Document:

Settlement Agreement and Mutual Release, dated as of October 23, 2006

 Exhibit 10.1 
 SETTLEMENT AGREEMENT 
 AND MUTUAL RELEASES 
 I. PARTIES 
 This Settlement Agreement (this
“Agreement”), dated as of the Effective Date (as defined below), is entered into by and among the United States of America, acting through the United States Department of Justice, on behalf of the Office of Inspector General
(“OIG-HHS”) of the Department of Health and Human Services (“HHS”); the Office of Personnel Management (“OPM”); and the Department of Defense TRICARE Management Activity (“TMA”) (collectively the “United
States”); defendant Medco Health Solutions, Inc. (“Medco”); defendant Diane M. Collins (“Collins”); and relators George Bradford Hunt, Walter William Gauger and Joseph Piacentile (collectively the “Relators”)
through their authorized representatives. (OIG-HHS, OPM, TMA, Medco, Collins and the Relators are each referred to herein as a “Party” and are collectively referred to as the “Parties.”) 
 II. PREAMBLE 
 As a preamble to this Agreement,
the Parties recite the following: 
 A. Medco is a pharmaceutical services company that administers pharmacy benefit management
(“PBM”) services for health plans and employers, including governmental employers. Medco operates mail order pharmacies and call centers licensed by states and other political subdivisions, and employs pharmacists subject to state
licensing requirements. Medco provides mail order prescriptions and related benefit services for federal employees and retirees and their dependents and other federal beneficiaries, pursuant to contracts with federal health programs, including the
Federal Employees Health Benefits Program, a federally-funded health care program providing health insurance to federal employees, retirees and their families (“FEHBP”), TRICARE (formerly CHAMPUS), and Medicare + Choice Plans. Medco is a
Delaware Limited Liability Corporation with its principal executive offices located at 100 Parsons Pond Drive, Franklin Lakes, New Jersey 07417. Medco is the corporate successor of Merck-Medco Managed Care, L.L.C., and operates or has operated
prescription drug mail order pharmacies under the names of wholly-owned subsidiaries including Merck-Medco Managed Care of California, Inc., Merck-Medco Rx Services of Florida No. 2, L.L.C., Merck-Medco Rx Services of Florida, L.L.C.,
Merck-Medco Rx Services of Massachusetts, L.L.C., Merck-Medco Rx Services of Nevada, Inc., Merck-Medco Rx Services of New Jersey, L.L.C., Merck-Medco Rx Services of New York, L.L.C., 
  

					
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 Merck-Medco Rx Service of Ohio, Ltd., Merck-Medco Rx Services of Ohio No. 2, Ltd., Merck-Medco Rx Services of
Oklahoma, L.L.C., Merck-Medco Rx Services of Pennsylvania, L.L.C., Merck-Medco Rx Services of Texas, L.L.C., Merck-Medco Rx Services of Virginia , L.L.C., and Merck-Medco Rx Services of Washington, Inc. For purposes of this Agreement, unless the
context clearly requires otherwise, the term “Medco” shall be deemed to include Medco Health Solutions, Inc., and its past and present parents, subsidiaries, predecessors and successors and each of the assigns of any of the foregoing.

 B. Collins was the Vice President, General Manager of Merck-Medco Rx Services of Florida No. 2, L.L.C. from January 1999 through
January 2001. 
 C. Relator George Bradford Hunt (“Hunt”) and Relator Walter W. Gauger (“Gauger”) are pharmacists who
were employed by defendant Medco prior to 1999 at its Las Vegas, Nevada pharmacy facility. On May 6, 1999, Relators Hunt and Gauger filed a qui tam action in the United States District Court for the Eastern District of
Pennsylvania captioned United States ex rel. George Bradford Hunt and Walter W. Gauger, Relators, and the States of Florida, California, Illinois, Tennessee, Texas, Michigan, Louisiana, Nevada, Massachusetts, Virginia, and the District of
Columbia v. Merck & Co., Inc. Merck-Medco Managed Care, L.L.C., and Medco Health Solutions. Inc., Case No. 99-CV-2332. Relators Hunt and Gauger thereafter filed an Amended Complaint on February 16, 2000, a Second Amended
Complaint on March 18, 2003, and a Third Amended Complaint on October 3, 2003. On February 10, 2000, Relator Joseph Piacentile (“Piacentile”), never employed by Medco, filed a qui tam action in the United
States District Court for the Eastern District of Pennsylvania captioned United States of America ex rel. Joseph Piacentile v. Merck & Co. Inc. and Merck-Medco Managed Care, L.L.C., Case No. 00-CV-737. The Hunt and Gauger qui
tam Complaint and the Piacentile qui tam Complaint were consolidated by Court order into one action at No. 00-CV-737 (hereinafter “the Civil Action”). The United States intervened in the consolidated action on
June 20, 2003, and filed its Complaint in intervention on September 29, 2003, and an Amended Complaint (“Amended Complaint”) on December 9, 2003. The United States served notice on all counsel of an intent to file, but did
not file, a Second Amended Complaint on August 13, 2004 (the “Second Amended Complaint”). The Civil Action (including all Complaints filed by Hunt, Gauger, and Piacentile prior to consolidation), the Amended Complaint, and allegations
of the Second Amended Complaint are referred to herein collectively as the “Consolidated Action.” 
  

					
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 D. On or about April 26, 2004, Medco and the United States of America, acting through the United
States Department of Justice, consented to the entry of a Consent Order of Court for Permanent Injunction, entered by the Clerk of Court on May 20, 2004 (the “2004 Consent Order”), resolving certain civil claims for injunctive relief
pursuant to 18 U.S.C. § 1345 by the United States of America in Count VI of the Amended Complaint. The 2004 Consent Order expressly did not resolve any claim, right or cause of action for monetary damages, restitution or penalties sought in
Count I (False Claims Act, 31 U.S.C. § 3729 et seq.), Count II (Anti-Kickback Act, 41 U.S.C. §§ 51, et seq.), or Counts III, IV and V (principles of common law and equity) of the Amended Complaint.

 E. The United States contends that Medco and Defendant Collins submitted or caused to be submitted claims for payment, pursuant to the
Federal Employees Health Benefits Program, 5 U.S.C. §§ 8901-8914, and the TRICARE Program (formerly known as CHAMPUS), 10 U.S.C. §§ 1071-1110, to the following government-funded health care programs or plans: the Blue Cross Blue
Shield Association (“BCBSA”) under Contract No. CS 1039 (often referred to as the Federal Employees Program (“FEP”) or the Service Benefit Plan (“SBP”)), the Government Employees Hospital Association, Inc.
(“GEHA”), the National Association of Letter Carriers (“NALC”), the American Postal Workers Union (“APWU”), the Special Agents Mutual Benefit Association (“SAMBA”), the Department of Defense’s National
Mail-Order Pharmacy (“NMOP”), the American Foreign Service (“AFS”), the National Alliance of Postal Federal Employees (“NAPFE”), and the Tennessee Valley Authority. The foregoing shall be collectively referred to in
this Agreement as the “Federal Plans.” Medco’s prime contracts and subcontracts with the Federal Plans are hereinafter referred to, singly and collectively, unless otherwise noted, as the “Federal Plan Contracts.”

 F. The United States contends that it has certain civil claims against Collins, as specified in subparagraphs F.1 (to the extent Collins
is named in the Consolidated Action) and F.2 below, and against Medco, as specified in subparagraphs F.1-F.4 below, for engaging in the following conduct during the period from January 1, 1995, through December 31, 2004 (hereinafter
referred to as the “Covered Conduct”): 
 1. All allegations contained in the Consolidated Action. 
  

					
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 2. Under the Federal Plan Contracts, Medco agreed to certain performance guarantees and was obligated to
perform professional pharmacy services in accordance with these contracts, state pharmacy laws and regulations, and applicable codes of ethics. The United States alleges that Medco failed to satisfy its contractual performance guarantees, accurately
report its performance under the Federal Plan Contracts, or meet its pharmacy practice obligations, and in so doing submitted false claims for payment, made or used false documents in support of false claims, and made or used false documents to
reduce a liability due the United States, in the following manner: 
 a. The United States alleges that Medco falsely reported turnaround
performance under Federal Plan Contracts, including under the FEP contract from 1996 through 2003 on its daily waterfall reports, monthly invoice packages reporting turnaround and associated contract penalties, and Annual Statements as a result of
the following alleged practices or occurrences: 
 (i) Canceling, destroying or re-entering prescriptions into its prescription database
system to report a later and inaccurate prescription “receive date” (date prescription was first received by Medco) for the purpose of showing Medco had met contractual turnaround performance standards or for avoiding contractual
penalties; 
 (ii) Excluding prescriptions received toward the end of each month from the monthly turnaround reports and contract penalty
calculations (ie., the “end of month” problem); 
 (iii) Reporting prescriptions canceled after the two-day or five-day
turnaround standard as though they had been canceled on or before the turnaround deadline, thereby inappropriately reducing the denominator of the turnaround calculation (i.e., failing to “freeze” turnaround results); 
 (iv) For managed care switches, reporting turnaround performance using the receive date of the authorization to change the prescription, rather than the
receive date of the original prescription; 
 (v) For unfilled prescriptions delivered from one Medco facility to another for processing,
falsely recording or reporting the date of transfer or some other date as the date of receipt, rather than the actual date the prescription was first received by Medco; 
 (vi) Reporting falsely that prescriptions manifested on Saturday or Sunday had been manifested on the preceding business day; 
  

					
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 (vii) Canceling prescriptions without a valid reason using a stop cancel code “STCXL” in
combination with reason code “CX999”; 
 (viii) Canceling prescriptions for which no record exists in Medco’s Protocol
Management Database (PMD); 
 (ix) Canceling prescriptions as “out of stock” using the OOSTK reason or resolution code, when the
drug called for by the prescription was not out of stock; and 
 (x) Canceling prescriptions in doctor call, drug utilization review
(“DUR”) and other areas in the pharmacy without making an attempt to clarify the prescription with the physician or patient. 
 b.
The United States alleges that Medco dispensed prescriptions without properly performing DUR, without screening, and without appropriately contacting prescribers after screening; 
 c. The United States alleges that Medco failed to interpret or evaluate prescriptions and resolve any errors or ambiguities in accordance with state
laws, regulations and standards of practice; 
 d. The United States alleges that Medco falsified paper or electronic pharmacy records
related to the dispensing process, which is defined as the time from which Medco receives the written prescription through the time at which Medco places the prescription medication in the mail; 
 e. The United States alleges that Medco improperly used pharmacy technicians and other non-pharmacist personnel to perform functions which must by law be
performed by pharmacists, or under a pharmacist’s direct supervision, including adjudicating and dispensing or canceling patient prescriptions without review or supervision by a licensed pharmacists, engaging in direct discussions with
prescribers regarding dispensing and prescribing issues, counseling patients, and performing DUR activities; 
 f. The United States alleges
that Medco exceeded the state-established ratios of ancillary personnel or technicians to pharmacists and failed to adequately supervise and monitor ancillary pharmacy personnel or technicians; 
 g. The United States alleges that Medco established managerial structures and practices which had the foreseeable effect of causing inadequate
supervision of pharmacy personnel and interfering with professional pharmacists’ ability to exercise independent professional judgment; 
  

					
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 h. The United States alleges that Medco imposed production quotas on professional and support personnel
within mail order pharmacies, which had the foreseeable effect of interfering with the professional obligation of pharmacists to adequately ensure clarification of prescription drug orders with prescribers prior to dispensing; 
 i. The United States alleges that Medco authorized non-pharmacist managerial personnel to use professional pharmacist credentials and access codes,
thereby enabling non-pharmacists to alter prescription drug records and access patient pharmacy records; 
 j. The United States alleges that
there existed a discrepancy between the number of prescriptions Medco billed for and claimed to have dispensed on its Annual Statements from 1997 to 2002, and the lower number of prescriptions accounted for on its turnaround reports during the same
period; 
 k. The United States alleges that Medco failed to certify its year 2000 Annual Statement to FEP; 
 l. The United States alleges that Medco submitted claims for prescriptions where Medco dispensed less than (i.e., “shorted”) the
quantity prescribed by the physician and billed by Medco to the Federal Plans; 
 m. The United States alleges that Medco switched or changed
patients’ prescriptions to different or more expensive or less effective drugs by providing false, misleading, or incomplete information or without the knowledge or consent of the patient or physician or without approval of the relevant Federal
Plan; 
 n. The United States alleges that Medco shipped and billed the government for drugs the patient never ordered; 
 o. The United States alleges that Medco shipped and billed the government for drugs without ensuring the correct number, strength, dosage, and type of
drugs were dispensed; 
  

					
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 p. The United States alleges that Medco failed to provide accurate, complete, timely and reliable
information to patients and physicians concerning: (i) the reasons for, costs relating to, and effect of the drug switches, in order to induce them to approve the switch, or withdraw their objection to the switch; (ii) whether and when
prescriptions had been received where the prescription had been improperly cancelled; and (iii) pharmacists’ views concerning whether generic drugs sold by Medco were always “just as good as” brand name drugs; 
 q. The United States alleges that Medco restocked and reused returned medication; 
 r. The United States alleges that Medco failed to monitor clinical outcomes for drug switches for its patients; 
 s. The United States alleges that Medco fabricated records of calls to physicians in connection with doctor call, DUR, managed care, and other required
physician contacts, and otherwise created false records of contact with physicians; 
 t. The United States alleges that Medco failed to
provide required customer service and counseling; 
 u. The United States alleges that Medco falsified reports of Class A error rates to
improve recorded performance; 
 v. The United States alleges that Medco failed to pursue cost reduction opportunities with certain
manufacturers, in return for payment of inducements by their competitor manufacturers, including Merck & Co., Inc. (“Merck”), to Medco; 
 w. The United States alleges that Medco promoted drugs then likely to remain on patent for long periods of time, and switched patients from drugs which would be subject to generic competition and cost reductions in
the near future; 
 x. The United States alleges that Medco switched patients from drugs with a generic equivalent to drugs without a generic
equivalent; 
 y. The United States alleges that Medco promoted a formulary that favored expensive drugs; 
 z. The United States alleges that Medco induced FEP to execute or renew contracts based on the false statements regarding Medco’s performance; and

  

					
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 aa. the United States alleges that Medco charged excessive prices for generics at mail. 
 3. The United States alleges that Medco offered or made improper payments, as specifically set forth below in subparagraphs (a) through (e), in the
form of implementation allowances, contract allowances, data fees, credits, up-front payments, cash, and services to certain health plans to induce the plans to select Medco as a pharmacy benefit management subcontractor, or to retain Medco as a
pharmacy benefit management subcontractor. 
 a. Medco made payments to Oxford Health Plans pursuant to an Alliance Agreement dated
September 7, 2001, and a Prescription Drug Administrative Service Agreement dated September 7, 2001; 
 b. Medco made payments
pursuant to a Data License Agreement dated November 11,1998, a Pharmacy Benefit Management Agreement dated November 11, 1998, a Cooperation Agreement dated November 11, 1998, and a Pharmacy Benefit Management Agreement, dated
January 1, 2004; 
 c. Medco offered to make payments to Great West Life Annuity & Insurance Co. in connection with Requests
for Proposals issued in June 2001 and January 2004; 
 d. Medco offered or made payments to a health plan (i) pursuant to (A) a
Prescription Drug Program Agreement dated January 1, 1995; (B) a Prescription Program Agreement dated January 1, 2001; and (C) an Integrated Prescription Drug Program Master Agreement dated October 1, 2002; and
(ii) pursuant to any and all amendments to the agreements identified in subclause (i) as in effect prior to January 1, 2005; and 
 e. Medco offered or made payments to a health plan (i) pursuant to (A) a Pharmacy Benefit Services Agreement dated August 18, 1999; (B) a renewal letter dated October 1, 2002; and (C) a preliminary agreement
dated December 17, 2004, and (ii) pursuant to any and all amendments to the agreements identified in subclause (i) as in effect prior to January 1, 2005. 
 4. The United States alleges that Medco solicited and received improper payments (or, as to Merck, imputed payments) from pharmaceutical manufacturers to
induce or reward Medco for improperly providing favorable consideration to each such pharmaceutical manufacturer’s products; to induce Medco to promote the sale of such manufacturers’ products; to favor such manufacturers’ products
over different 
  

					
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 chemical compounds in the treatment of certain diseases; to favor and advocate such manufacturers’ products in
formulary placement; and to advocate switches to those favored products by physicians. These payments (or, as to Merck, imputed payments) were allegedly made in the form of rebates, regardless of how characterized, discounts, patient conversion
payments, market share movement payments, market share incentives, data fees, commissions, mail service purchase discounts, administrative or management fees, educational grants, outcomes research studies, RationalMed, clinical consulting services,
nominally-priced products, disease management program payments, and strategic alliances. 
 The United States alleges that the payments set
forth in this Paragraph 4 and in Paragraph 3 above constitute improper kickbacks, and that, based on such payments, Medco knowingly caused false claims to be made to the United States. The United States further alleges that to the extent the
above-described payments in Paragraphs 3 and 4 were not passed through, shared with or disclosed, Medco caused false claims to be made to the United States. 
 G. This Agreement is made in compromise of disputed claims. It is neither an admission of liability by either Medco or Collins nor a concession by the United States that its claims are not well founded. Medco and
Collins each expressly denies the allegations of the United States and the Relators as set forth herein and in the Consolidated Action and each such Party denies that it has engaged in any wrongful conduct relating to the Covered Conduct. Neither
this Agreement, its execution, or the performance of any obligations under it, including any payments, nor the fact of the settlement, is intended to be, or shall be understood as, an admission of liability or wrongdoing, or other expression
reflecting upon the merits of the dispute by Medco or by Collins. Further, nothing contained in this Agreement shall be interpreted or construed as an agreement or acknowledgment by Medco or by Collins as to whether any pharmaceutical manufacturer,
customer, or other entity which has, or previously has had, a contract with Medco has at any time engaged in any of the conduct alleged as wrongful in this Agreement or in the Consolidated Action. 
 To avoid the delay, uncertainty, inconvenience, and expense of litigation of the above claims, the Parties reach a full and final settlement of all
claims pursuant to the Terms and Conditions below. 
  

					
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 III. TERMS AND CONDITIONS 
 1. In consideration for the promises and agreements of the Parties as set forth herein, Medco agrees to pay to the United States $137,500,000.00 (the “Settlement Amount”), plus interest as described in the
letter from Medco to the United States of October 3, 2006 (the “Interest Letter”). The Settlement Amount shall constitute a debt immediately due and owing on the Effective Date (as defined in Paragraph 32 below) of this Agreement.
Medco agrees to pay the full Settlement Amount to the United States by electronic funds transfer pursuant to written instructions to be provided by the United States Attorney’s Office for the Eastern District of Pennsylvania. Medco agrees to
make this electronic funds transfer within fourteen (14) calendar days of the Effective Date of this Agreement. 
 2. Subject to the
exceptions set forth in Paragraph 7 below, and in consideration of the obligations of Medco set forth in this Agreement, conditioned upon Medco’s full and timely payment of the Settlement Amount, the United States (on behalf of itself, its
officers, agents, agencies, and departments), releases Medco and each of its past and present officers, directors, employees (including Collins), attorneys, insurers, and assigns of any of the foregoing (each a “Medco Released Party” and,
collectively, the “Medco Released Parties”) from any civil or administrative monetary claim that the United States has or may have for the Covered Conduct under the False Claims Act, 31 U.S.C. §§ 3729-3733; the Civil Monetary
Penalties Law, 42 U.S.C. § 1320a-7a; the Program Fraud Civil Remedies Act, 31 U.S.C. §§ 3801-3812; the Public Contract Anti-Kickback Act, 41 U.S.C. § 51, et seq.; any and all common law causes of action for fraud, unjust
enrichment, payment by mistake, or breach of contract; and any civil monetary claim arising under the aforementioned statutes and common law theories based on a violation of the Federal health care program anti-kickback statute, 42 U.S.C. §
1320a-7b(b). 
 3. Subject to the exceptions set forth in Paragraph 7 below, in consideration of the obligations of Medco set forth in this
Agreement, conditioned upon Medco’s full and timely payment of the Settlement Amount, each Relator, for himself and for his respective heirs, successors, attorneys, agents, representatives, and assignees (collectively, the “Relator
Releasors”), releases and forever discharges Medco and each other Medco Released Party from any claim the Relators ever had, has or may have relating to the Covered Conduct, including any civil monetary claim based on or under the False Claims
Act, 31 U.S.C. §§ 3729- 3733, and all state analogues thereto. Each Relator for himself and for his respective heirs, successors, 
  

					
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 attorneys, agents, representatives and assignees releases and forever discharges all other Relators and their respective
heirs, successors, attorneys, agents, representatives and assignees from any claim that he ever had, has, or may have, arising out of or in connection with the Covered Conduct and the United States’ and Relators’ investigation and
prosecution thereof. 
 4. In consideration of the obligations of Medco set forth in this Agreement and the Corporate Integrity Agreement
entered into by and between Medco, the Office of Inspector General of OPM (“OIG-OPM”) and OIG-HHS (the “CIA”), conditioned upon Medco’s full and timely payment of the Settlement Amount, OIG-HHS agrees to release and refrain
from instituting, directing or maintaining any administrative action seeking exclusion from the Medicare, Medicaid, and any other Federal health care programs (as defined in 42 U.S.C. § 1320a-7b(f)) under 42 U.S.C. § 1320a-7a (Civil
Monetary Penalties Law), or 42 U.S.C. § 1320a-7(b)(7) (permissive exclusion for fraud, kickbacks, and other prohibited activities), for the Covered Conduct against Medco, except as expressly reserved in Paragraph 7 below, and as reserved in
this Paragraph. The OIG-HHS expressly reserves all rights to comply with any statutory obligations to exclude any Medco Released Party from Medicare, Medicaid, and other Federal health care programs under 42 U.S.C. § 1320a-7(a) (mandatory
exclusion) relating to the Covered Conduct. Nothing in this Paragraph precludes the OIG-HHS from taking action against entities or persons, or for conduct and practices, for which claims have been reserved in Paragraph 7 below. 
 5. In consideration of the obligations of Medco set forth in this Agreement, conditioned upon Medco’s full and timely payment of the Settlement
Amount, TMA agrees to release and refrain from instituting, directing or maintaining any administrative action seeking exclusion from the TRICARE Program for the Covered Conduct against Medco under 32 C.F.R. § 199.9, except as reserved in
Paragraph 7 below and as reserved in this Paragraph. TMA expressly reserves authority to exclude any Medco Released Party from the TRICARE Program under 32 C.F.R. §§ 199.9(f)(1)(i)(A), (f)(1)(i)(B), and (f)(1)(iii) relating to the Covered
Conduct. Nothing in this Paragraph precludes TMA or the TRICARE Program from taking action against entities or persons, or for conduct and practices, for which claims have been reserved in Paragraph 7 below. 
 6. In consideration of the obligations of Medco set forth in this Agreement, conditioned upon Medco’s full and timely payment of the Settlement
Amount, OPM agrees to release and refrain from instituting, directing or maintaining any administrative action seeking exclusion from the FEHBP against Medco or any other 
  

					
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 Medco Released Party under 5 U.S.C. § 8902a or 5 C.F.R. Part 970, relating to the Covered Conduct, except as
reserved in Paragraph 7 below, and as reserved in this Paragraph. OPM expressly reserves all rights to comply with any statutory obligations to debar any Medco Released Party from the FEHBP under 5 U.S.C. § 8902a(b) (mandatory debarment)
relating to the Covered Conduct. Nothing in this Paragraph precludes OPM from taking action against entities or persons, or for conduct and practices, for which claims have been reserved in Paragraph 7 below. 
 7. Notwithstanding any term of this Agreement, specifically reserved and excluded from the scope and terms of this Agreement as to any entity or person
(including Medco, Collins and Relators) are the following claims of the United States: 
 a. Any civil, criminal, or administrative liability
arising under Title 26, U.S. Code (Internal Revenue Code); 
 b. Any criminal liability; 
 c. Except as explicitly stated in this Agreement, any administrative liability, including mandatory exclusion from Federal health care programs;

 d. Any liability to the United States (or its agencies) for any conduct other than the Covered Conduct; 
 e. Any liability of any individuals or entities not specifically and expressly released by this Agreement, including drug manufacturers and clients and
customers of Medco; 
 f. Any liability based upon such obligations as are created by this Agreement; 
 g. Any liability based upon obligations created by the 2004 Consent Order; 
 h. Any liability for personal injury or property damage or for other consequential damages arising therefrom; 
 i. Any administrative liability against individuals, including current and former directors, officers, and employees of Medco and other Medco corporate entities. 
 8. Relators and the United States have entered into separate and contemporaneous agreements (the “Relator Share Agreements”) setting forth the Relators’ respective shares under 31 U.S.C. §3730(d).
Each Relator, for himself and his heirs, successors, representatives, attorneys, agents, and assignees, agrees not to object to this Agreement or to the allocation of proceeds to his claims as set forth 
  

					
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 in the Relator Share Agreements dated October 23, 2006, and agrees and confirms that both this Agreement and the
Relator Share Agreements are “fair, adequate, and reasonable under all the circumstances,” pursuant to 31 U.S.C. § 3730(c)(2)(B). In addition, each Relator, for himself and his heirs, successors, representatives, attorneys, agents,
and assignees, agrees not to object to the separately executed settlement agreement dated October 23, 2006, relating to the United States ex rel. Schumann v. Medco, and agrees and confirms that both said agreement and the allocations of
proceeds thereunder are “fair, adequate, and reasonable under all the circumstances,” pursuant to 31 U.S.C. § 3730(c)(2)(B). Conditioned upon full and prompt receipt of Relators’ respective shares as set forth in those Relator
Share Agreements, each Relator, for himself and for his respective heirs, successors, representatives, attorneys, agents, and assignees, in full settlement of any claims such Relator may have under this Agreement, releases and forever discharges the
United States, its officers, agents, and employees, from any claims arising from or relating to 31 U.S.C. § 3730, from any claims arising from the filing of the Civil Action, and from any other claims for a share of the Settlement Amount, that
such Relator ever had, has or may have. This Agreement does not resolve or in any manner affect any claims the United States has or may have against any of the Relators arising under Title 26, U.S. Code (Internal Revenue Code), or any claims arising
under this Agreement. 
 9. Relators and Medco have entered into separate agreements (“Relator-Medco Agreements”) setting forth
amounts to be paid to Relators for expenses, attorneys fees and costs pursuant to 31 U.S.C. § 3730(d) and to Relators Hunt and Gauger for expenses, attorneys fees and costs pursuant to the Massachusetts False Claims Law and the Nevada False
Claims Act. Conditioned upon full and timely receipt of the payment described in the Relator-Medco Agreements, without in any way limiting the terms of Paragraph 3 above, each Relator, for himself and for his respective heirs, successors, attorneys,
agents, representatives, and assignees releases and forever discharges the Medco Released Parties (including Collins) from any and all claims that such Releasor ever had, has or may have pursuant to 31 U.S.C. § 3730(d) in connection with the
Consolidated Action and for expenses or attorneys fees and costs pursuant to the Massachusetts False Claims Law and the Nevada False Claims Act. 
  

					
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 10. Medco and Collins each waives and will not assert any defenses such Party may have to any criminal
prosecution or administrative action relating to the Covered Conduct not otherwise released pursuant to the terms hereof that may be based in whole or in part on a contention that, under the Double Jeopardy Clause in the Fifth Amendment of the
Constitution, or under the Excessive Fines Clause in the Eighth Amendment of the Constitution, this Agreement bars a remedy sought in such criminal prosecution or administrative action. Nothing in this Paragraph or any other provision of this
Agreement constitutes an agreement by the United States concerning the characterization of the Settlement Amount for purposes of the Internal Revenue laws, Title 26 of the United States Code. 
 11. Medco and Collins (collectively, the “Medco Releasors”) each release and forever discharge the United States, its agencies, employees,
servants and agents, as well as each of the Relators and their respective attorneys, heirs, successors, agents, representatives and assignees (collectively, the “Relator Releasees”) from any and all claims that any Medco Releasor ever had,
has or may have relating to the Covered Conduct and the United States’ and the Relators’ investigation and prosecution thereof and Relators Hunt’s and Gaugers employment with Medco. 
 12. The Settlement Amount shall not be decreased as a result of the denial of claims for payment now being withheld from payment by any Medicare carrier
or intermediary, TRICARE carrier or payer, FEHBP carrier or payer, or any state payer, related to the Covered Conduct; and Medco shall not resubmit to any Medicare carrier or intermediary, TRICARE carrier or payer, FEHBP carrier or payer, or any
state payer any previously denied claims related to the Covered Conduct, and shall not appeal any such denials of claims. 
  

					
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 13. Medco agrees to the following: 
 a. Unallowable Costs Defined: All costs (as defined in the Federal Acquisition Regulation, 48 C.F.R. § 31.205-47; and in Titles XVIII and XIX of the
Social Security Act, 42 U.S.C. §§ 1395-1395hhh and 1396-1396y; and the regulations and official program directives promulgated thereunder) incurred by or on behalf of Medco, its present or former officers, directors, employees,
shareholders, and agents in connection with the following shall be “unallowable costs” on government contracts and under the Medicare Program, Medicaid Program, TRICARE Program, and Federal Employees Health Benefits Program (FEHBP):

 i. the matters covered by this Agreement; 
 ii. the United States’ audit(s) and civil investigation(s) of the matters covered by this Agreement; 
 iii. Medco’s investigation, defense, and corrective actions undertaken in response to the United States’ audit(s) and civil investigation(s) in connection with the matters covered by this Agreement (including attorney’s fees
paid on behalf of Medco, Collins, and others related to this action), and implementation of the 2004 Consent Order; 
 iv. the negotiation
and performance of this Agreement; 
 v. the payment Medco makes to the United States pursuant to this Agreement and any payments that Medco
may make to Relators, including costs and attorneys fees; and 
 vi. the negotiation of, and obligations undertaken pursuant to the CIA to:

 (a) retain an independent review organization to perform annual reviews as described in Section III of the CIA; and 
 (b) prepare and submit reports to the OIG-HHS. 
 However,
nothing in this Paragraph13.a.(vi) that may apply to the obligations undertaken pursuant to the CIA affects the status of costs that are not allowable based on any other authority applicable to Medco. (All costs described or set forth in this
Paragraph13.a. are hereafter “unallowable costs.”) 
 b. Future Treatment of Unallowable Costs: These unallowable costs shall be
separately determined and accounted for by Medco, and Medco shall not charge such unallowable costs directly or indirectly to any contracts with the United States or any State Medicaid program, or seek 
  

					
	Case No. 99-CV-2332	  	15	  	

 payment for such unallowable costs through any cost report, cost statement, information statement, or payment request
submitted by Medco or any of its subsidiaries or affiliates to the Medicare, Medicaid, TRICARE, or FEHBP Programs. 
 c. Treatment of
Unallowable Costs Previously Submitted for Payment: Medco further agrees that within 90 days of the Effective Date of this Agreement it will identify to applicable Medicare and TRICARE fiscal intermediaries, carriers, or contractors, and Medicaid
and FEHBP fiscal agents, any unallowable costs (as defined in this Paragraph) included in payments previously sought from the United States, or any State Medicaid program, including payments sought in any cost reports, cost statements, information
reports, or payment requests already submitted by Medco or any of its subsidiaries or affiliates, and shall request, and agree, that such cost reports, cost statements, information reports, or payment requests, even if already settled, be adjusted
to account for the effect of the inclusion of the unallowable costs. Medco agrees that the United States, at a minimum, shall be entitled to recoup from Medco any overpayment plus applicable interest and penalties as a result of the inclusion of
such unallowable costs on previously-submitted cost reports, information reports, cost statements, or requests for payment. 
 Any payments
due after the adjustments have been made shall be paid to the United States pursuant to the direction of the Department of Justice or the affected agencies. The United States reserves its rights to disagree with any calculations submitted by Medco
or any of its subsidiaries or affiliates on the effect of inclusion of unallowable costs (as defined in this Paragraph) on Medco’s or any of its subsidiaries’ or affiliates’ cost reports, cost statements, or information reports.

 d. Nothing in this Agreement shall constitute a waiver of the rights of the United States to audit, examine, or re-examine Medco’s
books and records to determine that no unallowable costs have been claimed in accordance with the provisions of this Paragraph. 
 14. Medco
agrees to cooperate fully and truthfully with the United States’ investigation, if any, of individuals and entities not released in this Agreement. Upon reasonable notice, Medco shall (a) make reasonable efforts to facilitate access to,
and encourage the cooperation of its directors, officers, and employees for interviews and testimony, consistent with the rights and privileges of such individuals, (b) furnish to the United States, upon reasonable request, any non-privileged
documents in its possession, custody or control; and (c) make commercially reasonable efforts to cause any attorneys, auditors, 
  

					
	Case No. 99-CV-2332	  	16	  	

 investment bankers, or consultants engaged by Medco to furnish to the United States, upon reasonable request, any
non-privileged documents in the possession, custody or control of any such third party. Medco and the United States will cooperate in good faith to avoid duplicate production of documents. 
 15. Medco agrees that it shall not seek payment for any of the monies owed under this Agreement from any health care beneficiaries or their parents,
sponsors, legally responsible individuals, or third-party payers. Medco waives any causes of action against these beneficiaries or their parents, sponsors, legally responsible individuals, or third party payers based upon the claims for payment
covered by this Agreement. Medco waives and shall not seek payment for any of the health care billings covered by this Agreement from any health care beneficiaries or their parents, sponsors, legally responsible individuals, or third party payers
based upon the claims defined as Covered Conduct. 
 16. Each Party agrees to the following: 
 a. Each Relator hereby covenants and agrees in respect of himself and all other Relator Releasors on whose behalf he acts hereby that (i) no such
Relator Releasor will initiate or participate in bringing or pursuing any class action against any of such Relator Releasor’s respective Relator Releasees in respect of any such released claim in connection with the Covered Conduct (each a
“Class Action”); and (ii) if involuntarily included in any such Class Action as a putative class member will opt out upon Medco’s written request from any such Class Action. 
 b. Each Relator further hereby covenants and agrees in respect of himself and all other Relator Releasors on whose behalf he acts hereby that no such
Relator Releasor will assist any third party in initiating or pursuing any Class Action except where otherwise required by law. 
 17. Except
as expressly set forth in Paragraphs 2, 3, 4, 5, 6, 8, 9 and 11 above, this Agreement is intended to be for the benefit of the Parties only, and no Party releases, waives or otherwise discharges, and each Party expressly reserves, any claims such
Party may have against any other person or entity. 
 18. Nothing in this Agreement shall constitute a waiver of the rights of the United
States set forth in the 2004 Consent Order, nor shall this Agreement in any way relieve Medco of any of its obligations as set forth in the 2004 Consent Order. No waiver by any Party hereto of any one or more breaches or defaults by the other Party
in the performance of any of the provisions of this Agreement shall operate or be construed as a waiver of any future breaches or defaults, whether of a like or different nature. No failure or 
  

					
	Case No. 99-CV-2332	  	17	  	

 delay on the part of any Party in exercising any right, power or remedy hereunder shall operate as a waiver thereof, nor
shall any single or partial exercise of any such right, power or remedy preclude any other or further exercise thereof or the exercise of any other right, power or remedy. No Party shall be required to give notice to enforce strict adherence to all
terms of this Agreement. 
 19. Medco warrants that it has reviewed its respective financial situations and that it currently is solvent
within the meaning of 11 U.S.C. §§ 547(b)(3) and 548(a)(1)(B)(ii)(l), and will remain solvent following payment to the United States of the Settlement Amount. Further, the Parties warrant that, in evaluating whether to execute this
Agreement, they (a) have intended that the mutual promises, covenants, and obligations set forth constitute a contemporaneous exchange for new value given to Medco, within the meaning of 11 U.S.C. § 547(c)(1); and (b) conclude that
these mutual promises, covenants, and obligations do, in fact, constitute such a contemporaneous exchange. Further, the Parties warrant that the mutual promises, covenants, and obligations set forth herein are intended to and do, in fact, represent
a reasonably equivalent exchange of value that is not intended to hinder, delay, or defraud any entity that Medco was or became indebted to on or after the date of this transfer, within the meaning of 11 U.S.C. § 548(a)(1). 
 20. Except as expressly provided to the contrary in this Agreement and allowed by law, each Party shall bear its own legal and other costs incurred in
connection with this matter, including the preparation and performance of this Agreement. 
 21. Medco represents that this Agreement is
freely and voluntarily entered into without any degree of duress or compulsion whatsoever. 
 22. Collins represents that this Agreement is
freely and voluntarily entered into without any degree of duress or compulsion whatsoever. 
 23. Relators Hunt, Gauger and Piacentile
represent that this Agreement is freely and voluntarily entered into without any degree of duress or compulsion whatsoever. 
 24. This
Agreement is governed by the laws of the United States. The Parties agree that the exclusive jurisdiction and venue for any dispute arising between and among the Parties under this Agreement is the United States District Court for the Eastern
District of Pennsylvania, except that disputes arising under the CIA shall be resolved exclusively under the dispute resolution provisions in the CIA. 
  

					
	Case No. 99-CV-2332	  	18	  	

 25. This Agreement, together with the Interest Letter, the CIA, the 2004 Consent Order, the Relator Share
Agreements and the Relator-Medco Agreements, constitutes the complete agreement between the Parties with respect to the subject matter hereof and thereof and supersedes all prior oral or written communications between or among the Parties or any of
their affiliates regarding the subject matter hereof and thereof. This Agreement may not be amended except by written consent of the Parties, provided, however, that (a) only Medco, OIG-OPM and OIG-HHS must agree in writing to any
modification of the CIA; (b) only the Relators and the United States must agree in writing to any modification of the Relator Share Agreements; and (c) only the Relators and Medco must agree in writing to any modification of the
Relator-Medco Agreements. 
 26. Promptly following the execution of this Agreement the United States will sign and file stipulations of
dismissal with prejudice of the Consolidated Action and any and all allegations pertaining to the Covered Conduct (the “Stipulations of Dismissal”). 
 27. The individuals signing this Agreement on behalf of Medco represent and warrant that they are authorized by Medco to execute this Agreement. Each individual signing this Agreement on behalf of Collins represents
and warrants that such individual is authorized by Collins to execute this Agreement. Each individual signing this Agreement on behalf of a Relator represents and warrants that they are authorized by the applicable Relator to execute this Agreement.
The United States signatories represent that they are signing this Agreement in their official capacities and that they are authorized to execute this Agreement. Each Party further warrants and represents that such Party has not assigned or
transferred, or purported to assign or transfer, to any person or entity, any claims that such Party has or may have that are subject to this Agreement. 
 28. This Agreement may be executed in counterparts, each of which constitutes an original and all of which constitute one and the same Agreement. Facsimiles of signatures shall constitute acceptable, binding
signatures for purposes of this Agreement. 
 29. This Agreement is binding on Collins’ and Medco’s successors, transferees, heirs,
and assigns. 
 30. This Agreement is binding on the Relators’ respective successors, transferees, heirs, and assigns. 
  

					
	Case No. 99-CV-2332	  	19	  	

 31. All Parties consent to the disclosure of this Agreement, and information about this Agreement, to the
public. 
 32. The term “Effective Date” as used herein shall refer to the latest of the following dates: (a) the date that
the last signatory to the Agreement has executed the Agreement; and (b) the date that the Court enters the Stipulations of Dismissal. In the event that this Agreement does not become effective, this Agreement shall be treated as materials
received pursuant to Fed. R. Evid. 408. 
 33. All recitals are incorporated herein as material provisions of this Agreement. The captions
and headings of the Sections of this Agreement are for convenience of reference only and are not to be considered in construing this Agreement. Unless the context of this Agreement clearly requires otherwise: (a) references to the plural
include the singular, the singular the plural, and the part the whole, (b) references to one gender include all genders, (c) “or” has the inclusive meaning frequently identified with the phrase “and/or,”
(d) “including” has the inclusive meaning frequently identified with the phrase “including but not limited to” or “including without limitation,” (e) references to “hereunder,” “herein” or
“hereof” relate to this Agreement as a whole, and (f) the terms “dollars” and “$” refer to United States dollars. Section and subsection references are to this Agreement as originally executed unless otherwise
specified. Any reference herein to any person shall be deemed to include the heirs, personal representatives, successors and permitted assigns of such person. Any reference herein to a corporate entity shall be deemed to include the entity’s
past and present parents, subsidiaries, affiliates, predecessors, and successors and each of the assigns of any of the foregoing. 
 34. In
the event that any provision or portion of this Agreement shall be determined to be invalid or unenforceable for any reason, the remaining provisions of this Agreement shall be unaffected thereby and shall remain in full force and effect.

 35. Each Party agrees that the United States District Court for the Eastern District of Pennsylvania shall retain jurisdiction to enforce
the Agreement. 
 [SIGNATURES APPEAR ON FOLLOWING PAGES] 
  

					
	Case No. 99-CV-2332	  	20	  	

 IN WITNESS WHEREOF, the Parties have executed this Agreement as of the 23rd day of October, 2006. 
  
  

					
		 	THE UNITED STATES OF AMERICA
			
	DATED: 10/23/06	 	BY:	 	 /s/ JAMES G. SHEEHAN

		 		 	PATRICK L. MEEHAN
		 		 	United States Attorney
		 		 	JAMES G. SHEEHAN
		 		 	Associate United States Attorney

  

					
	Case No. 99-CV-2332	  	21	  	

					
	DATED: 10-23-06	 	BY:	 	 /s/ JOYCE R. BRANDA

		 		 	JOYCE R. BRANDA
		 		 	Deputy Director
		 		 	MICHAL L. TINGLE
		 		 	DAVID T. SHAPIRO
		 		 	Trial Attorneys
		 		 	Commercial Litigation Branch
		 		 	Civil Division
		 		 	United States Department of Justice

  

					
	Case No. 99-CV-2332	  	22	  	

					
	DATED: 10/23/06	 	BY:	 	 /s/ GREGORY E. DEMSKE

		 		 	GREGORY E. DEMSKE
		 		 	Assistant Inspector General for Legal Affairs
		 		 	Office of Counsel to the Inspector General
		 		 	Office of Inspector General
		 		 	United States Department of Health and Human Services

  

					
	Case No. 99-CV-2332	  	23	  	

					
	DATED: 20 Oct 2006	 	BY:	 	 /s/ LAUREL C. GILLESPIE

		 		 	LAUREL C. GILLESPIE
		 		 	Deputy General Counsel
		 		 	TRICARE Management Activity
		 		 	United States Department of Defense

  

					
	Case No. 99-CV-2332	  	24	  	

					
	DATED: 10/20/06	 	BY:	 	 /s/ KATHLEEN McGETTIGAN

		 		 	KATHLEEN McGETTIGAN
		 		 	Deputy Associate Director
		 		 	Center for Retirement & Insurance Services
		 		 	United States Office of Personnel Management

  

					
	Case No. 99-CV-2332	  	25	  	

					
	DATED. 10/20/2006	 	BY:	 	 /s/ J. DAVID COPE

		 		 	J. DAVID COPE
		 		 	Assistant Inspector General for Legal Affairs
		 		 	United States Office of Personnel Management

  

					
	Case No. 99-CV-2332	  	26	  	

					
		 	MEDCO HEALTH SOLUTIONS, INC.
			
	DATED: 23 Oct 2006	 	BY:	 	 /s/ Elizabeth S. Ferguson

		 		 	Elizabeth S. Ferguson
		 		 	Vice President, Litigation and Government Programs
			
	DATED: 23 Oct 2006	 	BY:	 	 /s/ William McDaniels

		 		 	William McDaniels
		 		 	Counsel for Medoo Health Solutions, Inc.

  

					
	Case No. 99-CV-2332	  	27	  	

					
		 	DIANE M. COLLINS
			
	DATED: 10/20/06	 	BY:	 	 /s/ Diane M. Collins

		 		 	Diane M. Collins
			
	DATED: 10/23/06	 	BY:	 	 /s/ Jack Fernandez

		 		 	Jack Fernandez
		 		 	Counsel for Diane M. Collins

  

					
	Case No. 99-CV-2332	  	28	  	

					
		 	GEORGE BRADFORD HUNT- RELATOR
			
	DATED: 10-20-06	 	BY:	 	 /s/ George Bradlord Hunt

		 		 	George Bradlord Hunt
			
	DATED: 10.23.06	 	BY:	 	 /s/ Marc S. Raspanti

		 		 	Marc S. Raspanti
		 		 	Alison Duncan
		 		 	Counsel for George Bradford Hunt

  

					
	Case No. 99-CV-2332	  	29	  	

					
		 	WALTER WILLIAM GAUGER - RELATOR
			
	DATED: Oct. 20, 2006	 	BY:	 	 /s/ Walter William Gauger

		 		 	Walter William Gauger
			
	DATED: 10.23.06	 	BY:	 	 /s/ Marc S. Raspanti

		 		 	Marc S. Raspanti
		 		 	Alison Duncan
		 		 	Counsel for Walter William Gauger

  

					
	Case No. 99-CV-2332	  	30	  	

					
		 	JOSEPH PIACENTILE - RELATOR
			
	DATED: Oct 19, 2006	 	BY:	 	 /s/ Joseph Piacentile

		 		 	Joseph Piacentile
			
	DATED: Oct 19, 2006	 	BY:	 	 /s/ David Stone

		 		 	David Stone
		 		 	Counsel for Joseph Piacentile

  

					
	Case No. 99-CV-2332	  	31Settlement Agreement and Mutual Release, dated as of October 23, 2006

 Exhibit 10.2 
 CONFIDENTIAL 
 SETTLEMENT AGREEMENT 
 AND MUTUAL RELEASES 
 I. PARTIES

 This Settlement Agreement (this “Agreement”), dated as of the Effective Date (as defined below), is entered into by and among
the United States of America, acting through the United States Department of Justice, on behalf of the Office of Inspector General (“OIG-HHS”) of the Department of Health and Human Services (“HHS”), the Office of Personnel
Management (“OPM”) (collectively the “United States”); defendant Medco Health Solutions, Inc. (“Medco”); and relator Karl S. Schumann (the “Relator”) through his authorized representatives. (The United States,
Medco, and Relator are each referred to herein as a “Party” and are collectively referred to as the “Parties.”) 
 II. PREAMBLE

 As a preamble to this Agreement, the Parties recite the following: 
 A. Medco is a pharmaceutical services company that administers pharmacy benefit management (“PBM”) services for health plans and employers,
including governmental employers. Medco operates mail order pharmacies and call centers licensed by states and other political subdivisions, and employs pharmacists subject to state licensing requirements. Medco provides mail order prescriptions and
related benefit services for federal employees and retirees and their dependents and other federal beneficiaries, pursuant to contracts with federal health programs, including the Federal Employees Health Benefits Program, a federally-funded health
care program providing health insurance to federal employees, retirees and their families (“FEHBP”), TRICARE (formerly CHAMPUS), and Medicare + Choice Plans. Medco is a Delaware Limited Liability Corporation with its principal executive
offices located at 100 Parsons Pond Drive, Franklin Lakes, New Jersey 07417. Medco is the corporate successor of Merck-Medco Managed Care, L,L.C., and operates or has operated prescription drug mail order pharmacies under the names of wholly-owned
subsidiaries including Merck-Medco Managed Care of California, Inc., Merck-Medco Rx Services of Florida No. 2, L.L.C., Merck-Medco Rx Services of Florida, L.L.C., Merck-Medco Rx Services of Massachusetts, L.L.C., Merck-Medco Rx Services of

  

					
	Schumann	  		  	

 Nevada, Inc., Merck-Medco Rx Services of New Jersey, L.L.C., Merck-Medco Rx Services of New York, L.L.C., Merck-Medco Rx
Service of Ohio, Ltd., Merck-Medco Rx Services of Ohio No. 2, Ltd., Merck-Medco Rx Services of Oklahoma, L.L.C., Merck-Medco Rx Services of Pennsylvania, L.L.C., Merck-Medco Rx Services of Texas, L.L.C., Merck-Medco Rx Services of Virginia ,
L.L.C., and Merck-Medco Rx Services of Washington, Inc. For purposes of this Agreement, unless the context clearly requires otherwise, the term “Medco” shall be deemed to include Medco Health Solutions, Inc., and its past and present
parents, subsidiaries, predecessors and successors and each of the assigns of any of the foregoing. 
 B. Relator Schumann is a registered
pharmacist and was a former Vice President of Pharmaceutical Contracting of Defendant Medco from December 1999 through January 2003. Relator Schumann currently resides in the State of New Jersey. On September 26, 2003, Relator filed a
qui tam action in the United States District Court for the Eastern District of Pennsylvania captioned United States ex rel. Schumann v. Medco. Relator filed his First Amended Complaint on November 9, 2005. Relator filed his
Motion for Leave to Amend the First Amended Complaint and for Extension of Seal and Second Amended Complaint on or about April 12, 2006. The Complaint and the First Amended Complaint shall be referred to hereinafter as “the Civil
Action.” 
 C. The United States contends that Medco submitted or caused to be submitted claims for payment, pursuant to the Federal
Employees Health Benefits Program, 5 U.S.C. § 8901 -8914, and the TRICARE Program (formerly known as CHAMPUS), 10 U.S.C. § 1071-1110, to the following government-funded health care programs or plans: the Blue Cross Blue Shield Association
(“BCBSA”) under Contract No. CS 1039 (often referred to as the Federal Employees Program (“FEP”) or the Service Benefit Plan (“SBP”)), the Government Employees Hospital Association, Inc. (“GEHA”), the National
Association of Letter Carriers (“NALC”), the American Postal Workers Union (“APWU”), the Special Agents Mutual Benefit Association (“ISAMBAH”), the Department of Defense’s National Mail-Order Pharmacy
(“NMOP”), the American Foreign Service (“AFS”), the National Alliance of Postal Federal Employees (“NAPFE”), and the Tennessee Valley Authority. The foregoing shall be collectively referred to in this Agreement as the
“Federal Plans.” Medco’s prime contracts and subcontracts with the Federal Plans are hereinafter referred to, singly and collectively, unless otherwise noted, as the “Federal Plan Contracts.” 
  

					
	Schumann	  	2	  	

 D. The United States contends that it has certain civil and administrative claims against Medco
(1) for alleged solicitation of, and receipt of, payments from certain companies and their predecessors, successors, subsidiaries or affiliates, (2) for allegedly knowingly submitting or causing to be submitted to the United States, false
claims and/or false records and statements in support of false claims in connection with such payments, and (3) for other alleged related conduct, as described in the following subclauses (i) through (xxii) below and, as applicable,
during the time periods specified by those subclauses (hereinafter the “Covered Conduct”): 
 i. All allegations contained in the
Civil Action; 
 ii. Payments for RationalMed services provided to Highmark Blue Cross Blue Shield at any time during the period
January 1, 2001 to October 1, 2005; 
 iii. Payments by Salix Pharmaceuticals to Medco in connection with the promotion of Colazal
to Highmark Blue Cross Blue Shield between 2002 and December 31, 2004; 
 iv. Payments for RationalMed services provided to Highmark Blue
Cross Blue Shield in connection with the brand name drug Colazal from January 1, 2001 to October 1, 2005; 
 v. Payments to Medco by
DuPont Pharmaceuticals Company in connection with the promotion of Coumadin between 1996 and October 1, 2005; 
 vi. Payments and
agreements to pay Medco by Bristol Myers-Squibb in connection with the promotion of Coumadin between 2001 and October 1, 2005; 
 vii.
Discounts, payments and agreements to pay Medco by Smith-Kline Beecham, PLC, and its successor, Glaxo SmithKline, in connection with the promotion of Zantac between 1996 and December 31, 2004; 
 viii. The price charged to Medco by the manufacturer, including discounts, for the brand name drug Zantac in connection with Medco’s mail order
pharmacy business at any time during the period June 1, 1996 to October 1, 2005; 
  

					
	Schumann	  	3	  	

 ix. Payments and agreements to pay Medco by Schering-Plough between 2000 and December 31, 2004 in
connection with the promotion of Rebetron; 
 x. Payments and agreements to pay Medco by Pfizer between 2000 and December 31, 2004 in
connection with the promotion of Lipitor; 
 xi. Payments and agreements to pay Medco by Boehringer Ingelheim Corporation. between 2000 and
December 31, 2004 in connection with the promotion of Atrovent and Combivent; 
 xii. Payments and agreements to pay Medco by Wyeth
Ayerst, Inc. between 1997 and December 31, 2004 in connection with the joint venture, Innovative Health Solutions, and any other disease management program or alliance; 
 xiii. Payments and agreements by Astra-Zeneca LP to pay Medco, or to pay Highmark Blue Cross Blue Shield by and through Medco, in connection with the
promotion of Nexium, Prilosec and Prevacid to Highmark Blue Cross Blue Shield between 1999 and October 1, 2005; 
 xiv. Payments and
agreements to pay Medco, or to pay Highmark Blue Cross Blue Shield by and through Medco, from pharmaceutical manufacturers in connection with RationalMed services provided by Medco to Highmark Blue Cross Blue Shield between 2001 and October 1,
2005; 
 xv. Payments and agreements to pay Medco, or to pay Highmark Blue Cross Blue Shield by and through Medco, by Bristol-Myers Squibb in
connection with the promotion of Pravachol to Highmark Blue Cross Blue Shield between 1999 through October 1, 2005; 
 xvi. Payments and
agreements to pay Medco, or to pay Highmark Blue Cross Blue Shield by and through Medco, by Merck & Co. in connection with the promotion of Vioxx to Highmark Blue Cross Blue Shield between 1999 and October 1, 2005; 
 xvii. Payments and agreements to pay Highmark Blue Cross Blue Shield by Medco in connection with Coumadin, Zantac, Rebetron, Lipitor, Nexium, Prevacid,
Prilosec, Celebrex, Pravachol, Vioxx, Colazal, and Protonix between 1996 and October 1, 2005; 
  

					
	Schumann	  	4	  	

 xviii. Payments and agreements to pay Highmark Blue Cross Blue Shield by Medco in connection with any
grant, product, service, sponsorship, contribution or subsidy between 2000 and October 1, 2005; 
 xix. Any liability Medco may have,
based upon any of its conduct before October 1, 2005, for any submission of false statements or claims relating to best price determination by any of the pharmaceutical manufacturers identified subclauses (i) through (xviii) above
based on pricing to Highmark; 
 xx. Medco’s preparation or submission of documents in support of any false claims covered by subclauses
(i) through (xviii) above to the extent such documents were produced through October 1, 2005; 
 xxi. Medco’s preparation
or submission of documents in order to avoid or reduce a liability to the United States resulting from the conduct described in subclauses (i) through (xx) above to the extent such documents were produced through October 1, 2005; and

 xxii. Any claims arising from or relating to any on-line calculation of lowest price after all rebates and remuneration relating to any of
above enumerated drugs at any time during the period January 1, 2000 through October 1, 2005 based on pricing to Highmark. 
 The
Covered Conduct relates only to the conduct of Medco and excludes any conduct of any other person or entity, including pharmaceutical manufacturers and their agents. 
 E. This Agreement is made in compromise of disputed claims. It is neither an admission of liability by Medco nor a concession by the United States that its claims are not well founded. Medco expressly denies the
allegations of the United States and the Relator as set forth herein and in the Civil Action and denies that it has engaged in any wrongful conduct relating to the Covered Conduct. Neither this Agreement, its execution, or the performance of any
obligations under it, including any payments, nor the fact of the settlement, is intended to be, or shall be understood as, an admission of liability or wrongdoing, or other expression 
  

					
	Schumann	  	5	  	

 reflecting upon the merits of the dispute by Medco. Further, nothing contained in this Agreement shall be interpreted or
construed as an agreement or acknowledgment by Medco as to whether any pharmaceutical manufacturer, customer, or other entity which has, or previously has had, a contract with Medco has at any time engaged in any of the conduct alleged as wrongful
in this Agreement or in the Civil Action. 
 To avoid the delay, uncertainty, inconvenience, and expense of litigation of the above claims,
the Parties reach a full and final settlement of all claims pursuant to the Terms and Conditions below. 
 III. TERMS AND CONDITIONS

 1. In consideration for the promises and agreements of the Parties as set forth herein, Medco agrees to pay to the United States
$9,500,000.00 (the “Settlement Amount”) plus interest as described in the letter from Medco to the United States dated October 3, 2006 (the “Interest Letter”). The Settlement Amount shall constitute a debt immediately due
and owing on the Effective Date (as defined in Paragraph 31 below) of this Agreement. Medco agrees to pay the full Settlement Amount to the United States by electronic funds transfer pursuant to written instructions to be provided by the United
States Attorney’s Office for the Eastern District of Pennsylvania. Medco agrees to make this electronic funds transfer within fourteen (14) calendar days of the Effective Date of this Agreement. 
 2. Subject to the exceptions set forth in Paragraph 7 below, and in consideration of the obligations of Medco set forth in this Agreement, conditioned
upon Medco’s full and timely payment of the Settlement Amount, the United States (on behalf of itself, its officers, agents, agencies, and departments), releases Medco and each of its past and present officers, directors, employees, attorneys,
insurers, and assigns of any of the foregoing (each a “Medco Released Party” and, collectively, the “Medco Released Parties”) from any civil or administrative monetary claim that the United States has or may have had for the
Covered Conduct under the False Claims Act, 31 U.S.C. § 3729-3733; the Civil Monetary Penalties Law, 42 U.S.C. § 1320a-7a; the Program Fraud Civil Remedies Act, 31 U.S.C. § 3801-381 2; the Public Contract Anti-Kickback Act, 41 U.S.C.
§ 51, et seq.; any and all common law causes of action for fraud, unjust enrichment, payment by mistake, or breach of contract; and any civil monetary claim arising under the aforementioned statutes and common law theories based on a
violation of the Federal health care program anti-kickback statute, 42 U.S.C. § 1320a-7b(b). 
  

					
	Schumann	  	6	  	

 3. Subject to the exceptions set forth in Paragraph 7 below, in consideration of the obligations of Medco
set forth in this Agreement, conditioned upon Medco’s full and timely payment of the Settlement Amount, the Relator, for himself and for his respective heirs, successors, attorneys, agents, representatives, and assigns (collectively, the
“Relator Releasors”), releases and forever discharges Medco and each other Medco Released Party from any claim the United States ever had, has or may have had relating to the Covered Conduct and all allegations contained in the Second
Amended Complaint filed on or about April 12, 2006, including any civil monetary claim based on or under the False Claims Act, 31 U.S.C. § 3729-3733, and all state analogues thereto. 
 4. In consideration of the obligations of Medco set forth in this Agreement and the Corporate Integrity Agreement entered into by and between Medco, the
Office of Inspector General of OPM (“OlG-OPM”) and OIG-HHS (the “CIA”), conditioned upon Medco’s full and timely payment of the Settlement Amount, OIG-HHS agrees to release and refrain from instituting, directing or
maintaining any administrative action seeking exclusion from the Medicare, Medicaid, and any other Federal health care programs (as defined in 42 U.S.C. § 1320a-7b(f)) under 42 U.S.C. § 1320a-7a (Civil Monetary Penalties Law), or 42 U.S.C.
§ 1320a-7(b)(7) (permissive exclusion for fraud, kickbacks, and other prohibited activities), for the Covered Conduct against Medco, except as expressly reserved in Paragraph 7 below, and as reserved in this Paragraph. The OIG-HHS expressly
reserves all rights to comply with any statutory obligations to exclude any Medco Released Party from Medicare, Medicaid, and other Federal health care programs under 42 U.S.C. § 1320a-7(a) (mandatory exclusion) based upon the Covered Conduct.
Nothing in this Paragraph precludes the OIG-HHS from taking action against entities or persons, or for conduct and practices, for which claims have been reserved in Paragraph 7 below. 
 5. In consideration of the obligations of Medco set forth in this Agreement, conditioned upon Medco’s full and timely payment of the Settlement
Amount, TMA agrees to release and refrain from instituting, directing or maintaining any administrative action seeking exclusion from the TRICARE Program for the Covered Conduct against Medco or any other Medco Released Party under 32 C.F.R. §
199.9, except as reserved in Paragraph 7 below and as reserved in this Paragraph. TMA expressly reserves authority to exclude any Medco Released Party from the TRICARE Program under 32 C.F.R. § 199.9(f(1)(i)(A), (f(1)(i)(B), and (f(1)(iii)
relating 
  

					
	Schumann	  	7	  	

 to the Covered Conduct. Nothing in this Paragraph precludes TMA or the TRICARE Program from taking action against
entities or persons, or for conduct and practices, for which claims have been reserved in Paragraph 7 below. 
 6. In consideration of the
obligations of Medco set forth in this Agreement, conditioned upon Medco’s full and timely payment of the Settlement Amount, OPM agrees to release and refrain from instituting, directing or maintaining any administrative action seeking
exclusion from the FEHBP against Medco or any other Medco Released Party under 5 U.S.C. § 8902a or 5 C.F.R. Part 970, relating to the Covered Conduct, except as reserved in Paragraph 7 below, and as reserved in this Paragraph. OPM expressly
reserves all rights to comply with any statutory obligations to debar any Medco Released Party from the FEHBP under 5 U.S.C. § 8902a(b) (mandatory debarment) relating to the Covered Conduct. Nothing in this Paragraph precludes OPM from taking
action against entities or persons, or for conduct and practices, for which claims have been reserved in Paragraph 7 below. 
 7.
Notwithstanding any term of this Agreement, specifically reserved and excluded from the scope and terms of this Agreement as to any entity or person (including Medco and Relator) are the following claims of the United States: 
 a. Any civil, criminal, or administrative liability arising under Title 26, U.S. Code (Internal Revenue Code); 
 b. Any criminal liability; 
 c. Except as
explicitly stated in this Agreement, any administrative liability, including mandatory exclusion from Federal health care programs; 
 d. Any
liability to the United States (or its agencies) for any conduct other than the Covered Conduct; 
 e. Any liability of any individuals or
entities not specifically and expressly released by this Agreement, including drug manufacturers arid clients and customers of Medco; 
 f.
Any liability based upon such obligations as are created by this Agreement; 
 g. Any liability based upon obligations created by the Consent
Order of Court for Permanent Injunction consented to by Medco and the United States, acting through the United States Department of Justice, on or about April 26, 2004 and entered by the Clerk of Court on May 20, 2004 (the “2004
Consent Order”); 
  

					
	Schumann	  	8	  	

 h. Any express or implied warranty claims or other liability for defective or deficient products and
services provided by Medco; 
 i. Any liability based on a failure to deliver items or services due; and 
 j. Any administrative liability against individuals, including current and former directors, officers, and employees of Medco. 
 8. Relator, for himself and for his heirs, successors, attorneys, agents, representatives and assignees, agrees not to object to this Agreement or to the
allocation of proceeds to his claims as set forth in the letter dated June 27, 2006, and agrees and confirms that both this Agreement and those allocations are “fair, adequate, and reasonable under all the circumstances,” pursuant to
31 U.S.C. § 3730(c)(2)(B). In addition, the Relator, for himself and his heirs, successors, attorneys, agents, and assigns, agrees not to object to the Agreement dated as of an even date therefrom, relating to United States ex rel.
George Bradford Hunt and Walter W. Gauger, Relators, and the States of Florida, California, Illinois, Tennessee, Texas, Michigan, Louisiana, Nevada, Massachusetts, Virginia. and the District of Columbia v. Merck & Co., Inc., Merck-Medco
Managed Care, L.L.C., and Medco Health Solutions, Inc., Case No. 99-CV-2332., and United States of America ex rel. Joseph Piacentile v. Merck & Co., Inc., and Merck-Medco Managed Care, L.L.C., Case No. 00-CV-737
(“Consolidated Action”), and agrees and confirms that both said Agreement and the allocations of proceeds thereunder are “fair, adequate, and reasonable under all the circumstances,” pursuant to 31 U.S.C. § 3730(c)(2)(B).
Relator and the United States have entered into a separate and contemporaneous agreement (“Relator Share Agreement”) setting forth Relator’s share under 31 U.S.C. § 3730(d). Conditioned upon full and prompt receipt of
Relator’s share as set forth in the Relator Share Agreement, the Relator, for himself and for his heirs, successors, attorneys, agents, representatives and assignees, in full settlement of any claims such Relator may have under this Agreement,
releases and forever discharges the United States, its officers, agents, and employees, from any claims arising from or relating to 31 U.S.C. § 3730, from any claims arising from the filing of the Civil Action, and from any other claims for a
share of the Settlement Amount, 
  

					
	Schumann	  	9	  	

 that such Relator ever had, has or may have had. This Agreement does not resolve or in any manner affect any claims the
United States has or may have against the Relator arising under Title 26, U.S. Code (Internal Revenue Code), or any claims arising under this Agreement. 
 9. Relator and Medco have entered into a separate agreement (“Relator-Medco Agreement”) setting forth amounts to be paid to Relator for expenses, attorneys fees and costs pursuant to 31 U.S.C. §
3730(d). Conditioned upon receipt of the payment described in the Relator-Medco Agreement, without in any way limiting the terms of Paragraph 3 above, the Relator, for himself and for his heirs, successors, attorneys, agents, representatives and
assignees releases and forever discharges the Medco Released Parties from any and all claims that any such Relator Releasor ever had, has or may have in respect of any liability to the Relator under 31 U.S.C. § 3730(d) for expenses or attorneys
fees and costs. 
 10. Medco waives and will not assert any defenses that Medco may have to any criminal prosecution or administrative action
relating to the Covered Conduct not otherwise released pursuant to the terms hereof that may be based in whole or in part on a contention that, under the Double Jeopardy Clause in the Fifth Amendment of the Constitution, or under the Excessive Fines
Clause in the Eighth Amendment of the Constitution, this Agreement bars a remedy sought in such criminal prosecution or administrative action. Nothing in this Paragraph or any other provision of this Agreement constitutes an agreement by the United
States concerning the characterization of the Settlement Amount for purposes of the Internal Revenue laws, Title 26 of the United States Code. 
 11. Medco (the “Medco Releasor”) releases and forever discharges the United States, its agencies, employees, servants and agents, as well as the Relator and his heirs, successors, attorneys, agents, representatives and assignees
(collectively, the “Relator Releasees”) from any and all claims that the Medco Releasor ever had, has or may have relating to the Covered Conduct in the United States’ and the Relator’s investigation and prosecution thereof.

 12. The Settlement Amount shall not be decreased as a result of the denial of claims for payment now being withheld from payment by any
Medicare carrier or intermediary, TRICARE carrier or payer, FEHBP carrier or payer, or any state payer, related to the Covered Conduct; and Medco shall not 
  

					
	Schumann	  	10	  	

 resubmit to any Medicare carrier or intermediary, TRICARE carrier or payer, FEHBP carrier or payer, or any state payer
any previously denied claims related to the Covered Conduct, and shall not appeal any such denials of claims. 
 13. Medco agrees to the
following: 
 a. Unallowable Costs Defined: All costs (as defined in the Federal Acquisition Regulation, 48 C.F.R. § 31.205-47; and in
Titles XVIII and XIX of the Social Security Act, 42 U.S.C. §§ 1395-1395hhh and l396-l396y; and the regulations and official program directives promulgated thereunder) incurred by or on behalf of Medco, its present or former officers,
directors, employees, shareholders, and agents in connection with the following shall be “unallowable costs” on government contracts and under the Medicare Program, Medicaid Program, TRICARE Program, and Federal Employees Health Benefits
Program (FEHBP): 
 i. the matters covered by this Agreement; 
 ii. the United States’ audit(s) and civil investigation(s) of the matters covered by this Agreement; 
 iii. Medco’s investigation, defense, and corrective actions undertaken in response to the United States’ audit(s) and civil investigation(s) in connection with the matters covered by this Agreement and implementation of the 2004
Consent Order; 
 iv. the negotiation and performance of this Agreement; 
 v. the payment Medco makes to the United States pursuant to this Agreement and any payments that Medco may make to Relator, including costs and
attorneys fees; and 
 vi. the negotiation of, and obligations undertaken pursuant to the CIA to: 
 (a) retain an independent review organization to perform annual reviews as described in Section III of the CIA; and 
 (b) prepare and submit reports to the OIG-HHS. 
 However,
nothing in this Paragraph l3.a.(vi) that may apply to the obligations undertaken pursuant to the CIA affects the status of costs that are not allowable based on any other authority applicable to Medco, (All costs described or set forth in this
Paragraph l3.a. are hereafter “unallowable costs.”) 
  

					
	Schumann	  	11	  	

 b. Future Treatment of Unallowable Costs: These unallowable costs shall be separately determined and
accounted for by Medco, and Medco shall not charge such unallowable costs directly or indirectly to any contracts with the United States or any State Medicaid program, or seek payment for such unallowable costs through any cost report, cost
statement, information statement, or payment request submitted by Medco or any of its subsidiaries or affiliates to the Medicare, Medicaid, TRICARE, or FEHBP Programs. 
 c. Treatment of Unallowable Costs Previously Submitted for Payment: Medco further agrees that within 90 days of the Effective Date of this Agreement it will identify to applicable Medicare and TRICARE fiscal
intermediaries, carriers, or contractors, and Medicaid and FEHBP fiscal agents, any unallowable costs (as defined in this Paragraph) included in payments previously sought from the United States, or any State Medicaid program, including payments
sought in any cost reports, cost statements, information reports, or payment requests already submitted by Medco or any of its subsidiaries or affiliates, and shall request, and agree, that such cost reports, cost statements, information reports, or
payment requests, even if already settled, be adjusted to account for the effect of the inclusion of the unallowable costs. Medco agrees that the United States, at a minimum, shall be entitled to recoup from Medco any overpayment plus applicable
interest and penalties as a result of the inclusion of such unallowable costs on previously-submitted cost reports, information reports, cost statements, or requests for payment. 
 Any payments due after the adjustments have been made shall be paid to the United States pursuant to the direction of the Department of Justice or the
affected agencies. The United States reserves its rights to disagree with any calculations submitted by Medco or any of its subsidiaries or affiliates on the effect of inclusion of unallowable costs (as defined in this Paragraph) on Medco’s or
any of its subsidiaries’ or affiliates’ cost reports, cost statements, or information reports. 
 d. Nothing in this Agreement
shall constitute a waiver of the rights of the United States to audit, examine, or re-examine Medco’s books and records to determine that no unallowable costs have been claimed in accordance with the provisions of this Paragraph. 
 14. Medco agrees to cooperate fully and truthfully with the United States’ investigation, if any, 
  

					
	Schumann	  	12	  	

 of individuals and entities not released in this Agreement. Upon reasonable notice, Medco shall (a) make reasonable
efforts to facilitate access to, and encourage the cooperation of it directors, officers, and employees for interviews and testimony, consistent with the rights and privileges of such individuals, (b) furnish to the United States, upon
reasonable request, any non-privileged documents in its possession, custody or control; and (c) make commercially reasonable efforts to cause any attorneys, auditors, investment bankers, or consultants engaged by Medco to furnish to the United
States, upon reasonable request, any non-privileged documents in the possession, custody or control of any such third party. Medco and the United States will cooperate in good faith to avoid duplicate production of documents. 
 15. Medco agrees that it shall not seek payment for any of the monies owed under this Agreement from any health care beneficiaries or their parents,
sponsors, legally responsible individuals, or third-party payers. Medco waives any causes of action against these beneficiaries or their parents, sponsors, legally responsible individuals, or third party payers based upon the claims for payment
covered by this Agreement. Medco waives and shall not seek payment for any of the health care billings covered by this Agreement from any health care beneficiaries or their parents, sponsors, legally responsible individuals, or third party payers
based upon the claims defined as Covered Conduct 
 16. Relator hereby covenants and agrees in respect of himself and all other Relator
Releasors (with the exception of Relator’s counsel Robins, Kaplan, Miller & Ciresi L.L.P.), on whose behalf he acts hereby that (a) no such Relator Releasor will file or participate as a class member in any class action against
any of such Relator Releasor’s respective Relator Releasees in respect of any such released claim in connection with the Covered Conduct (each a “Class Action”); and (b) if involuntarily included in any such Class Action as a
putative class member each Relator Releasor will opt out upon Medco’s written request from any such Class Action. 
 17. Except as
expressly set forth in Paragraphs 2, 3, 4, 5, 6, 8, 9 and 11 above, this Agreement is intended to be for the benefit of the Parties only, and no Party releases, waives or otherwise discharges, and each Party expressly reserves, any claims such Party
may have against any other person or entity. 
  

					
	Schumann	  	13	  	

 18. Nothing in this Agreement shall constitute a waiver of the rights of the United States set forth in
the 2004 Consent Order, nor shall this Agreement in any way relieve Medco of any of its obligations as set forth in the 2004 Consent Order. No waiver by any Party hereto of any one or more breaches or defaults by the other Party in the performance
of any of the provisions of this Agreement shall operate or be construed as a waiver of any future breaches or defaults, whether of a like or different nature. No failure or delay on the part of any Party in exercising any right, power or remedy
hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right, power or remedy preclude any other or further exercise thereof or the exercise of any other right, power or remedy. No Party shall be required
to give notice to enforce strict adherence to all terms of this Agreement. 
 19. Medco warrants that it has reviewed its respective
financial situations and that it currently is solvent within the meaning of 11 U.S.C. §§ 547(b)(3) and 548(a)(1)(B)(ii)(I), and will remain solvent following payment to the United States of the Settlement Amount. Further, the Parties
warrant that, in evaluating whether to execute this Agreement, they (a) have intended that the mutual promises, covenants, and obligations set forth constitute a contemporaneous exchange for new value given to Medco, within the meaning of 11
U.S.C. § 547(c)(1); and (b) conclude that these mutual promises, covenants, and obligations do, in fact, constitute such a contemporaneous exchange. Further, the Parties warrant that the mutual promises, covenants, and obligations set
forth herein are intended to and do, in fact, represent a reasonably equivalent exchange of value that is not intended to hinder, delay, or defraud any entity that Medco was or became indebted to on or after the date of this transfer, within the
meaning of 11 U.S.C. § 548(a)(1). 
 20. Except as expressly provided to the contrary in this Agreement and allowed by law, each Party
shall bear its own legal and other costs incurred in connection with this matter, including the preparation and performance of this Agreement. 
 21. Medco represents that this Agreement is freely and voluntarily entered into without any degree of duress or compulsion whatsoever. 
 22. Relator Schumann represents that this Agreement is freely and voluntarily entered into without any degree of duress or compulsion whatsoever. 
  

					
	Schumann	  	14	  	

 23. This Agreement is governed by the laws of the United States. The Parties agree that the exclusive
jurisdiction and venue for any dispute arising between and among the Parties under this Agreement is the United States District Court for the Eastern District of Pennsylvania, except that disputes arising under the CIA shall be resolved exclusively
under the dispute resolution provisions in the CIA. 
 24. This Agreement, together with the Interest Letter, the CIA, the 2004 Consent
Order, the Relator Share Agreement and the Relator-Medco Agreement, constitutes the complete agreement between the Parties with respect to the subject matter hereof and thereof and supersedes all prior oral or written communications between or among
the Parties or any of their affiliates regarding the subject matter hereof and thereof. This Agreement may not be amended except by written consent of the Parties, provided, however, that (a) only Medco, OlG-OPM and OIG-HHS must
agree in writing to any modification of the CIA; (b) only the Relator and the United States must agree in writing to any modification of the Relator Share Agreement; and (c) only the Relator and Medco must agree in writing to any
modification of the Relator-Medco Agreement. 
 25. Promptly following the execution of this Agreement the United States will sign and file a
stipulation dismissing with prejudice the Civil Action as to Medco and any and all allegations pertaining to Medco as set forth in the Covered Conduct (the “Stipulation of Dismissal”). 
 26. The individuals signing this Agreement on behalf of Medco represent and warrant that they are authorized by Medco to execute this Agreement. The
individual signing this Agreement on behalf of Relator represents and warrants that such individual is authorized by Relator to execute this Agreement. The United States signatories represent that they are signing this Agreement in their official
capacities and that they are authorized to execute this Agreement. Each Party further warrants and represents that such Party has not assigned or transferred, or purported to assign or transfer, to any person or entity, any claims that such Party
has or may have that are subject to this Agreement. 
 27. This Agreement may be executed in counterparts, each of which constitutes an
original and all of which constitute one and the same Agreement. Facsimiles of signatures shall constitute acceptable, binding signatures for purposes of this Agreement. 
  

					
	Schumann	  	15	  	

 28. This Agreement is binding on Medco’s successors, transferees, heirs, and assigns. 
 29. This Agreement is binding on the Relator’s successors, transferees, heirs, and assigns. 
 30. All Parties consent to the disclosure of this Agreement, and information about this Agreement, to the public. 
 31. The term “Effective Date” as used herein shall refer to the latest of the following dates: (a) the date that the last signatory to the
Agreement has executed the Agreement; and (b) the date that the Court enters the Stipulation of Dismissal. In the event that this Agreement does not become effective, this Agreement shall be treated as materials received pursuant to Fed. R.
Evid. 408. 
 32. All recitals are incorporated herein as material provisions of this Agreement. The captions and headings of the Sections of
this Agreement are for convenience of reference only and are not to be considered in construing this Agreement. Unless the context of this Agreement clearly requires otherwise: (a) references to the plural include the singular, the singular the
plural, and the part the whole, (b) references to one gender include all genders, (c) “or” has the inclusive meaning frequently identified with the phrase “and/or,” (d) “including” has the inclusive
meaning frequently identified with the phrase “including but not limited to” or “including without limitation,” (e) references to “hereunder,”“herein” or “hereof’ relate to this Agreement as a
whole, and (f) the terms “dollars” and “$” refer to United States dollars. Section and subsection references are to this Agreement as originally executed unless otherwise specified. Any reference herein to any person shall
be deemed to include the heirs, personal representatives, successors and permitted assigns of such person. Any reference herein to a corporate entity shall be deemed to include the entity’s past and present parents, subsidiaries, affiliates,
predecessors, and successors and each of the assigns of any of the foregoing. 
 34. In the event that any provision or portion of this
Agreement shall be determined to be invalid or unenforceable for any reason, the remaining provisions of this Agreement shall be unaffected thereby and shall remain in full force and effect. 
 35. Each Party agrees that the United States District Court for the Eastern District of Pennsylvania shall retain jurisdiction to enforce the Agreement.

  

					
	Schumann	  	16	  	

 [SIGNATURES APPEAR ON FOLLOWING PAGES] 
  

					
	Schumann	  	17	  	

 IN WITNESS WHEREOF, the Parties have executed this Agreement as of the
                     day of
                    , 2006. 
  

					
		 	THE UNITED STATES OF AMERICA
			
	DATED: 10/23/06	 	BY:	 	 /s/ JAMES G. SHEEHAN

		 		 	PATRICK L. MEEHAN
		 		 	Unitetd States Attorney
		 		 	JAMES G. SHEEHAN
		 		 	Associate United States Attorney

  

					
	Schumann	  	18	  	

					
	DATED: 10-23-06	 	BY:	 	 /s/ DAVID T. SHAPIRO

		 		 	JOYCE R. BRANDA
		 		 	Deputy Director
		 		 	MICHAL L. TINGLE
		 		 	DAVID T. SHAPIRO
		 		 	Trial Attorneys
		 		 	Commercial Litigation Branch
		 		 	Civil Division
		 		 	United States Department of Justice

  

					
	Schumann	  	19	  	

					
	DATED: 10/23/06	 	BY:	 	 /s/ GREGORY E. DEMSKE

		 		 	GREGORY E. DEMSKE
		 		 	Assistant Inspector General for Legal Affairs
		 		 	Office of Counsel to the Inspector General
		 		 	Office of Inspector General
		 		 	United States Department of Health and Human Services

  

					
	Schumann	  	20	  	

					
	DATED:                     	 	BY:	 	  
		 		 	LAUREL C. GILLESPIE
		 		 	Deputy General Counsel
		 		 	TRICARE Management Activity
		 		 	United States Department of Defense

  

					
	Schumann	  	21	  	

					
	DATED: 10/20/06	 	BY:	 	 /s/ KATHLEEN McGETTIGAN

		 		 	KATHLEEN McGETTIGAN
		 		 	Deputy Associate Director
		 		 	Center for Retirement & Insurance Services
		 		 	United States Office of Personnel Management

  

					
	Schumann	  	22	  	

					
	DATED: 10/20/2006	 	BY:	 	 /s/ J. DAVID COPE

		 		 	J. DAVID COPE
		 		 	Assistant Inspector General for Legal Affairs
		 		 	United States Office of Personnel Management

  

					
	Schumann	  	23	  	

					
		 	MEDCO HEALTH SOLUTIONS, INC.
			
	DATED: 23 Oct 2006	 	BY:	 	 /s/ ELIZABETH S. FERGUSON

		 		 	ELIZABETH S. FERGUSON
		 		 	Vice President, Litigation and Government Programs
			
	DATED: 23 Oct 2006	 	BY:	 	 /s/ WILLIAM McDANIELS

		 		 	WILLIAM McDANIELS
		 		 	Counsel for Medco Health Solutions, Inc.

  

					
	Schumann	  	24	  	

					
	RELATOR	 	
			
	DATED: 10/22/2006	 	BY:	 	 /s/ W. SCOTT SIMMER

		 		 	W. SCOTT SIMMER., ESQ.
		 		 	Robins Kaplan Miller & Ciresi LLP
			
	DATED: 10/20/06	 	BY:	 	 /s/ KARL S. SCHUMANN

		 		 	KARL S. SCHUMANN
		 		 	Relator

 Civil Action 03-5423

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