Federal, state probes target insulin drug makers, pharma middlemen
The U.S. is one of the few developed countries without regulations on prescription drug pricing
Have insulin drug makers and middlemen in the supply chain allowed prices to escalate in order to increase their profits?
By SARAH JANE TRIBBLE, Contributing Writer
LOS ANGELES — With the price of a crucial diabetes drug skyrocketing, at least five states and a federal prosecutor are demanding information from insulin drug makers and the pharmaceutical industry’s financial middlemen, seeking answers about their business relationships and the soaring price of diabetes drugs.
Attorneys general in Washington, Minnesota and New Mexico issued civil investigative demands this year and are sharing information with Florida and California, according to various corporate financial filings.
Insulin drug makers Eli Lilly, Novo Nordisk, Sanofi, and top pharmacy benefit manager CVS Health are targets in the state investigations. Several of the financial filings note that the state and federal prosecutors want information regarding specific insulins for specific dates in relation to “trade practices.”
They appear to be looking into potentially anti-competitive business dealings that critics have leveled at this more than $20 billion niche market of the pharmaceutical industry, according to analysts and court filings reviewed by Kaiser Health News. These include whether insulin drug makers and middlemen in the supply chain have allowed prices to escalate in order to increase their profits.
At the same time, prominent class-action lawyers are bringing suits on behalf of patients. Steve Berman, an attorney best known for winning a multi-billion-dollar settlement from the tobacco industry, alleged collusion and said it was time to break up the “insulin racket.”
The price of insulin — a lifesaving drug — has reached record highs as Eli Lilly, Novo Nordisk and Sanofi raised prices more than 240 percent over the past decade to often over $300 a vial today, with price rises frequently in lockstep, according to information technology firm Connecture.