Defendants in Cleveland’s insulin price-fixing lawsuit are rejecting the city’s claims as "meritless" and "baseless," citing current low prescription costs among other arguments.
Cleveland filed suit in federal court on July 24, alleging that nearly 20 drug manufacturers and pharmacy benefit managers conspired to keep insulin costs artificially high, costing the city millions of dollars as prices increased by 1,000% since 2008.
The lawsuit, which the city says is the first of its kind in the country, was filed in the U.S. District Court for the Northern District of Ohio and will be presided over by Judge Patricia A. Gaughan.
Insulin is made by the pancreas and used by the body to convert food into energy. People who have diabetes don't produce enough insulin and those with Type 1 diabetes must take insulin every day to survive. Nearly 17% of adults in Cleveland have been diagnosed with diabetes, the city's filing said.
Three of the defendants, drug manufacturers Eli Lilly and Company and Sanofi and pharmacy benefit manager CVS Health, dismissed the suit in statements.
"The City of Cleveland’s allegations are meritless," Carrie Munk, Eli Lilly and Company's director of corporate communications wrote.
"The lawsuit ignores that anyone can purchase their monthly prescription of Lilly insulin for $35 or less, whether they are uninsured or use commercial insurance, Medicaid, or a participating Medicare Part D plan, and the average monthly out-of-pocket cost for Lilly insulin is $20.48, a 44% decrease over the last five years. Recently, we announced we are cutting insulin prices by 70% and capping monthly out-of-pocket costs at $35 or less, reinforcing our commitment to closing gaps in the U.S. healthcare system and expanding access to affordable insulin."
A Sanofi spokesperson blamed insurance companies and pharmacy benefit managers (PBM) for rising costs.
"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," the statement read.
"Under the current system, 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%," it said.
Mike DeAngelis, spokesperson for PBM CVS Health, also rejected the city's allegations, claiming in a statement that pharmaceutical companies have no say in drug prices.
"Pharmaceutical companies alone are responsible for the prices they set in the marketplace for the products they manufacture," he said. "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."
However, two of the city's attorneys, Chief Trial Counsel Elena Boop and Chief Assistant Director of Law Amy Hough, said they were not moved by these arguments. Both have personal experience with insulin costs.
Boop, whose daughter is diabetic, said the current monthly caps on insulin costs do not address the years of high costs shouldered by her family and others throughout the region.
"The sentiment that it's now $35, it's just a little too late. Right? I think it's a little too late for my kid who was robbed of the best years of her life," she said.
Hough, who herself is diabetic, rejected CVS Health’s argument PBMs have no authority to set prices. Manufacturers do that, they said.
"Then why did PBMs spend years telling us that they were here to get us better prices?" Hough asked. "Now they're saying, 'Oh, we actually know that's not what we did at all.'"
Hough was also unmoved by Eli Lilly's claim that the lawsuit was "meritless."
"For Lilly to say meritless, I mean, I think (Boop) and I are both defense lawyers," she said. "We've given answers like that too when we didn't have anything better to say."
