Accomack County files federal lawsuit alleging insulin overpricing


Accomack County and the city of Portsmouth announced that they have filed lawsuits in U.S. District Court, Eastern District of Virginia, against various drug manufacturers and prescription benefit managers for monetary damages arising from the overpricing of insulin.

In the United States, diabetes is growing significantly each year. In 1999, 11 million Americans suffered from diabetes, and that number had increased by 2021 to 38.4 million, said attorney Chap Petersen, who is representing Accomack County.

In Virginia alone, one in 10 residents is diabetic, and these numbers are particularly elevated in the southern half of the state.

In Accomack County, an estimated 13.1% of the adult population has diabetes, while in Portsmouth the percentage is 16.8%, Petersen said.

The price of insulin has soared over the past 20 years. Its list price has climbed by more than 10 times (1,000%) since 2003, exponentially above the rate of inflation.

Much of this dramatic increase is driven by the structure of the retail drug market, specifically the role of the pharmacy benefit managers, who, in theory, negotiate with manufacturers to reduce the cost of drugs, Petersen said.

However, PBMs tend to favor drugs that offer higher manufacturer rebates over similar drugs with lower costs, Peterson alleged.

“As a result, insulin users and the payers of their insurance costs —local governments like Portsmouth and Accomack County — bear the brunt of this market failure,” Petersen said in a prepared release.

In recent years, the U.S. Congress has launched an investigation into the increasing price of insulin, finding that insulin manufacturers acted in concert to raise their prices virtually at the same time, thus keeping prices artificially inflated.

This price inflation has a double impact. For uninsured citizens, the price of a vial of insulin exceeds $100, forcing diabetics to ration their vials; this has a serious impact on their health as a lack of insulin can lead to heart problems, kidney problems, or neuropathy, among others, Petersen said.

On the fiscal side, the health plans offered by local governments to their employees, dependents, and retirees generally include pharmacy benefits, which means these localities pay a substantial portion of the purchase price of prescription diabetes drugs, which are sold at inflated prices.

As a result, municipalities like Accomack or Portsmouth are forced to pay large sums of money for diabetes drugs for which the actual price should be significantly lower.

For this reason, cities and counties across America are taking legal action against insulin overpricing.

Portsmouth and Accomack County have joined these lawsuits to ensure access to medicine and a fair price for their citizens.

The attorneys for Portsmouth and Accomack County are Chap Petersen and Associates, PLC, which is headed by former Virginia State Senator Chap Petersen.

His co-counsel is the Finnell firm of Atlanta, Ga., a consumer litigation boutique.

The two firms previously represented a number of Virginia localities in the opioid cases filed in 2019.

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