A settlement between Eli Lilly LLY.N and purchasers of its insulin drugs that would have capped prices and provided $13.5 million to resolve claims that the company inflated the drugs' cost has fallen apart, after an unfavorable ruling from the judge overseeing the case.
Lawyers for a proposed nationwide class of individuals who paid for Lilly's Humalog and other insulin drugs said in a filing in Newark, New Jersey, federal court on Friday that they and Lilly had decided not to go forward seeking approval for the deal, which they first proposed last May.
Steve Berman, one of the lawyers, said in an email that the decision to drop the deal came after U.S. District Judge Brian Martinotti in February refused to certify a class in the litigation, which also targets insulin drug makers Novo Nordisk and Sanofi. The plaintiffs have since filed an amended version of their complaint again seeking to proceed as a class action.
Nonetheless, Berman said that because of the February decision, in which Martinotti found that classwide issues did not predominate over individual ones, "we see no way for us to get a settlement class approved."
Berman called the demise of the settlement, which would have capped patients' out-of-pocket insulin costs at $35 per month for four years, a "potentially big loss for consumers."
Lilly said in a statement that the plaintiffs' claims lacked merit and that it would continue to defend itself.
Lilly and the other companies are still facing lawsuits by states, some of which objected to the settlement with purchasers on the grounds that it could interfere with their lawsuits.
The company in February settled with Minnesota, agreeing to a price cap and to donate insulin to clinics in the state.
Plaintiffs in the cases allege that insulin drug makers set artificially high list prices for their products, while paying rebates to pharmacy benefit managers (PBMs) in exchange for their covering the drug on behalf of health plans.
Insulin is vital for patients with type 1 diabetes to control their blood sugar and for some patients with the more common type 2 diabetes.
Lilly said last March it would slash insulin prices and make it available to many patients for $25 or $35, following pressure from Democratic President Joe Biden, lawmakers and advocacy groups over skyrocketing costs.
A survey released last July by U.S. Senator Elizabeth Warren, a Democrat from Massachusetts, found that many patients nevertheless were still being charged hundreds of dollars for treatments.
Around 8.4 million of the 37 million people in the United States with diabetes use insulin, according to the American Diabetes Association.
The case is In re Insulin Pricing Litigation, U.S. District Court, District of New Jersey, No. 2:17-cv-00699.
For plaintiffs: Steve Berman of Hagens Berman Sobol Shapiro
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