- Publisher:Phexcom
- Publication:2025/8/7
If at first you don’t succeed, try, try again.
That seems to be the strategy behind a new lawsuit from Texas Attorney General Ken Paxton and Health Choice Alliance accusing Eli Lilly of “incentivizing” providers in the state to prescribe its drugs, including the popular diabetes and obesity medications Mounjaro and Zepbound.
Co-plaintiff Health Choice Alliance has lodged similar complaints against Lilly in the past, but those allegations were subsequently dismissed across multiple courts and by the federal government.
Paxton and Health Choice Alliance are now accusing Lilly of plying Texan medical providers with “illegal incentives” to induce prescriptions of the company’s drugs. Many of those medications were covered by Medicaid, allegedly causing millions of dollars in claims to the state program to be “tainted by Eli Lilly’s illegal marketing and quid pro quo arrangements,” according to a press release from Paxton’s office.
“Big Pharma compromised medical decision-making by engaging in an illegal kickback scheme,” Paxton said in a statement. “I will not stand by while corporations unlawfully manipulate our healthcare system to line their own pockets.”
Eli Lilly, for its part, will “vigorously defend against these allegations,” a company spokesperson said over email.
“Multiple courts and the federal government have rejected claims by this same corporate relator against Lilly as meritless,” the spokesperson continued, alluding to Health Choice Alliance.
The new lawsuit specifically accuses Lilly of orchestrating two kickback schemes referred to in the filing as the “Free Nurse Program” and the “Support Services Program.”
In the first, Lilly allegedly provided—either directly or through third parties—“in-kind remuneration to providers” through the provision of free patient-care services, the lawsuit claims.
Through the second purported scheme, Lilly allegedly provided kickbacks to providers in the form of reimbursement support services.
Aside from Mounjaro and Zepbound, Lilly’s actions were used to encourage prescriptions of drugs like the Type 1 diabetes treatment Basaglar, the eczema med Ebglyss, Emgality for migraine, several insulin presentations, the inflammatory drug Taltz and multiple other approved products, the lawsuit contends.
The lawsuit marks a continuation of Texas’ legal pursuit of Lilly and other large drugmakers.
Last October, the state accused several major pharmacy benefit managers, as well as drugmakers Lilly, Novo Nordisk and Sanofi, of raising the prices of their insulin products and then paying an undisclosed sum back to PBMs in a quid pro quo agreement. In turn, those pharma middlemen allegedly gave preferred status on their standard formularies to drugs with the highest list prices.
“Big pharma insulin manufacturers and PBMs worked together to take advantage of diabetes patients and drive prices as high as they could,” Paxton said at the time.
Meanwhile, Lilly has faced similar kickback claims from Health Choice Alliance before. The research organization originally sued Lilly in 2017, alleging that the Indianapolis drugmaker and other companies ran a “multi-tiered kickback scheme” by offering free nursing services in exchange for prescriptions of Humalog and Humulin as well as the osteoporosis drug Forteo.
In August 2018, a federal judge in Texas dismissed the case on the grounds that the facts stated in Health Choice Alliance’s lawsuit weren’t specific enough to support the allegations. Still, the plaintiff was given an opportunity to restate its claims in an amended suit. And in 2021, the Fifth Circuit Court of Appeals upheld the prior decision to scrap the case.
Regarding Health Choice Alliance’s past claims, “the United States government determined that ‘the relators’ allegations lack sufficient factual and legal support’ in a prior case.” Lilly’s spokesperson said Tuesday.
In its justification, the government explained that “‘federal healthcare programs have a strong interest in ensuring that, after a physician has appropriately prescribed a medication, patients have access to basic product support relating to their medication,” the spokesperson said.