Already under fire for its insulin pricing, Eli Lilly faces a pair of new investigations by state attorneys general.
In a securities filing, Lilly disclosed that the Washington state attorney general is investigating “the pricing of our insulin products and our relationships with pharmacy benefit managers,” while the New Mexico investigation focuses solely on insulin pricing.
Indianapolis-based Eli Lilly says it’s cooperating with both probes.
The company’s disclosure comes shortly after the nonprofit group Type 1 Diabetes Defense Foundation sued Lilly, plus peers Sanofi and Novo Nordisk, for their insulin pricing. That suit also named as defendants top pharmacy benefit managers, which negotiate drug rebates on behalf of insurers.
According to the nonprofit’s claims in that case, the companies raised their insulin prices in lockstep over many years, benefiting PBMs along the way with bigger rebates. The Washington state probe appears to be digging into the same issues.
Separately, the three leading insulin makers face a class action lawsuit claiming that they joined in an “arms race” to raise list prices. The “real” price to PBMs stayed constant or in some cases dipped despite the price hikes, the class action suit says.
In response to that lawsuit, filed back in January, Lilly said in a statement that it “conducts business in a manner that ensures compliance with all applicable laws, and we adhere to the highest ethical standards.”
Eli Lilly has also taken criticism from Sen. Bernie Sanders, I-Vt., and Rep. Elijah Cummings, D-Md., who’ve castigated the industry’s pricing on several occasions during the last year. Back in November, the congressmen called for an investigation over insulin price fixing, but Lilly denied any wrongdoing.
Lilly disclosed the new investigations as part of its first-quarter 10-Q filing with the Securities and Exchange Commission. During the quarter, the company’s once-weekly GLP-1 diabetes med Trulicity had a strong performance, helping the drugmaker notch 7% growth for the period. Humalog sales grew 17% to $708 million.
But sales of insulin therapy Humulin fell 12% during the quarter, and uptake for SGLT2 med Jardiance “remains below our expectations,” Credit Suisse analysts wrote after the company reported results.