Detroit and surrounding counties sue big pharma over soaring insulin prices
(CBS DETROIT) - The city of Detroit and several other surrounding communities are suing big pharma, claiming the price of insulin is just too high, and price gouging may be to blame.
In its latest budget, Macomb County is set to drop $1.5 million on insulin for their employees and retirees, but in an ideal world, leaders say they wouldn't have to pay that much.
"How do we address this issue to get them to be more competitive with the pricing amongst one another?" Mark Hackel, Macomb County Executive, said.
Macomb County is uniting with the city of Detroit and surrounding counties, suing insulin manufacturers and distributors.
"These are defendants that we believe know that they've done something wrong, and we're holding them accountable for it, and we're gonna get our clients money back for them," Mark Bernstein, managing partner of the Sam Bernstein Law Firm, said.
In lawsuits filed in federal court Wednesday, they accuse companies Eli Lilly and Co., Sanofi-Aventis, and Novo Nordisk of artificially inflating insulin prices.
"When we talk about jacking up the prices, they've jacked him up 1,500% in the last 20 years," said Melvin Butch Hollowell, Managing Partner of the Miller Law Firm Detroit.
They claim that pharmacy benefit managers like CVS Caremark, Evernorth Health, Express Scripts, and OptumRx demanded large rebates from manufacturers, pushing prices up and benefiting from the scheme.
"There are people out there actually foregoing insulin because they can't afford it. There's nothing to show that the cost we pay for it is rationally based to the cost-reducing it, R&D for it, none of those things," said Warren Evans, Wayne County Executive.
In the future, these lawsuits may end up getting consolidated, likely resulting in significant settlements similar to those surrounding the opioid crisis.
"I'm not looking for a check for the city of Detroit. I'm looking for a settlement that allows our residents to be able to afford that treatment," Detroit Mayor Mike Duggan said.
Statements released by companies named in lawsuit
CBS News Detroit reached out to the defendants listed in the lawsuits.
Eli Lilly and Company
"These complaints are baseless and should be dismissed, just like cases brought by other local governments have been. It's the local governments filing these lawsuits—not Lilly—who decide the terms of the rebate arrangements they now say are improper, including whether to pass rebates on to people who take insulin.
Lilly has been working for years to reduce insulin out-of-pocket costs for people with diabetes, against the headwinds of a healthcare system that incentivizes others—like the parties filing these lawsuits—to choose higher list-price medicines over lower-priced options. Lilly was the first and still only company to cap what people pay at $35 per month for all of our insulins, and the average monthly out-of-pocket cost for Lilly insulin is even lower, $20.48. We also cut insulin prices by 70% and automatically cap monthly out-of-pocket costs at $35 or less wherever possible, which should drive that average even lower."
Sanofi-Aventis
"While we will not comment on the specifics of the allegations, Sanofi's pricing practices have always complied with the law and the company is committed to helping patients access the medicine they need at the lowest possible price.
Following through on that commitment requires Sanofi to navigate a complex environment. Under the current system, fees and savings negotiated by health insurance companies and PBMs through rebates are not consistently passed through to patients in the form of lower co-pays or coinsurance. As a result, patients' out-of-pocket costs continue to rise while - between 2012 and 2022 – the average net price of our insulins declined by 58%.
Sanofi believes that no one should struggle to pay for their insulin, regardless of their insurance status or income level, which is why we have a suite of innovative and patient-centric savings programs to help people reduce their prescription medicine costs.
More information can be found at TeamingUpforDiabetes.com"
CVS Health
"Pharmaceutical companies alone are responsible for the prices they set in the marketplace for the products they manufacture. Nothing in our agreements prevents drug manufacturers from lowering the prices of their insulin products and we would welcome such an action. Allegations that we play any role in determining the prices charged by manufacturers for their products are false, and we intend to vigorously defend against this baseless suit."
Novo Nordisk
"Novo Nordisk believes that the allegations in the lawsuit are without merit, and we intend to vigorously defend against these claims. While we will not comment further about ongoing litigation, we recognize that not all patient situations are the same and we have a number of different insulin affordability offerings available through NovoCare. Importantly, we continually review and revise our offerings as well as work with diverse stakeholders to create solutions for differing patient needs.
· A $35.00 insulin option called MyInsulinRxTM is available from Novo Nordisk for eligible patients. The program builds on existing Novo Nordisk insulin affordability options and is intended to further lower out-of-pocket costs for eligible people living with type 1 and type 2 diabetes.
· We have offerings with national pharmacies that provide human insulin for about $25 per vial.
· Effective January 1, 2024, Novo Nordisk lowered the U.S. list prices of several insulin products by up to 75% for people living with type 1 and type 2 diabetes. Products include both pre-filled pens and vials of basal (long-acting), bolus (short-acting) and pre-mix insulins. Novo Nordisk also reduced the list price of unbranded biologics to be the same or a lower list price of each respective branded insulin. Read more here."
Optum Rx
"We have long been focused on lowering the net cost of prescription drugs, including insulin. Our clients and consumers count on us to be a counterweight to the substantial market power of manufacturers, which have sole discretion in setting and raising prices for their products. This lawsuit is without merit and we will defend ourselves against these allegations."
