Minnesota AG Files Lawsuit Against 3 Top Manufacturers of Insulin for Diabetes

Attorney General Lori Swanson Photo: KSTP/File
Attorney General Lori Swanson

October 16, 2018 03:22 PM

Minnesota Attorney General Lori Swanson Tuesday filed a lawsuit against the nation's three major manufacturers of insulin used to treat diabetes, alleging those companies have deceptively raised the list price of their product, thus making it less affordable to patients in health plans with high deductibles, those without insurance and senior citizens on Medicare.

The average price of insulin tripled between 2002 and 2013, according to the American Medical Association, The Associated Press has reported.

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A release from the attorney general's office alleges the companies - Sanofi-Aventis U.S. LLC, Novo Nordisk, Inc. and Eli Lilly and Co. - "fraudulently set an artificially high 'list' price for their insulin products but then negotiated a lower actual price by paying rebates to pharmacy benefit managers."

A pharmacy benefit manager is a company retained by health plans to negotiate prices with drug companies and develop formularies of approved drugs.

The lawsuit alleges the drug companies establish two prices for their insulin products - the higher list price and the lower net price that insurance companies pay, which is kept confidential. According to the release, the difference between list and net prices paid by pharmacy benefit managers has increased dramatically in recent years.

The lawsuit also claims the list prices being set are so far from the net prices that they do not represent an "accurate approximation of the true cost of insulin and are deceptive and misleading."

A spokesperson for Eli Lilly and Co. said the company was aware of the lawsuit and believes it to be without merit:

"We are aware of the lawsuit filed today against several insulin manufacturers," a statement read. "We believe the claims are without merit, and we will defend against them vigorously. We have no further comment at this time." 

A spokesperson for Novo Nordisk said the company is taking the lawsuit seriously, but could not comment due to the pending nature of the litigation:

"Novo Nordisk Inc. is aware of the Minnesota Attorney General's lawsuit pertaining to the sales and marketing of our insulin products," the statement read. "We take this matter seriously, and are currently examining the allegations made in the complaint.

"As a company committed to ethics and compliance in how we support patients, we ensure that our business practices are consistent with legal and regulatory requirements. Because this is ongoing litigation, we can't provide further comment."

A spokesperson for Sanofi-Aventis issued a statement as well:

"Sanofi is aware of the lawsuit, believes it to be without merit and will vigorously defend against it," the statement read.

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Frank Rajkowski

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