Eli Lilly to stand trial over Medicaid reimbursements

A whistleblower complaint against Eli Lilly is now heading to a jury trial.

On February 28, Judge Harry D. Leinenweber ruled that the lawsuit against Eli Lilly for allegedly compromising the Centers for Medicare and Medicaid Services (CMS) on rebates will go to trial, despite Lilly’s request to dismiss the case.

Monday’s ruling, filed in the U.S. District Court for Eastern Illinois, is the latest development in years of legal back-and-forth regarding Indianapolis-based Lilly’s reimbursement amounts between 2005 and 2016.

Whistleblower Ronald J. Streck filed the original lawsuit against Lilly, claiming the drugmaker violated the False Claims Act by submitting false claims and certifications to the United States as well as several states as part of its claims program. Medicaid reimbursement, ending up underpaying.

Lilly participates in the Medicaid Reimbursement Program (MDRP), where participating drugmakers must provide government and state reimbursement in order for their drugs to be used by Medicaid patients. The amount of the rebate is determined by the average manufacturer’s price (AMP), which Congress defined in 1991 as “the average unit price paid to the manufacturer for the drug in the [United] States by wholesalers for drugs distributed to the retail pharmacy trade class,” according to the filing.

In addition, the MPA “must be adjusted by the manufacturer if cumulative rebates or other arrangements subsequently adjust actual realized prices,” the decision explained. For example, when prices increase, the discount amount should also increase.

However, the 1991 agreement provided leeway for a drugmaker to calculate MPA themselves in the absence of specific guidelines. Lilly says it did so until CMS issued clarifying rules in 2016, according to the filing.

Monday’s decision found otherwise, directly calling Lilly’s interpretation of the pre-2016 GPA “objectively unreasonable.”

Following Monday’s ruling, a jury trial will ultimately determine whether Lilly acted intentionally in not calculating MPA as high as it should have between 2005 and 2016, as well as whether it caused a loss to Medicaid agencies in all 26 states and the federal government. government.

Lilly did not respond to request for comment at the time of publication.

Photo: Eli Lilly

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