Why has Cleveland filed a lawsuit related to insulin prices?

On Behalf of | Aug 3, 2023 | Insulin Litigation

Lawsuits against drug makers and other businesses often come from individuals directly harmed by those organizations or their surviving family members. However, sometimes government authorities pursue legal action against businesses that have allegedly violated the law or the rights of individuals. 

That is exactly what the city of Cleveland did on Monday, July 24th, 2023. Lawyers from Kelley Ferraro, LLC, assisted the city in initiating a lawsuit in the Northern Ohio District Court. The lawsuit alleges that a number of major Pharmacy Benefit Managers (PBMs) unfairly inflated the price of insulin and negatively impacted Cleveland residents by doing so. 

The specific businesses listed in the lawsuit include CVS Caremark, Express Scripts and OptumRx. If successful, the lawsuit could have a major impact on Cleveland residents and others across the country. Why did the city of Cleveland decide to take action? 

The city alleges that PBMs have inflated insulin prices

PBMs have a lot of control over what care consumers actually receive. Their role is that of a middleman, meaning that they help manage relationships between companies that provide insurance or prescriptions to consumers and drug manufacturers. These organizations influence what medications people can access and what price they pay. 

The lawsuit alleges that the PBMs created a pricing scheme that drastically influenced the cost of insulin. The production costs of insulin can be as low as $2, but retail prices for vials of insulin are often between $300 and $700. Current policies and practices give drug manufacturers an incentive to artificially inflate the suggested retail price for insulin. The organizations listed as defendants in the lawsuit control over 80% of the local market for prescription medication. 

Officials in Cleveland are very concerned because almost 17% of local residents have diabetes and may require insulin. Diabetics who require insulin need a consistent supply of it and will die without the drug. This means that they often go to great lengths to pay for medication that may have an unfairly high price tag attached. 

Should the lawsuit succeed, it could potentially prompt substantial reform that will benefit those affected by high insulin prices. Changes in company practices could make life-saving medication more accessible to those who depend on insulin to manage their health.


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