Texas sues insulin manufacturers, PBMs over insulin prices

Texas Attorney General Ken Paxton announced a lawsuit against insulin manufacturers and pharmacy benefit managers, including Eli Lilly (LLY), Cigna’s (CI) Express Scripts, CVS Pharmacy (CVS), Novo Nordisk (NVO), Sanofi (SNY) and UnitedHealth (UNH), “over a conspiracy to increase prices of insulin.” In a statement, Paxton said, “Through this conspiracy, the manufacturers artificially and willingly raised the prices of insulin then paid a significant, undisclosed portion back to the PBMs as a quid pro quo for inclusion in the PBMs’ standard offerings. The PBMs then granted preferred status to the manufacturer whose drug has the highest list price while excluding lower priced drugs. These synthetic insulin drugs, which today cost the manufacturers less than $2 to produce and were originally priced at $20 when released in the late 1990s, now range between $300 and $700. In the last decade alone, the manufacturers who are defendants in the lawsuit have increased the prices of their insulins up to 1,000%. Attorney General Paxton is suing because the insulin pricing scheme violates the Texas Deceptive Trade Practices Act, constitutes unjust enrichment, and represents an unlawful civil conspiracy.”