Texas Attorney General Ken Paxton claims that through an alleged kickback scheme Eli Lilly “fraudulently sought to maximize profits at taxpayer expense.”
The State of Texas has sued Eli Lilly, claiming that the pharma “offered illegal incentives” to healthcare providers, pushing them to prescribe blockbuster GLP-1 drugs Zepbound and Mounjaro.
In a prepared statement on Tuesday, Attorney General Ken Paxton alleged that Lilly “compromised medical decision-making by engaging in an illegal kickback scheme.”
“Eli Lilly fraudulently sought to maximize profits at taxpayer expense and put corporate greed over people’s health,” Paxton added.
The 24-page complaint, filed in the District Court of Texas, claimed that Lilly ran two programs to incentivize providers to prescribe its products, allowing it to “compete in a marketplace saturated with medications that deliver—or claim to deliver—similar therapeutic results.”
The first scheme, which the lawsuit dubbed the “Free Nurse Program,” involved providing “free patient-care services” to providers, in order to nudge them into prescribing the company’s drugs. Under the second program, called the “Support Services Program,” Lilly offered assistance for reimbursement, the complaint claims. Aside from Zepbound and Mounjaro, the lawsuit also covers many other Lilly products, Including the breast cancer drug Verzenio, the leukemia pill Jaypirca and injectable insulin drugs Insulin Lispro and Lyumjev.
Paxton is requesting a trial by jury and is looking for Lilly to cover civil recoveries and other penalties, as well as an injunction against “further unlawful acts,” the lawsuit read.
In a statement to Fierce Pharma, a spokesperson for Eli Lilly denied the charges and said that the company will “vigorously defend” itself against the allegations. The spokesperson also noted that “multiple courts and federal governments have rejected claims by this same corporate realtor against Lilly as meritless.”
The spokesperson was referring to Health Choice Alliance, a New Jersey-based realtor that is named as a co-plaintiff in the Texas suit. In 2017, Health Choice Alliance sued Lilly alleging that the pharma violated the Anti-Kickback Statute and the False Claims Act. The case was eventually dismissed.
For Texas, this latest lawsuit follows a similar complaint mounted last October, alleging that Lilly, along with other insulin manufacturers and pharmacy benefit managers (PBM), worked together to “artificially and willingly” raise the prices of insulin, with manufacturers paying a “significant, undisclosed” fee to the middlemen for their products to be included in the PBMs’ offerings.
Paxton at the time called the scheme a “disturbing conspiracy” in which insulin manufacturers and PBMs “worked together to take advantage of diabetes patients and drive prices as high as they could.”
