Iowa’s lawsuit against NuCara accuses the specialty pharmacy of pocketing more than $22 million that was supposed to fund HIV medications for low-income Iowans. The state filed suit in Polk County District Court on March 6, 2026, against NuDak Ventures, NuCara’s parent company, the same day it terminated a contract that had run since 1998.1Des Moines Register. Iowa Sues Pharmaceutical Firm Within days, more than 1,100 people were placed on a waitlist for HIV medication.2HIV-HCV Watch. Iowa ADAP Crisis Coverage
What Iowa Is Alleging
The petition brings two counts: breach of contract and conversion. Iowa HHS says NuCara stopped making its required monthly payments in October 2024 and, by January 2026, was eight months in arrears on more than $22 million.3Iowa Capital Dispatch. State Says Its Owed $22 Million by Company Managed in Part by Legislator
The state’s more serious charge is conversion. According to the petition, NuCara did not merely hold the funds — it used them to pay other creditors and “no longer has, and is unable to return” the money.4WHO13. NuCara Petition at Law and Jury Demand Iowa is seeking the full $22 million plus interest and legal costs, and has demanded a jury trial.
How the Money Was Supposed to Flow
NuCara served as the contract pharmacy for Iowa’s Ryan White Part B Benefits and Drug Assistance Program, dispensing HIV medications and drugs for tuberculosis, STI services, and immunizations.1Des Moines Register. Iowa Sues Pharmaceutical Firm The arrangement ran on the federal 340B Drug Pricing Program, which forces manufacturers to sell outpatient drugs at deep discounts to qualifying entities.
NuCara bought medications at the discounted 340B price and billed patients’ insurance at the standard rate. The difference, called program income in the contract, was supposed to move back to Iowa HHS every month. Federal rules at 2 C.F.R. § 200.307 require that program income tied to federal grants be reinvested in the grant’s purpose.4WHO13. NuCara Petition at Law and Jury Demand NuCara kept a $75 processing fee per claim for handling the transactions.5Yahoo News. Pleasant Hill Pharmacy Accused of Keeping State Funds
The 1,106 Patients on the Waitlist
On March 9, 2026, three days after terminating the contract, Iowa implemented a waitlist for its AIDS Drug Assistance Program that included 1,106 people.2HIV-HCV Watch. Iowa ADAP Crisis Coverage
Iowa’s ADAP relied heavily on 340B rebate revenue and received no state general revenue. The $22 million allegedly withheld exceeded Iowa’s entire fiscal year 2023 ADAP budget of roughly $13 million.2HIV-HCV Watch. Iowa ADAP Crisis Coverage Without those monthly payments, the state had no cushion to cover drug costs for enrolled participants.
The Sitting Lawmaker at NuCara
State Representative Brett Barker, a Republican from Story County, has been NuCara’s vice president of operations since November 2012, according to his Iowa Legislature profile.6Iowa Legislature. Legislator Profile – Brett Barker He previously spent two years as the company’s director of clinical services and sat on the Iowa Board of Pharmacy from May 2017 through December 2021.1Des Moines Register. Iowa Sues Pharmaceutical Firm
Barker told reporters he learned of the payment problems only when the lawsuit was filed. “I am on the community pharmacy side of the business and that’s a separate division,” he said. “So, I wasn’t aware of anything until there was a lawsuit filed.”7News From the States. State Says Its Owed $22 Million by Company Managed in Part by Legislator
In January 2026, Barker introduced legislation that would have barred drug manufacturers from restricting the delivery of 340B-discounted drugs to contract pharmacies, a measure that would directly benefit firms like NuCara.2HIV-HCV Watch. Iowa ADAP Crisis Coverage
The OneroRx Sale and What’s Left to Recover
NuCara had been in talks with OneroRx before the lawsuit landed. On April 2, 2026, OneroRx completed the purchase of 14 NuCara retail pharmacy locations and 10 NuCara Home Medical stores across Iowa and Minnesota, which began rebranding as Medicap Pharmacy or Medicap Home Medical.8OneroRx. OneroRx Inc Completes Acquisition of NuCara Pharmacy Locations Four Iowa locations in Traer, Ackley, Conrad, and Zearing closed on March 31, 2026.9Sun-Courier. Four Area NuCara Pharmacies Shutter Amid $22M Lawsuit
The sale complicates any recovery. The petition states that OneroRx does not intend to assume NuCara’s existing liabilities and that proceeds from the transaction would be insufficient to repay the program income owed.4WHO13. NuCara Petition at Law and Jury Demand In a March 27, 2026 statement, NuCara attributed its closures to “prescriptions reimbursed below our cost to dispense” and “gaps in Iowa’s rural healthcare strategy,” and said it was “evaluating strategic alternatives” for its remaining locations.9Sun-Courier. Four Area NuCara Pharmacies Shutter Amid $22M Lawsuit
Where the Case Stands
As of the most recent reporting in mid-2026, NuCara had not filed a formal response to the petition.1Des Moines Register. Iowa Sues Pharmaceutical Firm No bankruptcy filing by NuDak Ventures has been reported. The case remains pending in Polk County District Court, with the state pursuing the full $22 million plus interest through a jury trial.4WHO13. NuCara Petition at Law and Jury Demand