Mar. 21—A number of pharmacy benefit managers and drug companies are now defendants in a lawsuit brought by the state of Indiana. The suit claims the defendants have colluded to artificially raise the price of insulin by as much as 1,000% in the last decade.
"We believe they have taken advantage of people with serious medical conditions like diabetes," said Indiana Attorney General Todd Rokita in announcing the lawsuit. "The rising prices for insulin put people in the horrible position of choosing between health and financial security. When they raise prices, in lock-step we allege they have made illegal profits from people that truly need this medication."
The state filed the suit in Lake County and named some of the biggest drug and pharmacy benefit companies as its target. Those companies are Sanofi-Aventis, Novo Nordisk, Caremarkpcs Health, Caremark, Express Scripts Administrators, CVS Health Corp and OptumRX.
"By using the complicated drug distribution scheme relied upon by pharmacy benefit managers to hide their scheme, these drug companies have conspired to raise prices on insulin by more than 1000% in the last decade alone," said Rokita. "Hoosiers are already struggling with the economic decline. Scheming to raise prices on diabetes medicine is unethical."
While the suit is filed against the specific companies the attorney general says he is hoping the action will generate changes with both big pharma and all PBMs. Rokita said Eli Lilly is already cooperating with his office.
Not all PBMs were named in the suit. TrueScripts in Washington was excluded.
"Todd Rokita is suing all of these large PBMs, so why is the state doing business with them to begin with? He is suing companies that the state is doing business with as their PBMs. If the state feels like they have conspired and colluded, why are they doing business with them? Why isn't the state working with small and medium PBMs that are much more transparent?," said Kevin Messmer Co-Founder/Chief Legal Officer for TrueScripts. "It will not hurt us, because we are 100% transparent. We do not process claims for drugs like insulin and keep the rebates. We pass 100% of the rebates back to the client so we have no incentive to raise drug prices."
Messmer says there are issues with big pharmacy benefit companies, but they are not problems that all PBMs are involved in. He hopes that the lawsuit might have an opposite impact and encourage businesses to look outside of the major players in the business.