Kansas Attorney General (AG) Derek Schmidt filed a lawsuit Dec. 2 against three insulin manufacturers claiming they violated the state’s Consumer Protection Act by scheming to impose price hikes, the Kansas AG’s office stated. These insulin manufacturers control nearly 100% of the life-saving diabetes drug market.
The lawsuit says that because of the alleged price scheming, Kansans are forced to pay excessive costs for insulin in order to control their diabetes, and also names several pharmacy benefit managers (PBM) as defendants: CVS Health Corporation, CVS Pharmacy, Inc., Caremark Rx, LLC, Caremark, LLC, CaremarkPCS Health, LLC, Evernorth Health, Inc., Express Scripts, Inc., Express Scripts Administrators, LLC, Medco Health Solutions, Inc., ESI Mail Pharmacy Service, Inc., Express Scripts Pharmacy, Inc., and OptumRx, Inc.
Eli Lilly and Company, Sanofi-Aventis U.S. LLC, and Novo Nordisk Inc, combined manufacture 99% of the insulin currently on the U.S. market. AG Schmidt alleges that because these three companies inflated the cost of producing insulin, Kansans managing diabetes were forced to choose between “rationing their medication to stretch their healthcare dollars or going without insulin and risking potentially deadly complications.”
The complaint accuses the drug manufacturers of secretly providing PBMs “price back” compensation after the PBMs “granted national formulary status based on the highest inflated price and upon which diabetes medications generate the largest profits for these PBMs.”
The lawsuit says that the alleged insulin price-fixing scheme has been ongoing since 2003.
According to the Kansas AG’s office, “The manufacturers have engaged in deceptive acts and practices as prohibited by the provisions of the Kansas Consumer Protection Act.”
The three insulin manufacturers received “unjust enrichment by knowingly, willfully and intentionally deceiving Kansas diabetics and receiving a financial windfall from the insulin pricing scheme at the expense of Kansas diabetics,” the lawsuit also alleges.
In 2020, the Kansas AG’s office settled a similar lawsuit with the PBM Centene Corp for $27 million.