSC-0336902 CVSC-0324061 CVSC-0346260 CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 7 DECEMBER 9, 2016 REPORT OF BRETT E. BARLAG ON BEHALF OF CVS PHARMACY, INC. Appendix C: List of Materials Considered Bates Bates Bates CVSC-0336989 CVSC-0324782 CVSC-0346262 CVSC-0351455 CVSC-0324949 CVSC-0346264 CVSC-0342961 CVSC-0325147 CVSC-0346275 CVSC-0351466 CVSC-0325437 CVSC-0349948 CVSC-0351471 CVSC-0325563 CVSC-0349970 CVSC-0322957 CVSC-0325741 CVSC-0328480 CVSC-0323062 CVSC-0326124 CVSC-0329135 CVSC-0323201 CVSC-0326136 CVSC-0329265 CVSC-0342988 CVSC-0326170 CVSC-0329285 CVSC-0342992 CVSC-0326182 CVSC-0346386 CVSC-0342996 CVSC-0326472 CVSC-0346389 CVSC-0343020 CVSC-0326915 CVSC-0346394 CVSC-0343034 CVSC-0327002 CVSC-0346399 CVSC-0343059 CVSC-0327209 CVSC-0346402 CVSC-0348545 CVSC-0327481 CVSC-0346405 CVSC-0343071 CVSC-0327711 CVSC-0346418 CVSC-0343081 CVSC-0327759 CVSC-0346421 CVSC-0343083 CVSC-0327875 CVSC-0356431 CVSC-0343087 CVSC-0327881 CVSC-0346164 CVSC-0343093 CVSC-0327919 CVSC-0346166 CVSC-0343095 CVSC-0327983 CVSC-0349004 CVSC-0343097 CVSC-0328270 CVSC-0349015 CVSC-0343099 CVSC-0328429 CVSC-0346425 CVSC-0343114 CVSC-0328825 CVSC-0346430 CVSC-0348676 CVSC-0329137 CVSC-0350020 CVSC-0323688 CVSC-0329163 CVSC-0333677 CVSC-0323948 CVSC-0329219 CVSC-0346433 CVSC-0324304 CVSC-0336490 CVSC-0346444 CVSC-0332122 CVSC-0336670 CVSC-0346475 CVSC-0332206 CVSC-0336941 CVSC-0351846 CVSC-0333637 CVSC-0337062 CVSC-0333339 CVSC-0343132 CVSC-0337113 CVSC-0329790 CVSC-0343153 CVSC-0337187 CVSC-0329288 CVSC-0343166 CVSC-0337261 CVSC-0329372 CVSC-0343172 CVSC-0337280 CVSC-0336502 CVSC-0343180 CVSC-0337328 CVSC-0336653 CVSC-0343199 CVSC-0337375 CVSC-0336778 CVSC-0343207 CVSC-0337413 CVSC-0336853 CVSC-0346664 CVSC-0337466 CVSC-0336945 CVSC-0346683 CVSC-0337537 CVSC-0337074 CVSC-0323374 CVSC-0337593 CVSC-0337144 CVSC-0323398 CVSC-0337616 CVSC-0337194 CVSC-0351379 CVSC-0337639 CVSC-0337243 CVSC-0351386 CVSC-0337709 CVSC-0337278 CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 7 DECEMBER 9, 2016 REPORT OF BRETT E. BARLAG ON BEHALF OF CVS PHARMACY, INC. Appendix C: List of Materials Considered Bates Bates Bates CVSC-0351389 CVSC-0337784 CVSC-0338495 CVSC-0351392 CVSC-0326136 CVSC-0342343 CVSC-0351395 CVSC-0336498 CVSC-0329790 CVSC-0351418 CVSC-0336665 CVSC-0333339 CVSC-0351429 CVSC-0336842 CVSC-0327979 CVSC-0341330 CVSC-0336937 CVSC-0329399 CVSC-0341342 CVSC-0337057 CVSC-0329881 CVSC-0341343 CVSC-0337130 CVSC-0330903 CVSC-0341349 CVSC-0337157 CVSC-0331662 CVSC-0341280 CVSC-0337211 CVSC-0331883 CVSC-0341298 CVSC-0337271 CVSC-0332123 CVSC-0343696 CVSC-0337323 CVSC-0332175 CVSC-0343211 CVSC-0337371 CVSC-0332541 CVSC-0336554 CVSC-0337437 CVSC-0332877 CVSC-0336674 CVSC-0337509 CVSC-0333337 CVSC-0336847 CVSC-0337542 CVSC-0333407 CVSC-0336911 CVSC-0337597 CVSC-0336551 CVSC-0336982 CVSC-0337627 CVSC-0336749 CVSC-0336549 CVSC-0337679 CVSC-0336811 CVSC-0336672 CVSC-0337753 CVSC-0336897 CVSC-0337086 CVSC-0337791 CVSC-0336973 CVSC-0336805 CVSC-0337795 CVSC-0337080 CVSC-0336900 CVSC-0337829 CVSC-0337149 CVSC-0336987 CVSC-0337866 CVSC-0337203 CVSC-0337084 CVSC-0337919 CVSC-0337264 CVSC-0337153 CVSC-0337932 CVSC-0337320 CVSC-0337155 CVSC-0337964 CVSC-0337366 CVSC-0337197 CVSC-0338000 CVSC-0337408 CVSC-0337262 CVSC-0338037 CVSC-0337445 CVSC-0337201 CVSC-0338073 CVSC-0337527 CVSC-0325899 CVSC-0338078 CVSC-0337558 CVSC-0325899 CVSC-0338118 CVSC-0337613 CVSC-0326230 CVSC-0338164 CVSC-0337624 CVSC-0326541 CVSC-0338204 CVSC-0337675 CVSC-0326912 CVSC-0338243 CVSC-0337744 CVSC-0327001 CVSC-0338265 CVSC-0337786 CVSC-0327033 CVSC-0338303 CVSC-0337824 CVSC-0327241 CVSC-0338338 CVSC-0337860 CVSC-0327528 CVSC-0338348 CVSC-0337873 CVSC-0327581 CVSC-0338356 CVSC-0337914 CVSC-0337155 CVSC-0338362 CVSC-0337925 CVSC-0343216 CVSC-0338374 CVSC-0337968 CVSC-0343223 CVSC-0338382 CVSC-0338004 CVSC-0343231 CVSC-0338388 CVSC-0338041 CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 7 DECEMBER 9, 2016 REPORT OF BRETT E. BARLAG ON BEHALF OF CVS PHARMACY, INC. Appendix C: List of Materials Considered Bates Bates Bates CVSC-0343239 CVSC-0338393 CVSC-0338085 CVSC-0343243 CVSC-0338413 CVSC-0338127 CVSC-0343264 CVSC-0338422 CVSC-0338159 CVSC-0343268 CVSC-0338428 CVSC-0338210 CVSC-0343272 CVSC-0338445 CVSC-0338248 CVSC-0343288 CVSC-0338471 CVSC-0338268 CVSC-0343353 CVSC-0338475 CVSC-0338308 CVSC-0343405 CVSC-0336461 CVSC-0338342 CVSC-0343409 CVSC-0336633 CVSC-0338352 CVSC-0343414 CVSC-0336785 CVSC-0338360 CVSC-0343416 CVSC-0336880 CVSC-0338369 CVSC-0343421 CVSC-0325126 CVSC-0338379 CVSC-0343427 CVSC-0336461 CVSC-0338386 CVSC-0343434 CVSC-0336633 CVSC-0338392 CVSC-0343439 CVSC-0336785 CVSC-0338411 CVSC-0343444 CVSC-0336880 CVSC-0338417 CVSC-0343448 CVSC-0327927 CVSC-0338425 CVSC-0343460 CVSC-0348676 CVSC-0327867 CVSC-0343479 CVSC-0329168 CVSC-0328465 CVSC-0343498 CVSC-0329269 CVSC-0329147 CVSC-0343517 CVSC-0328074 CVSC-0329168 CVSC-0343521 CVSC-0328522 CVSC-0329269 CVSC-0343525 CVSC-0328851 CVSC-0329324 CVSC-0343529 CVSC-0329563 CVSC-0336551 CVSC-0343533 CVSC-0329942 CVSC-0336749 CVSC-0343537 CVSC-0330194 CVSC-0336811 CVSC-0343541 CVSC-0330466 CVSC-0336897 CVSC-0343545 CVSC-0331028 CVSC-0336973 CVSC-0324321 CVSC-0331344 CVSC-0337080 CVSC-0324549 CVSC-0331913 CVSC-0337149 CVSC-0324617 CVSC-0332207 CVSC-0337203 CVSC-0324792 CVSC-0332683 CVSC-0337264 CVSC-0324617 CVSC-0323707 CVSC-0337320 CVSC-0324792 CVSC-0323749 CVSC-0337366 CVSC-0324960 CVSC-0324327 CVSC-0337408 CVSC-0325152 CVSC-0324579 CVSC-0337527 CVSC-0325447 CVSC-0324749 CVSC-0337558 CVSC-0325605 CVSC-0324933 CVSC-0337613 CVSC-0325754 CVSC-0325112 CVSC-0337624 CVSC-0326135 CVSC-0325306 CVSC-0337675 CVSC-0326180 CVSC-0329271 CVSC-0337744 CVSC-0324547 CVSC-0329338 CVSC-0337786 CVSC-0324582 CVSC-0329385 CVSC-0337824 CVSC-0324752 CVSC-0329493 CVSC-0337860 CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 7 DECEMBER 9, 2016 REPORT OF BRETT E. BARLAG ON BEHALF OF CVS PHARMACY, INC. Appendix C: List of Materials Considered Bates Bates Bates CVSC-0324321 CVSC-0329526 CVSC-0337873 CVSC-0324547 CVSC-0336498 CVSC-0337914 CVSC-0324549 CVSC-0336665 CVSC-0337925 CVSC-0324582 CVSC-0336842 CVSC-0337968 CVSC-0324752 CVSC-0336937 CVSC-0338004 CVSC-0326182 CVSC-0337057 CVSC-0338041 CVSC-0326481 CVSC-0337130 CVSC-0338085 CVSC-0326861 CVSC-0337157 CVSC-0338127 CVSC-0326942 CVSC-0337211 CVSC-0338159 CVSC-0341350 CVSC-0337271 CVSC-0338210 CVSC-0341374 CVSC-0337323 CVSC-0338248 CVSC-0343723 CVSC-0337371 CVSC-0338268 CVSC-0343734 CVSC-0337437 CVSC-0338308 CVSC-0343737 CVSC-0337509 CVSC-0338342 CVSC-0343749 CVSC-0337542 CVSC-0338352 CVSC-0343761 CVSC-0337597 CVSC-0338360 CVSC-0343770 CVSC-0337627 CVSC-0338369 CVSC-0343814 CVSC-0337679 CVSC-0338379 CVSC-0343822 CVSC-0337753 CVSC-0338386 CVSC-0343828 CVSC-0337791 CVSC-0338392 CVSC-0343830 CVSC-0337795 CVSC-0338411 CVSC-0343832 CVSC-0337829 CVSC-0338417 CVSC-0343834 CVSC-0337866 CVSC-0338425 CVSC-0343844 CVSC-0337919 CVSC-0351662 CVSC-0343846 CVSC-0337932 CVSC-0356453 CVSC-0343849 CVSC-0337964 CVSC-0351302 CVSC-0343866 CVSC-0338000 CVSC-0351324 CVSC-0343868 CVSC-0338037 CVSC-0346500 CVSC-0343874 CVSC-0338073 CVSC-0346503 CVSC-0343880 CVSC-0338078 CVSC-0346505 CVSC-0343884 CVSC-0338118 CVSC-0346507 CVSC-0343897 CVSC-0338164 CVSC-0346510 CVSC-0343910 CVSC-0338204 CVSC-0346518 CVSC-0343931 CVSC-0338243 CVSC-0346522 CVSC-0343933 CVSC-0338265 CVSC-0346524 CVSC-0343954 CVSC-0338303 CVSC-0346543 CVSC-0343966 CVSC-0338338 CVSC-0346561 CVSC-0343978 CVSC-0338348 CVSC-0346583 CVSC-0343987 CVSC-0338356 CVSC-0346622 CVSC-0343998 CVSC-0338362 CVSC-0346641 CVSC-0344042 CVSC-0338374 CVSC-0351863 CVSC-0344050 CVSC-0338382 CVSC-0351889 CVSC-0344056 CVSC-0338388 CVSC-0351915 CVSC-0344062 CVSC-0338393 CVSC-0351941 CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 7 DECEMBER 9, 2016 REPORT OF BRETT E. BARLAG ON BEHALF OF CVS PHARMACY, INC. Appendix C: List of Materials Considered Bates Bates Bates CVSC-0344068 CVSC-0338413 CVSC-0351993 CVSC-0344071 CVSC-0338422 CVSC-0346702 CVSC-0344075 CVSC-0338428 CVSC-0346720 CVSC-0344088 CVSC-0338445 CVSC-0346723 CVSC-0344101 CVSC-0338471 CVSC-0346746 CVSC-0344111 CVSC-0338475 CVSC-0346765 CVSC-0344113 CVSC-0342986 CVSC-0346801 CVSC-0344130 CVSC-0346407 CVSC-0346805 CVSC-0344132 CVSC-0347463 CVSC-0346838 CVSC-0344134 CVSC-0329271 CVSC-0346872 CVSC-0351476 CVSC-0329338 CVSC-0346876 CVSC-0343552 CVSC-0329385 CVSC-0350243 CVSC-0341375 CVSC-0329493 CVSC-0333688 CVSC-0341389 CVSC-0329526 CVSC-0346909 CVSC-0344136 CVSC-0356449 CVSC-0346911 CVSC-0344141 CVSC-0344212 CVSC-0346914 CVSC-0350093 CVSC-0344215 CVSC-0346926 CVSC-0341390 CVSC-0344217 CVSC-0346928 CVSC-0341420 CVSC-0344237 CVSC-0346940 CVSC-0322963 CVSC-0341421 CVSC-0346943 CVSC-0323419 CVSC-0341433 CVSC-0346954 CVSC-0323965 CVSC-0341434 CVSC-0346956 CVSC-0336509 CVSC-0341436 CVSC-0346959 CVSC-0336739 CVSC-0350523 CVSC-0346971 CVSC-0328792 CVSC-0350529 CVSC-0346977 CVSC-0323398 CVSC-0323623 CVSC-0346992 CVSC-0327633 CVSC-0323710 CVSC-0346995 CVSC-0327757 CVSC-0344257 CVSC-0347007 CVSC-0323137 CVSC-0344309 CVSC-0347018 CVSC-0323251 CVSC-0344318 CVSC-0347020 CVSC-0327473 CVSC-0344323 CVSC-0347032 CVSC-0327877 CVSC-0344362 CVSC-0347035 CVSC-0000008 CVSC-0344366 CVSC-0347046 CVSC-0000026 CVSC-0344375 CVSC-0347048 CVSC-0000029 CVSC-0344384 CVSC-0347060 CVSC-0000030 CVSC-0341437 CVSC-0347063 CVSC-0000048 CVSC-0341444 CVSC-0347065 CVSC-0000057 CVSC-0350530 CVSC-0347076 CVSC-0000098 CVSC-0344176 CVSC-0347089 CVSC-0001242 CVSC-0341445 CVSC-0347091 CVSC-0001256 CVSC-0341457 CVSC-0347102 CVSC-0001269 CVSC-0341458 CVSC-0347104 CVSC-0001286 CVSC-0341474 CVSC-0347115 CVSC-0001295 CVSC-0344393 CVSC-0347117 CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 7 DECEMBER 9, 2016 REPORT OF BRETT E. BARLAG ON BEHALF OF CVS PHARMACY, INC. Appendix C: List of Materials Considered Bates Bates Bates CVSC-0001295 CVSC-0344414 CVSC-0347127 CVSC-0001448 CVSC-0351526 CVSC-0347129 CVSC-0001486 CVSC-0351539 CVSC-0347141 CVSC-0002169 CVSC-0351595 CVSC-0347144 CVSC-0003207 CVSC-0351609 CVSC-0347146 CVSC-0003354 CVSC-0344482 CVSC-0347157 CVSC-0003894 CVSC-0344486 CVSC-0347159 CVSC-0004892 CVSC-0344491 CVSC-0347162 CVSC-0008309 CVSC-0344493 CVSC-0347164 CVSC-0008915 CVSC-0344505 CVSC-0347175 CVSC-0012044 CVSC-0344512 CVSC-0347177 CVSC-0014111 CVSC-0344523 CVSC-0347180 CVSC-0014164 CVSC-0344537 CVSC-0347187 CVSC-0014183 CVSC-0344652 CVSC-0347189 CVSC-0014211 CVSC-0344445 CVSC-0347192 CVSC-0014225 CVSC-0328026 CVSC-0347195 CVSC-0014229 CVSC-0344428 CVSC-0347231 CVSC-0014294 CVSC-0344430 CVSC-0347233 CVSC-0014298 CVSC-0344441 CVSC-0347235 CVSC-0014323 CVSC-0344443 CVSC-0347237 CVSC-0014340 CVSC-0344449 CVSC-0347239 CVSC-0014349 CVSC-0344464 CVSC-0347258 CVSC-0014367 CVSC-0344478 CVSC-0347279 CVSC-0014385 CVSC-0344480 CVSC-0347282 CVSC-0014424 CVSC-0344547 CVSC-0347297 CVSC-0014519 CVSC-0344552 CVSC-0347300 CVSC-0014580 CVSC-0344556 CVSC-0347302 CVSC-0014691 CVSC-0344589 CVSC-0347305 CVSC-0014726 CVSC-0344592 CVSC-0347307 CVSC-0014729 CVSC-0344615 CVSC-0347310 CVSC-0015635 CVSC-0344643 CVSC-0347312 CVSC-0015645 CVSC-0344647 CVSC-0347314 CVSC-0016195 CVSC-0324350 CVSC-0347316 CVSC-0019063 CVSC-0324584 CVSC-0352031 CVSC-0020441 CVSC-0323632 CVSC-0356454 CVSC-0020511 CVSC-0323980 CVSC-0348670 CVSC-0021943 CVSC-0324350 CVSC-0348680 CVSC-0022004 CVSC-0324584 CVSC-0350262 CVSC-0022011 CVSC-0328301 CVSC-0350515 CVSC-0022022 CVSC-0328792 CVSC-0350522 CVSC-0022029 CVSC-0329513 CVSC-0333711 CVSC-0022954 CVSC-0342576 CVSC-0347318 CVSC-0023151 CVSC-0348524 CVSC-0347320 CVSC-0023690 CVSC-0336504 CVSC-0347323 CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 7 DECEMBER 9, 2016 REPORT OF BRETT E. BARLAG ON BEHALF OF CVS PHARMACY, INC. Appendix C: List of Materials Considered Bates Bates Bates CVSC-0024467 CVSC-0336601 CVSC-0343209 CVSC-0024509 CVSC-0327529 CVSC-0333723 CVSC-0024515 CVSC-0327680 CVSC-0347325 CVSC-0024519 CVSC-0327803 CVSC-0347331 CVSC-0024587 CVSC-0344661 CVSC-0347336 CVSC-0024720 CVSC-0327529 CVSC-0347361 CVSC-0024734 CVSC-0327680 CVSC-0328805 CVSC-0025028 CVSC-0327803 CVSC-0328835 CVSC-0025049 CVSC-0327813 CVSC-0329099 CVSC-0025064 CVSC-0336504 CVSC-0347364 CVSC-0025077 CVSC-0336601 CVSC-0347371 CVSC-0025093 CVSC-0336601 CVSC-0347377 CVSC-0025135 CVSC-0344822 CVSC-0347385 CVSC-0025163 CVSC-0344696 CVSC-0347396 CVSC-0025223 CVSC-0344702 CVSC-0347401 CVSC-0025468 CVSC-0344705 CVSC-0347406 CVSC-0025532 CVSC-0344718 CVSC-0347408 CVSC-0026650 CVSC-0344731 CVSC-0347410 CVSC-0026655 CVSC-0344742 CVSC-0347412 CVSC-0027254 CVSC-0344752 CVSC-0347420 CVSC-0028678 CVSC-0344756 CVSC-0350268 CVSC-0030785 CVSC-0344758 CVSC-0350277 CVSC-0032041 CVSC-0344761 CVSC-0333731 CVSC-0032565 CVSC-0344797 CVSC-0350286 CVSC-0032574 CVSC-0333460 CVSC-0350295 CVSC-0032673 CVSC-0328460 CVSC-0328035 CVSC-0032756 CVSC-0328460 CVSC-0350304 CVSC-0032837 CVSC-0341299 CVSC-0333744 CVSC-0032840 CVSC-0341311 CVSC-0347423 CVSC-0032848 CVSC-0344824 CVSC-0347439 CVSC-0032854 CVSC-0344855 CVSC-0347457 CVSC-0032881 CVSC-0344886 CVSC-0347455 CVSC-0033636 CVSC-0344989 CVSC-0347471 CVSC-0034639 CVSC-0344995 CVSC-0350340 CVSC-0034823 CVSC-0345001 CVSC-0350397 CVSC-0039473 CVSC-0341475 CVSC-0333447 CVSC-0041434 CVSC-0341492 CVSC-0350336 CVSC-0049949 CVSC-0333307 CVSC-0343130 CVSC-0052361 CVSC-0345019 CVSC-0343170 CVSC-0061336 CVSC-0345024 CVSC-0343178 CVSC-0061339 CVSC-0345038 CVSC-0345812 CVSC-0061342 CVSC-0348713 CVSC-0347483 CVSC-0061668 CVSC-0348713 CVSC-0328482 CVSC-0061970 CVSC-0350097 CVSC-0333571 CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 7 DECEMBER 9, 2016 REPORT OF BRETT E. BARLAG ON BEHALF OF CVS PHARMACY, INC. Appendix C: List of Materials Considered Bates Bates Bates CVSC-0062799 CVSC-0328017 CVSC-0347505 CVSC-0062800 CVSC-0330753 CVSC-0347507 CVSC-0067921 CVSC-0345042 CVSC-0347509 CVSC-0068402 CVSC-0345061 CVSC-0347512 CVSC-0129199 CVSC-0345076 CVSC-0347514 CVSC-0129312 CVSC-0345089 CVSC-0337362 CVSC-0129312 CVSC-0345092 CVSC-0327563 CVSC-0129313 CVSC-0348807 CVSC-0327747 CVSC-0129946 CVSC-0348808 CVSC-0333772 CVSC-0145836 CVSC-0348888 CVSC-0347516 CVSC-0163647 CVSC-0351663 CVSC-0347545 CVSC-0163656 CVSC-0333592 CVSC-0352044 CVSC-0163657 CVSC-0329324 CVSC-0324071 CVSC-0163662 CVSC-0345105 CVSC-0323277 CVSC-0163699 CVSC-0345124 CVSC-0327565 CVSC-0163700 CVSC-0345143 CVSC-0329372 CVSC-0163715 CVSC-0351669 CVSC-0329288 CVSC-0163716 CVSC-0327537 CVSC-0325126 CVSC-0163728 CVSC-0327661 CVSC-0327813 CVSC-0163729 CVSC-0327795 CVSC-0327919 CVSC-0163764 CVSC-0327807 CVSC-0327875 CVSC-0163765 CVSC-0345159 CVSC-0347575 CVSC-0163779 CVSC-0345162 CVSC-0347577 CVSC-0163780 CVSC-0345164 CVSC-0347636 CVSC-0163915 CVSC-0345166 CVSC-0332913 CVSC-0163916 CVSC-0345168 CVSC-0352048 CVSC-0163926 CVSC-0345170 CVSC-0347580 CVSC-0163927 CVSC-0345172 CVSC-0347597 CVSC-0163939 CVSC-0345174 CVSC-0347612 CVSC-0163968 CVSC-0345176 CVSC-0347614 CVSC-0163969 CVSC-0345178 CVSC-0347617 CVSC-0163980 CVSC-0345180 CVSC-0347619 CVSC-0163981 CVSC-0345182 CVSC-0347621 CVSC-0164034 CVSC-0345184 CVSC-0347623 CVSC-0164064 CVSC-0345186 CVSC-0347625 CVSC-0164065 CVSC-0345188 CVSC-0347628 CVSC-0164069 CVSC-0345190 CVSC-0347630 CVSC-0164070 CVSC-0345192 CVSC-0347632 CVSC-0164079 CVSC-0345194 CVSC-0347634 CVSC-0164080 CVSC-0345196 CVSC-0347643 CVSC-0164096 CVSC-0345198 CVSC-0347655 CVSC-0164107 CVSC-0345200 CVSC-0329913 CVSC-0164162 CVSC-0345202 CVSC-0329444 CVSC-0164163 CVSC-0345204 CVSC-0330938 CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 7 DECEMBER 9, 2016 REPORT OF BRETT E. BARLAG ON BEHALF OF CVS PHARMACY, INC. Appendix C: List of Materials Considered Bates Bates Bates CVSC-0164172 CVSC-0345206 CVSC-0331698 CVSC-0164210 CVSC-0345208 CVSC-0328823 CVSC-0164211 CVSC-0345210 CVSC-0329163 CVSC-0198667 CVSC-0345212 CVSC-0329170 CVSC-0199412 CVSC-0345214 CVSC-0329444 CVSC-0200926 CVSC-0345216 CVSC-0333589 CVSC-0201555 CVSC-0345218 CVSC-0346278 CVSC-0222034 CVSC-0345220 CVSC-0347666 CVSC-0222429 CVSC-0345229 CVSC-0347673 CVSC-0222487 CVSC-0345231 CVSC-0347675 CVSC-0222490 CVSC-0345233 CVSC-0347703 CVSC-0222492 CVSC-0345242 CVSC-0347718 CVSC-0222495 CVSC-0345244 CVSC-0347731 CVSC-0222498 CVSC-0345246 CVSC-0347784 CVSC-0222500 CVSC-0345248 CVSC-0347798 CVSC-0222502 CVSC-0345251 CVSC-0347860 CVSC-0222507 CVSC-0345254 CVSC-0347866 CVSC-0222511 CVSC-0345256 CVSC-0347870 CVSC-0222512 CVSC-0345258 CVSC-0347901 CVSC-0222516 CVSC-0345260 CVSC-0347928 CVSC-0222517 CVSC-0345262 CVSC-0347941 CVSC-0222519 CVSC-0345265 CVSC-0347972 CVSC-0222529 CVSC-0351675 CVSC-0347974 CVSC-0222531 CVSC-0348946 CVSC-0347997 CVSC-0222532 CVSC-0349998 CVSC-0348001 CVSC-0222534 CVSC-0333461 CVSC-0348027 CVSC-0222535 CVSC-0333486 CVSC-0348055 CVSC-0222551 CVSC-0345267 CVSC-0348085 CVSC-0222554 CVSC-0345294 CVSC-0348091 CVSC-0222555 CVSC-0345296 CVSC-0348097 CVSC-0222557 CVSC-0350676 CVSC-0348102 CVSC-0222560 CVSC-0350851 CVSC-0348107 CVSC-0222561 CVSC-0351027 CVSC-0348110 CVSC-0222564 CVSC-0323422 CVSC-0348114 CVSC-0222566 CVSC-0323753 CVSC-0348118 CVSC-0222572 CVSC-0324109 CVSC-0348122 CVSC-0222574 CVSC-0324389 CVSC-0348152 CVSC-0222576 CVSC-0342359 CVSC-0348122 CVSC-0222579 CVSC-0342360 CVSC-0348152 CVSC-0222581 CVSC-0342362 CVSC-0329511 CVSC-0222586 CVSC-0342367 CVSC-0327757 CVSC-0222587 CVSC-0345300 CVSC-0329511 CVSC-0222590 CVSC-0345302 CVSC-0350454 CVSC-0222600 CVSC-0345306 CVSC-0329106 CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 7 DECEMBER 9, 2016 REPORT OF BRETT E. BARLAG ON BEHALF OF CVS PHARMACY, INC. Appendix C: List of Materials Considered Bates Bates Bates CVSC-0222602 CVSC-0345309 CVSC-0333775 CVSC-0222606 CVSC-0345313 CVSC-0348181 CVSC-0222608 CVSC-0345316 CVSC-0348211 CVSC-0222610 CVSC-0345319 CVSC-0348215 CVSC-0222611 CVSC-0345346 CVSC-0348281 CVSC-0222615 CVSC-0345348 CVSC-0348219 CVSC-0222684 CVSC-0345351 CVSC-0348227 CVSC-0222727 CVSC-0345356 CVSC-0341521 CVSC-0222728 CVSC-0345359 CVSC-0341531 CVSC-0222729 CVSC-0345362 CVSC-0348291 CVSC-0222731 CVSC-0345367 CVSC-0344204 CVSC-0222732 CVSC-0345370 CVSC-0344210 CVSC-0222733 CVSC-0345373 CVSC-0329206 CVSC-0222735 CVSC-0345376 CVSC-0327801 CVSC-0222739 CVSC-0345379 CVSC-0327812 CVSC-0222743 CVSC-0345382 CVSC-0327977 CVSC-0222760 CVSC-0345387 CVSC-0328485 CVSC-0222765 CVSC-0345389 CVSC-0329206 CVSC-0222766 CVSC-0345392 CVSC-0348293 CVSC-0222768 CVSC-0345394 CVSC-0348315 CVSC-0222779 CVSC-0345396 CVSC-0348361 CVSC-0222781 CVSC-0345398 CVSC-0348363 CVSC-0222782 CVSC-0345401 CVSC-0348365 CVSC-0222784 CVSC-0345403 CVSC-0348368 CVSC-0222788 CVSC-0345405 CVSC-0348371 CVSC-0222790 CVSC-0345408 CVSC-0352094 CVSC-0222792 CVSC-0345411 CVSC-0352097 CVSC-0222794 CVSC-0345414 CVSC-0328385 CVSC-0222798 CVSC-0345418 CVSC-0329192 CVSC-0222800 CVSC-0345423 CVSC-0348374 CVSC-0222869 CVSC-0345426 CVSC-0348388 CVSC-0222870 CVSC-0345437 CVSC-0348392 CVSC-0222874 CVSC-0345440 CVSC-0348395 CVSC-0222877 CVSC-0345443 CVSC-0348397 CVSC-0222878 CVSC-0345446 CVSC-0348399 CVSC-0222883 CVSC-0345449 CVSC-0348401 CVSC-0222893 CVSC-0345451 CVSC-0348404 CVSC-0222895 CVSC-0345454 CVSC-0348407 CVSC-0222899 CVSC-0345456 CVSC-0348409 CVSC-0222901 CVSC-0345458 CVSC-0348423 CVSC-0222903 CVSC-0345462 CVSC-0348425 CVSC-0222904 CVSC-0345466 CVSC-0348427 CVSC-0222906 CVSC-0345473 CVSC-0348429 CVSC-0222909 CVSC-0345477 CVSC-0348431 CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 7 DECEMBER 9, 2016 REPORT OF BRETT E. BARLAG ON BEHALF OF CVS PHARMACY, INC. Appendix C: List of Materials Considered Bates Bates Bates CVSC-0222948 CVSC-0345479 CVSC-0348433 CVSC-0222949 CVSC-0345482 CVSC-0348435 CVSC-0222950 CVSC-0345484 CVSC-0348437 CVSC-0222951 CVSC-0345486 CVSC-0348439 CVSC-0222952 CVSC-0345492 CVSC-0348441 CVSC-0222954 CVSC-0345498 CVSC-0348443 CVSC-0222959 CVSC-0345502 CVSC-0348445 CVSC-0222960 CVSC-0345535 CVSC-0348447 CVSC-0222961 CVSC-0345536 CVSC-0348449 CVSC-0222963 CVSC-0348684 CVSC-0348451 CVSC-0222966 CVSC-0348705 CVSC-0348453 CVSC-0222968 CVSC-0356445 CVSC-0348456 CVSC-0222983 CVSC-0351694 CVSC-0348458 CVSC-0222998 CVSC-0351708 CVSC-0348461 CVSC-0223000 CVSC-0351715 CVSC-0348464 CVSC-0223002 CVSC-0351721 CVSC-0348466 CVSC-0223005 CVSC-0351730 CVSC-0348468 CVSC-0223006 CVSC-0351738 CVSC-0348470 CVSC-0223009 CVSC-0351741 CVSC-0348472 CVSC-0223010 CVSC-0351744 CVSC-0348479 CVSC-0223012 CVSC-0351748 CVSC-0348481 CVSC-0223024 CVSC-0351750 CVSC-0348483 CVSC-0223027 CVSC-0351753 CVSC-0348485 CVSC-0223084 CVSC-0351756 CVSC-0348487 CVSC-0223086 CVSC-0351759 CVSC-0348489 CVSC-0223099 CVSC-0351762 CVSC-0348491 CVSC-0223120 CVSC-0351765 CVSC-0348493 CVSC-0223124 CVSC-0351768 CVSC-0348496 CVSC-0223130 CVSC-0351771 CVSC-0348498 CVSC-0223135 CVSC-0351774 CVSC-0348500 CVSC-0223140 CVSC-0351777 CVSC-0348502 CVSC-0223145 CVSC-0351780 CVSC-0327466 CVSC-0223150 CVSC-0351784 CVSC-0333577 CVSC-0223153 CVSC-0351787 CVSC-0341532 CVSC-0223160 CVSC-0351790 CVSC-0341556 CVSC-0223161 CVSC-0351793 CVSC-0223162 CVSC-0351796 CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 7 DECEMBER 9, 2016 REPORT OF BRETT E. BARLAG ON BEHALF OF CVS PHARMACY, INC. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 7 DECEMBER 9, 2016 REPORT OF BRETT E. BARLAG ON BEHALF OF CVS PHARMACY, INC. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 7 DECEMBER 9, 2016 REPORT OF BRETT E. BARLAG ON BEHALF OF CVS PHARMACY, INC. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 7 DECEMBER 9, 2016 REPORT OF BRETT E. BARLAG ON BEHALF OF CVS PHARMACY, INC. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 7 DECEMBER 9, 2016 REPORT OF BRETT E. BARLAG ON BEHALF OF CVS PHARMACY, INC. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 7 DECEMBER 9, 2016 REPORT OF BRETT E. BARLAG ON BEHALF OF CVS PHARMACY, INC. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 7 DECEMBER 9, 2016 REPORT OF BRETT E. BARLAG ON BEHALF OF CVS PHARMACY, INC. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 7 DECEMBER 9, 2016 REPORT OF BRETT E. BARLAG ON BEHALF OF CVS PHARMACY, INC. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 7 DECEMBER 9, 2016 REPORT OF BRETT E. BARLAG ON BEHALF OF CVS PHARMACY, INC. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 7 DECEMBER 9, 2016 REPORT OF BRETT E. BARLAG ON BEHALF OF CVS PHARMACY, INC. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 7 DECEMBER 9, 2016 REPORT OF BRETT E. BARLAG ON BEHALF OF CVS PHARMACY, INC. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 7 DECEMBER 9, 2016 REPORT OF BRETT E. BARLAG ON BEHALF OF CVS PHARMACY, INC. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER 7 DECEMBER 9, 2016 REPORT OF BRETT E. BARLAG ON BEHALF OF CVS PHARMACY, INC. CONFIDENTIAL INFORMATION SUBJECT TO PROTECTIVE ORDER