HOUSTON — *The above video was originally published Feb. 9, 2019*
Harris County is filing a lawsuit against three insulin manufacturers and four pharmaceutical benefit managers, the Harris County Attorney's Office announced.
The lawsuit accuses the manufacturers and benefit managers of an insulin pricing scheme.
The lawsuit, filed Thursday in the State District Court, names the three largest manufacturers of insulin—Eli Lilly, Novo Nordisk and Sanofi—and the largest pharmaceutical benefit managers (PBMs)—Aetna Rx, CVS Caremark, Express Scripts and OptumRx—as part of a price-fixing scheme that has resulted in record profits for these companies.
The manufacturers and benefit managers were "engaging in a price-fixing conspiracy to raise the price of insulin and other diabetic treatments," the lawsuit alleges.
"This scheme is costing Harris County millions of dollars for health care for both its employees and their dependents and for inmates in the county jail," Harris County Attorney Vince Ryan said in a statement. “This scheme has resulted in record profits for these insulin manufacturers and PBMs. But it has also made insulin unaffordable for many who rely on this life-saving drug. It has created an immense financial burden for employers and governmental entities.”
The lawsuit claims that as a direct result of this alleged conspiracy, Harris County has been overcharged millions of dollars for the insulin and other diabetes medications, according to Ryan's statement.
Ryan said Harris County spends more money on insulin than any other medicine, and, since 2013, has spent more than $ 27.5 million on the drug for county employees, their beneficiaries, and the inmates in the Harris County Jail.
”We believe the manufacturers conspired with pharmaceutical benefit managers to set the price of insulin artificially high," said Ryan. ”If it’s happening to us in Harris County, it’s probably happening everywhere.“
Harris County covers about 38,000 employees and their dependents through insurance. Ryan said about 10 percent rely on insulin as part of their healthcare.
Their goal is to get reimbursed at least the $27.5 million, and they hope the lawsuit could have farther reaching effects to regulate costs worldwide.
”No one with type 1 diabetes asks for it. There’s nothing they can do to prevent it. There’s nothing they can do to change their outcome other than insulin, and even then, insulin is not a cure, it’s a lifeline, and these companies are holding it over our heads," said Carolyn Lawrence, a pre-med student at the University of St. Thomas.
Both Lawrence and her mother have Type 1 diabetes. Lawrence uses at least three vials of insulin per month, which she said could cost nearly $1,000 per month under certain insurances.
Lawrence hopes to become an endocrinologist, to help kids dealing with diabetes with firsthand experience. She was diagnosed at 13 years old.
The prices are so high that some diabetics have to choose whether to pay for food or their insulin.
Ryan said he is expecting other entities to join the lawsuit, but has not yet heard from the Governor or the Attorney General's Office.
Assistant County Attorney Peggy Block said there is a distribution chain. Drug companies make the drugs, then sell them to wholesalers. Wholesalers sell those medicines to pharmacies and other retailers. Those consumers who have insurance will normally want to get drugs that are covered by their insurance.
Harris County's health plan does not decide which drugs are approved to be paid by insurance. Pharmacy Benefit managers make those decisions and control which drugs are approved for insurance payments.
Brands of pharmaceuticals on those lists of approved drugs typically make more money because those medicines are sought after.
This is a developing story. Refresh this page for more information.
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