AG Schmidt Files Lawsuit Alleging Unlawful Insulin Pricing Scheme

Lori Kalani, Bernard Nash
Cozen O'Connor
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  • Kansas AG Derek Schmidt sued insulin manufacturers Eli Lilly and Company, Sanofi-Aventis U.S. LLC, and Novo Nordisk Inc. and pharmacy benefit managers (PBMs) CVS Health Corporation, Express Scripts, Inc., OptumRx, Inc., and affiliated entities alleging that the companies maintained an insulin pricing scheme that violated the Kansas Consumer Protection Act.
  • According to the complaint, the manufacturer defendants raised the prices of their respective diabetes drugs—which reportedly account for 99 percent of the insulin currently on the U.S. market—over the last fifteen years, even though the costs to produce the drugs decreased during the same time period. AG Schmidt alleges that the PBM defendants—which reportedly make up 3 of the top 5 dispensing pharmacies in the U.S.—granted the manufacturers national formulary status based upon the inflated prices in order to increase their own profits, both through payments made to the PBMs by the manufacturers for the benefits provided by that status, and through the artificially inflated prices paid by consumers for the diabetes medications.
  • The complaint seeks financial restitution, civil penalties, punitive damages, and an injunction prohibiting the defendants from engaging in deceptive and unconscionable trade practices, among other things.

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