Humana has filed suit against Regeneron, alleging that the drugmaker inflated the price of its Eylea drug.
According to a complaint, Regeneron inflated the price of the drug, which treats age-related macular degeneration, and then paid kickbacks disguised as donations to the Chronic Disease Foundation (CDF) to cover cost-sharing for patients who may be able to take a cheaper alternative.
Humana said in the suit that the scheme has been critical to the drug's success.
"This scheme has contributed to Eylea’s massive success; it generates billions of dollars in revenue annually for Regeneron and is the top-selling drug of its kind in the United States," the insurer wrote in the complaint.
Eylea costs approximately $10,000 per year, according to the suit. For comparison, a competitor, Avastin, is equally effective but costs 3% of Eylea, Humana said in the complaint.
Regeneron was able to ensure that its donations to CDF were used only to cover cost-sharing for Eylea in an effort to block competitors, Humana claims in the suit. With the patient cost-sharing covered, Medicare and other payers were left holding the bag for the majority of the drug's inflated price, according to the lawsuit.
"Thus, patients could obtain Eylea at no cost to them instead of choosing drugs offered by Regeneron’s competitors which were otherwise significantly cheaper," the insurer said. "This operation eliminated any sensitivity by patients or their physicians to the true price of Eylea, and at the same time, allowed Regeneron to price Eylea well-above what the market would otherwise support."
Humana's lawsuit piggybacks on a Department of Justice investigation, which uncovered the scheme, according to the filing. DOJ filed suit against Regeneron over similar complaints in June 2020.
A Regeneron spokesperson said in a statement to Fierce Healthcare that both the Humana lawsuit and DOJ suit are "without merit."
"These complaints relate to lawful, charitable donations Regeneron made in 2013 and early 2014 to an independent charitable patient assistance foundation to assist financially disadvantaged elderly patients with wet age-related macular degeneration ("wet AMD") gain access to treatments designed to prevent blindness," the spokesperson said. "Regeneron is proud to support patients in need through donations to charitable foundations, which help to ensure elderly patients have access to the medicines prescribed by their physicians."
Humana said in the complaint that it is filing suit to recover damages lost in overpaying for the drug and to "stop Regeneron's unlawful conduct."