Eli Lilly damages tripled to $184M in Medicaid rebate fraud case

When a federal jury last year ordered Eli Lilly to pay $61 million for skimping out on Medicaid rebates, the company vowed to fight the verdict. But instead of the result Lilly wanted, the award has been tripled to more than $183 million.

On Tuesday, Illinois federal judge Harry Leinenweber ruled that Eli Lilly owes triple damages from last year's award after whistleblower Ronald Streck convinced a jury that the company violated the False Claims Act and short-changed Medicaid on rebate payments.

Since the case falls under the False Claims Act, the award was eligible for "trebled" damages, according to court filings.

The case dates to 2014, when whistleblower Streck—a pharmacist and lawyer—sued Eli Lilly for allegedly launching retroactive price increases and failing to pay Medicaid rebates based on the higher prices.

Streck and his attorneys moved forward with litigation in 2018 after the U.S. government declined to intervene in the case, Streck’s law firm said last year.

In the order Tuesday, Leneinweber pointed out that Lilly “changed its practices years before the trial.” In court, Lilly argued its corrective actions weighed in favor of “minimal, if any, penalties," according to the document.

Still, Leneinweber decided that the company indeed owes $183.69 million under the "trebled" damages rules in the False Claims Act. The judge ultimately noted that “while Lilly could have, of course, behaved better, it could have acted far worse.”

Lilly, for its part, said it's "committed to upholding high standards of corporate conduct in our business dealings." The company is "disappointed" with the outcome, but it plans to appeal and is "confident that the Seventh Circuit will reverse," a spokesperson said over email.

Streck also filed a False Claims Act whistleblower suits against Bristol Myers Squibb and other companies in 2013 but later withdrew his claims against the other defendants. BMS ultimately settled for $75 million in 2021 while Astellas Pharma’s U.S. unit resolved its case for $18 million that same year.

Editor's note: This story has been updated with comments from Eli Lilly.