Texas Governor Leading Insulin Manufacturers For Conspiracy to Hike Drug Prices
Jose Nino
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Texas Attorney General Ken Paxton recently filed a lawsuit against leading insulin manufacturers and pharmacy benefit managers concerning an alleged conspiracy to raise insulin prices.
Pharmacy benefit managers are third-party companies that play the role as mediators between drug manufacturers and pharmacies.
Per the attorney general, insulin manufacturers allegedly hiked insulin prices and subsequently paid undisclosed parts back to PBMs to be featured in the PBM standard offerings. PBMs then bestowed preferred status to the manufacturers who make drugs with the highest listing prices, thereby spiking insulin prices significantly.
Paxton proclaimed that insulin manufacturers hiked the prices of their insulin drugs up to 1,000% by implementing a pricing scheme that is in violation of the Texas Deceptive Trade Practices Act.
Such a scheme was carried out to exploit and profit from large rates of diabetes in the Lone Star State.
“This is a disturbing conspiracy by which pharmaceutical companies were intentionally and artificially inflating the price of insulin,” declared Paxton. “Big Pharma insulin manufacturers and PBMs worked together to take advantage of diabetes patients and drive prices as high as they could.”
“These companies acted illegally and unethically to enrich themselves, and we will hold them accountable,” he added.
Some of the defendants in the lawsuit include CVS Pharmacy Eli Lilly, and Express Scripts.
The goal of the state’s lawsuit is to mitigate the damage caused by the insulin pricing scheme by using injunctive relief. The Texas state government is calling on to halt additional illegal actions carried out by insulin manufacturers and PBMs, compensation for damages, disgorgement — this would force companies to give up profits they illegally acquired, impose civil penalties on defendants, in addition to assuming the cost of attorney’s fees.
Drug companies are incredibly corrupt. At some point, market reforms are not a viable strategy to implement in order to rein these companies. It’s going to take prudential state action from red state governors to bring these entities to heel.
Texas is setting an example for countless other states to follow.
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