From CNBC: 2024-09-20 13:21:00

The Federal Trade Commission is suing three major U.S. health companies that negotiate insulin prices, alleging they inflate costs for patients to boost profits. The lawsuit targets UnitedHealth Group’s Optum Rx, CVS Health’s Caremark, and Cigna’s Express Scripts, collectively overseeing 80% of the nation’s prescriptions.

The FTC’s lawsuit suggests future action against insulin manufacturers Eli Lilly, Sanofi, and Novo Nordisk for driving up list prices on insulin products. PBMs play a central role in the U.S. drug supply chain, negotiating rebates and creating formularies, according to the FTC’s investigation since 2022.

The suit targets PBMs accused of creating a “perverse” drug rebate system that prioritizes high rebates, leading to artificially inflated insulin list prices. The agency aims to put an end to exploitative practices by PBMs to restore competition and drive down drug prices, says FTC’s Rahul Rao.

Approximately eight million Americans with diabetes depend on insulin, many forced to ration due to high prices, according to the FTC. President Biden’s Inflation Reduction Act capped insulin prices at $35 for Medicare beneficiaries, but does not extend to those with private insurance.

The FTC remains concerned about insulin manufacturers inflating prices to meet PBMs’ rebate demands. Eli Lilly, Sanofi, and Novo Nordisk control 90% of the U.S. insulin market, with significant price increases seen over the years, prompting the FTC to caution all drugmakers.

Eli Lilly, Sanofi, and Novo Nordisk have taken steps to address pricing concerns, capping out-of-pocket costs or slashing list prices for insulins. The Biden administration aims to increase transparency into PBM operations as Americans struggle with high prescription drug costs compared to other developed nations.



Read more at CNBC: FTC sues drug middlemen for allegedly inflating insulin prices