Penn sues Eli Lilly, CVS Caremark, and others over an insulin price scheme

The University of Pennsylvania is suing three leading insulin makers and companies that negotiate drug price deals for insurance plans, accusing them of a scheme to drive up prices of a medication that people with diabetes rely on to control blood sugar levels.

Penn’s health plan, which covers nearly 69,000 employees at the University of Pennsylvania and University of Pennsylvania Health System, has spent millions in overpayments for insulin as prices rose rapidly, according to a lawsuit filed earlier this month in the U.S. District Court in the District of New Jersey.

In court documents, Penn says that the top three insulin manufacturers — Eli Lilly, Novo Nordisk, and Sanofi — colluded with the three largest pharmacy benefit managers — CVS Caremark, Express Scripts, and OptumRX — to drive up insulin prices by as much as 1,000% over the past 20 years.

The drug companies and pharmacy benefit managers, known as PBMs, all denied wrongdoing in statements to The Inquirer. The three pharmaceutical giants said in separate statements that the lawsuit’s claims are baseless and pointed to recent efforts to reduce drug costs for patients.

The PBMs said that drug companies alone are responsible for insulin prices. PBMs negotiate prescription drug deals between insurance plans and pharmaceutical companies.

Penn did not respond to a request for comment.

Penn joins more than 400 other institutions, school districts, and municipalities — including Bucks County and Philadelphia — that are suing the same group over insulin prices. The cases have been consolidated in New Jersey.

Last year, the Federal Trade Commission sued the same three PBMs, which manage about 80% of prescriptions, claiming that insulin prices were artificially inflated by their rebate programs.

Insulin prices have declined in the last few years following new federal regulations, but the medication remains a focal point of national drug-price controversy because it is widely used and is expensive, despite being on the market for decades.

People with type 1 diabetes, whose bodies do not produce insulin at all, cannot live without the medication. People with type 2 diabetes use the medication to help regulate their blood sugar levels.

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Retail prices for insulin dropped 42% between 2019 and 2024 after Medicare capped its prices and manufacturers voluntarily lowered prices for patients with other types of insurance, according to a study by GoodRx, which monitors drug prices.

Prices are now at a decade low, but common medications still cost hundreds of dollars a month.

The insulin lawsuits aim to recoup overpayments and establish greater restrictions on prices in the future.