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The state of California in the US is suing the nation’s largest insulin manufacturers and pharmacy benefit managers (PBMs) for allegedly using their market power to overcharge patients for the life-saving drug, the state's attorney general Rob Bonta announced. Eli Lilly, Novo Nordisk and Sanofi produce over 90% of the global insulin supply and the PBMs CVS Caremark, Express Scripts and OptumRx administer pharmacy benefits for around 80% of prescription claims managed. The lawsuit, filed in the California Superior Court in Los Angeles, argues that because competition is highly limited in both their markets, these six companies are able to keep ‘aggressively hiking’ the list price of insulin at the expense of patients, violating the state's Unfair Competition Law. According to a 2021 Congressional report, Eli Lilly, Novo Nordisk and Sanofi have raised the price of their insulin by 1,219%, 627% and 715%, respectively, since they were first launched. “Insulin is a necessary drug that millions of Americans rely upon for their health, not a luxury good,” said Bonta. "With today's lawsuit, we're fighting back against drug companies and PBMs that unacceptably and artificially inflate the cost of life-saving medication at the expense of vulnerable patients.” The California Health and Human Services Agency reported this year that, according to national data, as many as one in four diabetics cannot afford their insulin, forcing them to ration or stop taking insulin altogether. A statement issued by the attorney general’s office adds that those from low-income households and some racial and ethnic groups are disproportionately impacted by the practices. This includes Hispanic and black people, who are much more likely to be diagnosed with type 2 diabetes than non-Hispanic white people, and more likely to die as a result of complications from it. Through the lawsuit, California is seeking to control the cost of insulin by promoting price competition and eliminating ‘unlawful, unfair and deceptive practices’, as well as to recover restitution for past overpayments for the drug. Other states including Minnesota, Mississippi, Arkansas and Kansas, as well as groups of drug purchasers, have previously brought legal action over insulin pricing. “No one should be forced to ration or go without basic medication that could mean the difference between life or death. California will continue to be a leader in the fight to ensure everyone has equal access to affordable healthcare and prescription medications they need to stay healthy,” Bonta added.

Three drugmakers produce 90% of the global insulin supply, and three pharmacy benefit managers manage 80% of prescription claims in the U.S., according to the lawsuit. California has filed suit against a slew of major drugmakers and pharmacy benefit managers, alleging that they acted unlawfully to drive up the cost of insulin. The lawsuit claims that Eli Lilly, Novo Nordisk and Sanofi, major manufacturers of insulin, and CVS Caremark, Express Scripts and Optum, the three largest pharmacy benefit managers, used their market share to overcharge patients. A recent analysis shows that insulin costs roughly 10 times more for American patients as it does elsewhere, according to an announcement from Attorney General Rob Bonta's office. The three drugmakers produce 90% of the global insulin supply, and the three PBMs manage 80% of prescription claims in the U.S., according to the lawsuit. The lawsuit argues both set of companies are complicit in the high cost of insulin as manufacturers are responsible for setting list prices and then PBMs negotiate rebated costs on behalf of health insurers. Because rebates are based on list price, drugmakers will increase list prices to secure higher rebates. People of color and those with low incomes are disproportionately affected by high insulin prices, according to the announcement. More than 3 million people in California alone—more than 10% of the adult population—have diabetes. “Insulin is a necessary drug that millions of Americans rely upon for their health, not a luxury good. With today's lawsuit, we're fighting back against drug companies and PBMs that unacceptably and artificially inflate the cost of life-saving medication at the expense of vulnerable patients,” said Bonta in the release. “No one should be forced to ration or go without basic medication that could mean the difference between life or death. California will continue to be a leader in the fight to ensure everyone has equal access to affordable healthcare and prescription medications they need to stay healthy," he added. The lawsuit seeks to establish price competition for insulin, eliminating what it calls "unlawful, unfair, and deceptive practices," as well as to recover restitution for people in California who where overcharged for insulin.