Humana sues Mallinckrodt over '97,500%' increase in gel price

Morgan Haefner - Print  | 

Humana filed a lawsuit against Mallinckrodt, alleging the drugmaker partook in "one of the most outrageous price-gouging schemes in the history of American medicine."

The lawsuit, filed Aug. 8 in the Western Division of the U.S. District Court Central District of California, concerns Mallinckrodt's drug Acthar Gel. Acthar, approved by the FDA in 1952 to treat a wide range of ailments as an anti-inflammatory drug, is produced from the pituitary gland of pigs.

In 2001, a vial of Acthar cost $40, according to Humana's lawsuit. That cost grew to more than $39,000 by 2018, reflecting a 97,500 percent price increase, the lawsuit argues.

"It is as if the price of milk increased from $3 to over $2,900 per gallon, or a mortgage payment rose from $2,000 to over $2 million per month," Humana claimed in its lawsuit. Humana accused Mallinckrodt of acting illegally to up the price of Acthar, including creating a monopoly and committing bribery, racketeering, fraud and other illegal practices.

Humana seeks damages in an amount to be determined at trial.

In an emailed statement to Becker's, a company spokesperson for Mallinckrodt said the drugmaker "strongly believes that Humana's complaint is completely without merit as it is based on misstatements of fact and erroneous applications of the law. Humana's past and present utilization management policies require that a patient and prescriber provide Humana with adequate clinical rationale and treatment history before Humana makes an informed and discretionary decision to reimburse Acthar. We therefore, believe that the complaint should be dismissed in its entirety. We will vigorously defend the company in this matter. Acthar remains an important product for the appropriate patients."

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