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Surescripts Throws Down the Gauntlet in Amazon PillPack Spat: Brainstorm Health

Happy Monday, readers! I hope you had a wonderful weekend.

There's a veritable battle of the titans afoot in the pharmacy space. And it's pitting Surescripts, a health IT and information network, against a startup called ReMy Health and tech giant Amazon's online pharmacy service PillPack.

Shares of legacy pharmacy chains such as CVS and Walgreens sunk when Amazon announced its pickup of PillPack last June, sending shockwaves across an industry that's been wary of the tech giant's forays into the health care space for a while now.

Now, Surescripts says it's prepared to hand over a dispute involving a third party startup called ReMy Health and PillPack over to the FBI.

"Specifically, we have suspended ReMy Health from our network, are terminating their contract, and are turning the matter over to the FBI for further investigation," said Surescripts CEO Tom Skelton in an emailed statement to reporters.

So, what's going on here? CNBC's Chrissy Farr had the first report on this growing brouhaha a few weeks ago. Put simply, Surescripts claims that ReMy Health had been providing disingenuous information in order to acquire prescription drug histories available on Surescripts' network and then giving it to one or more of its customers (aka, PillPack).

This kind of data is critical, especially for a company like Amazon that's fairly new to the prescription delivery business. Now, Surescripts—which, critically, is backed by massive legacy firms such as CVS and the benefits giant Express Scripts, which aren't exactly fans of Amazon elbowing in to their territory—has cut off both ReMy Health and, by extension, PillPack. (PillPack had already threatened to sue Surescripts over being cut off from access to this patient information; Surescripts is now clearly hitting back.)

PillPack takes exception to the allegations. "Our requests for patient information are made with the explicit consent of our customers and all information we provide is accurate. Any suggestion otherwise is false," said PillPack spokesperson Jacquelyn Miller in an emailed statement. "Given that Surescripts is, to our knowledge, the sole clearinghouse for medication history in the United States, the core question is whether Surescripts will allow customers to share their medication history with pharmacies and if not, why not?"

The battle for digital pharmacy dominance is clearly heating up.

Read on for the day's news.

Sy Mukherjee, @the_sy_guy, sayak.mukherjee@fortune.com

INDICATIONS

Pfizer-Mylan cometh. Another Monday, another big planned merger in the pharma space—this time, between Pfizer and generic drug giant Mylan (the maker of the EpiPen and also a massive slew of generic medications). Ok, so technically, the deal was announced over the weekend. And there were some wildly differing shareholder reactions to the deal, which would combine Pfizer’s Upjohn unit (which consists of some of its tried-and-true, but older, branded medications such as Lipitor and Viagra, which no longer bring in quite as much money) with Mylan’s generic portfolio following a spinoff. Mylan shares soared nearly 13% in Monday trading while Pfizer slipped nearly 4%. Mylan shareholders may be feeling the excitement given consistent criticisms of the generic drug makers’ leadership and strategy. The deal structure, certainly, is fascinating. More on this soon. (Fortune)

Novartis faces setback for heart drug Entresto, shares slip. Swiss drug maker Novartis’ shares slipped about 1.1% after its promising heart drug Entresto proved to be, well, not so promising in a new indication. Novartis had predicted that winning the new indication in a different patient population with heart disease could have raised sales by 66%. (Reuters)

THE BIG PICTURE

Harris releases a twist on Medicare for All. Democratic presidential candidate Sen. Kamala Harris released a new health care plan ahead of the third and fourth Democratic debates on Tuesday and Wednesday. Health care is expected to take center stage at the debates, and Harris’ plan—which roughly cuts the difference between more conservative Democrats’ push for a public option and Sen. Bernie Sanders’ far more generous Medicare for All plan, which would more or less eliminate private insurance—already drew rebukes from both former Vice President Joe Biden and Sanders himself. I’ll be providing a more detailed breakdown of the leading candidates’ various positions on health care soon, but this is a good read on what Harris is proposing.

REQUIRED READING

China’s Biggest Private Sector Company Is Betting Its Future on Data, by Clay Chandler

Autonomous Trains Are Ready to Rollby Aaron Pressman

How a 37-Year-Old Former Teacher Became India’s Newest Billionaireby Bloomberg

The Bond Market Is Betting Tesla Is in Troubleby Erik Sherman

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