Rep. Brett Barker (R-Nevada) spoke in support of a bill sent to Gov. Kim Reynolds May 12, 2025 restricting certain business practices by pharmacy benefit managers in an effort to aid rural and independent pharmacies. PHOTO BY ROBIN OPSAHL/IOWA CAPITAL DISPATCH

DES MOINES – The State of Iowa is suing a pharmaceutical firm that is managed in part by a state legislator, alleging the company has spent $22 million owed to the state for an HIV treatment program.

NuDak Ventures, a limited liability corporation that does business as NuCara Specialty Pharmacy, is being sued by the state in Polk County District Court. NuCara owns and manages more than 30 full-service, community-based pharmacies in Iowa, Texas, North Dakota and Minnesota. (Sun Courier Note: NuCara company pharmacies operating locally include Conrad, Grundy Center, Marshalltown, and Traer.)

In its lawsuit, the State of Iowa alleges the company has repeatedly failed to make millions in monthly payments due to the state under a contract with the Iowa Department of Health and Human Services.

Iowa Rep. Brett Barker, a Republican from Story County, is vice president of operations for NuCara. When asked about the $22 million the company allegedly owes the state, Barker said Monday, “There is no knowledge that I have into what’s been going on, so I don’t have anything to add … I don’t have anything to do with that. I am on the community pharmacy side of the business and that’s a separate division. So, I wasn’t aware of anything until there was a lawsuit filed.”

NuCara’s website indicates Barker began serving as the company’s vice president of operations in November 2012, having previously served as director of clinical services for two years.

State records show Barker also served as a member of the Iowa Board of Pharmacy from May 2017 to December 2021.

The lawsuit, filed in Polk County District Court, states that until recently NuCara was a state-contracted pharmacy, providing pharmacy services related to sexually transmitted diseases, tuberculosis control, immunization, and substance abuse treatment since 1998.

NuCara company also provided services related to a federal AIDS drug program established by Congress in 1990, according to the company’s contracts with the state. As part of that program, the federal government has provided states with money to improve access to HIV medical care and support services. Iowa has used its share of that revenue to operate the Iowa AIDS Drug Assistance Program, which provides critical medications, treatment, and assistance with health insurance costs to low-income Iowans, the contacts show.

Under the federal law, the program requires pharmaceutical manufacturers to sell outpatient drugs at discounted prices to Iowa DHHS. If patient-clients in the program have health insurance, the law allows DHHS to generate program income by purchasing the medications at the discounted rates while billing insurers at the standard, non-discounted rate. The resulting “profit” is then reinvested in the program itself.

As part of its contract with the state, NuCara was tasked with ordering the outpatient medications purchased by DHHS at discounted prices. Under the terms of that deal, NuCara was responsible for paying DHHS the program “profit” that was generated each month.

On March 6, 2026, the state terminated its contract with NuCara, alleging that between October 2024 and January 2026 the company had repeatedly failed to make all of the required monthly payments.

NuCara is now alleged to be eight months in arrears, totaling more than $22 million in money owed to the state.

NuCara is also alleged to have improperly spent the state’s program income to pay off other creditors in violation of the contract and state and federal laws, and the state claims the company “no longer has, and is unable to return,” the state’s lost revenue.

While NuCara is reportedly pursuing a corporate acquisition by OneroRX, the state alleges that OneroRX does not intend to accept NuCara’s liabilities as part of any proposed corporate acquisition. “Even if NuCara is acquired by OneroRX, the proceeds from the sale and collection on any pending invoices will not be sufficient to repay the program income” the state is due, the lawsuit claims.

The lawsuit alleges breach of contract and conversion, and is seeking reimbursement of all money owed to the state, plus interest.

NuCara has yet to file a response to the lawsuit and company officials did not respond to emails seeking comment on the lawsuit.