SAM BERNSTEIN LAW FIRM SUES PHARMACEUTICAL COMPANIES OVER EXORBITANT INSULIN COSTS

As part of our ongoing commitment to protect victims of corporate greed and malfeasance, The Sam Bernstein Law Firm filed lawsuits against several of the world’s largest pharmaceutical manufacturers and pharmacy benefit managers (PBMs) over their illegal pricing activities and excessive charges for insulin medications.

The Sam Bernstein Law Firm is representing Washtenaw County and Macomb County, while Wayne County and Monroe County are represented by the Miller Law Firm. All four municipalities are seeking reimbursement of excessive payments made on behalf of their employees and retirees. The lawsuits from the four counties combined cover approximately 3.2 million people, about one-third of Michigan’s residents.

The first of their kind in Michigan, the Federal lawsuits target pharmaceutical manufacturers Eli Lilly, Sanofi, and Novo Nordisk and pharmacy benefit managers (PBMs) Express Scripts, CVS Health, and OptumRx. The complaint alleges the defendants engaged in illegal collusion and price-setting to artificially inflate the cost of their insulin products.

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WHAT IS THE BASIS FOR THE LAWSUITS?

An exponential rise in insulin prices over the past decade that far exceeded inflation rates led the U. S. Senate Finance Committee to launch an investigation into the pricing policies of several major drug manufacturers and pharmacy benefit managers (PBMs).  

The inquiry focused on insulin because it is an essential medication for millions of people living with diabetes, a potentially life-threatening disease. In Michigan alone, an estimated 1 million people have been diagnosed with diabetes, while almost 3 million more have prediabetic glucose levels.

Investigators examined the processes used by pharmaceutical manufacturers to determine the cost of insulin medication and the financial relationships and contracts between these companies and major pharmacy benefit managers (PBMs) such as CVS Health, Express Scripts and OptumRx. According to the Senate report, more than 200 million people were covered by these three PMBs as of 2019, almost two-thirds of the U.S. population.

Over the course of two years, researchers reviewed more than 100,000 pages of internal company documents obtained from the defendants. The resulting report revealed a complex web of illegal pricing policies designed to drive up insulin costs, including anti-competitive collusion as defined by the Federal RICO (Racketeer Influenced and Corrupt Organizations) Act and other Michigan statutes.

IMPORTANT DATA ABOUT DIABETES

Diabetes has been described as a national epidemic, affecting almost 40 million people nationwide, or nearly 12 percent of the U.S. population. More than one million new cases are diagnosed every year and an estimated 97 million people are considered pre-diabetic.

According to statistics from the American Diabetes Association, this potentially life-threatening disease is equally prevalent in Michigan.  

• Approximately 964,964 Michigan residents, or more than 12 percent of the adult population have been diagnosed with diabetes
•  An estimated 239,000 people in Michigan have undiagnosed diabetes, a serious health risk  
•  About 2,701,000 Michiganders, or 34.7 percent of the adult population, have blood glucose levels high enough to be considered pre-diabetic
• Every year, around 59,201 new cases of diabetes are diagnosed in Michigan

WHAT ARE THE ALLEGATIONS AGAINST THE DRUG COMPANIES? 

The lawsuits provide details on the processes used by the drug manufacturers and PBMs that resulted in the municipalities and other payers spending twice as much for insulin claims despite a marginal increase in use of the medications.

Here are some of the main points outlined in the legal complaints:

• The drug manufacturers have complete control over the prices (known as wholesale acquisition cost (WAC) of their medications.
• These companies increased prices to allow for larger rebates and incentives to the PBMs in order to receive preferred placement on their formularies.
• PBMs earn administrative fees based on the WAC price of a drug, discouraging them from lowering list prices.
• The three PBMs named in the lawsuit have enormous power to negotiate rebates compared to smaller companies.
• PBMs exerted pressure on the drug manufacturers to offer increased discounts and rebate programs in order to maintain preferred status formulary exclusion lists.
• Drug manufacturers and PBMs engaged in an intricate series of negotiations resulting in confidential contracts with minimal transparency and oversight.
• The drug manufacturers engaged in “shadow pricing,” mirroring their competitors’ price increases instead of undercutting them.
• While rebates for insulin have grown rapidly in the past 10 years compared to other medications, these programs have not reduced the cost of insulin products.

WHAT RESULTS ARE THE MUNICIPALITIES HOPING TO ATTAIN?

The plaintiffs and their attorneys intend to achieve the following outcomes:

• The defendants will reimburse the municipalities for the years of outrageous overcharges
• The drug manufacturers and PBMs will lower insulin prices and cease their shadowy price-setting activities
• Going forward, the defendants will provide transparency to their customers and the public

WE FIGHT CORPORATE GREED SO OUR CLIENTS WIN THE COMPENSATION THEY DESERVE

If you are a victim of corporate greed or negligence, we can help. The Sam Bernstein Law Firm has a long history of fighting against companies that put profits before people, and we are proud to protect the rights of those they harm.

“We look forward to holding these corporations accountable for their illegal actions and winning the compensation our clients deserve,” said Mark Bernstein, CEO and Managing Partner of The Sam Bernstein Law Firm. “These lawsuits exemplify our long-standing commitment to fight against companies that take advantage of our most vulnerable citizens.”

Our experienced legal team has the skills and resources to build a successful case, and we will fight to win the compensation you and your family deserve.

Personal injury law is complicated, but finding the right personal injury lawyer is simple.

Get your case started today by filling out the brief form below or calling 1-800-CALL-SAM for a free, no-obligation consultation with a member of our legal team.

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