Judge rules insulin makers and PBMs must face racketeering claims

A federal judge dropped allegations that three drug makers engaged in antitrust practices by scheming to overcharge for insulin, but the companies will continue to face racketeering claims in a lawsuit brought by pharmaceutical wholesalers.

In the lawsuit, the insulin makers — Eli Lilly (LLY), Sanofi  (SNY), and Novo Nordisk (NVO) — were accused of inflating prices by paying kickbacks in the form of rebates and various administrative fees to pharmacy benefit managers in exchange for favorable placement on formularies. These are lists of medicines for which coverage is provided by health insurers that hire PBMs to negotiate on their behalf.

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