Eli Lilly & Co., Novo Nordisk AS and Sanofi were sued by California over insulin prices, which the state claims are inflated through unfair and deceptive practices and disproportionately affect low-income households and people of color.
The suit filed Thursday also claims pharmacy benefit managers CVS Caremark, Express Scripts, and OptumRx as well as the drug makers “have leveraged their market power to overcharge patients,” according to a statement from Attorney General Rob Bonta’s office.
“Insulin is a necessary drug that millions of Americans rely upon for their health, not a luxury good,” Bonta said. “With today’s lawsuit, we’re fighting back against drug companies and PBMs that unacceptably and artificially inflate the cost of life-saving medication at the expense of vulnerable patients.”
The legal action comes as the drug makers and pharmacy benefit managers have been hit with similar suits by consumers and states such as Arkansas. The complaints accuse the drug companies of pushing up the list price of insulin while large rebates keep actual prices negotiated by pharmacy benefit managers — middlemen who decide what’s covered through insurance plans — flat.
The three manufacturers produce about 90% of insulin globally while the three PBMs administer benefits for about 80% of prescription claims, Bonta said.
CVS denied any wrongdoing.
“Allegations that we play any role in determining the prices charged by manufacturers are false,” CVS said in an emailed statement. “Nothing in our agreements prevents drug manufacturers from lowering the prices of their insulin products and we would welcome such action.”
Novo Nordisk declined to comment on the lawsuit. The other companies didn’t immediately respond to requests for comment.
List prices for insulin have risen several hundred percent over the last two decades, with diabetics who require the drug and who are exposed to the full price, such as those with no insurance or high deductibles, paying thousands of dollars a year, the state said in the complaint, filed Thursday in state court in Los Angeles.
“The United States insulin market is an oligopoly,” the state said in the complaint.
“A vial of insulin was $25 a couple of decades ago,” Bonta said at a press conference announcing the legal action. “Today it’s $300, and who suffers the most from these unscrupulous business practices: people from low income households, communities of color, working families struggling to make ends meet.”
The state sued to limit the “skyrocketing” insulin rates by encouraging competition and is seeking restitution for Californians who have overpaid for the drug, according to Bonta’s statement.
The case is People of the State of California v. Eli Lilly & Co., Superior Court, State of California (Los Angeles).
