ELECTRONICALLY FILED
`Pulaski County Circuit Court
`Terri Hollingsworth, Circuit/County Clerk
`2022-May-11 10:50:10
`60CV-22-2976
`C06D17 : 131 Pages
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`IN THE CIRCUIT COURT OF PULASKI COUNTY, ARKANSAS
`CIVIL DIVISION
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`THE STATE OF ARKANSAS, EX.REL.,
`LESLIE RUTLEDGE, ATTORNEY
`GENERAL
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`PLAINTIFF,
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`ELI LILLY AND COMPANY; NOVO
`NORDISK INC.; SANOFI-AVENTIS
`U.S. LLC; EVERNORTH HEALTH,
`INC. (FORMERLY EXPRESS SCRIPTS
`HOLDING COMPANY); EXPRESS
`SCRIPTS, INC.; EXPRESS SCRIPTS
`ADMINISTRATORS, LLC; ESI MAIL
`PHARMACY SERVICES, INC.;
`EXPRESS SCRIPTS PHARMACY, INC.;
`MEDCO HEALTH SOLUTIONS, INC;
`CVS HEALTH CORPORATION; CVS
`PHARMACY, INC; CAREMARK RX,
`LLC; CAREMARK PCS HEALTH, LLC;
`CAREMARK, LLC; UNITEDHEALTH
`GROUP, INC.; OPTUM, INC.;
`OPTUMRX INC.; OPTUMRX
`HOLDINGS, LLC; AND
`OPTUMINSIGHT, INC.
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`V.
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` DEFENDANTS.
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` Case No.
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`Jury Trial Demanded
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`COMPLAINT
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`TABLE OF CONTENTS
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`INTRODUCTION ............................................................................... 1 
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`PARTIES ......................................................................................... 10 
`A. 
`Plaintiff ....................................................................................................... 10 
`B.  Manufacturer Defendants ......................................................................... 11 
`C. 
`PBM Defendants ........................................................................................ 16 
`  THE STATE OF ARKANSAS’S INTEREST ....................................... 43 
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`JURISDICTION AND VENUE .......................................................... 44 
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`FACTUAL ALLEGATIONS ............................................................... 46 
`A. 
`Diabetes and Insulin Therapy. ................................................................. 46 
`1. 
`Diabetes: A growing epidemic. ...................................................... 46 
`2. 
`Insulin: A century old drug. .......................................................... 48 
`3. 
`Current insulin landscape. ............................................................ 50 
`4. 
`Insulin adjuncts: Type 2 medications. .......................................... 51 
`The Dramatic Rise in the Price of Diabetes Medications. ..................... 54 
`1. 
`Insulin price increases. .................................................................. 54 
`2. 
`Manufacturers increased prices in lockstep. ............................... 60 
`Pharmaceutical Payment and Supply Chain. ......................................... 65 
`1. 
`Drug Costs for Diabetics. ............................................................... 66 
`2. 
`PBMs’ role in the pharmaceutical payment chain. ..................... 68 
`3. 
`The rise of the PBMs in the pharmaceutical supply chain. ....... 70 
`4. 
`Insular nature of the pharmaceutical industry. .......................... 73 
`The Insulin Pricing Scheme. .................................................................... 76 
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`B. 
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`C. 
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`D. 
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`E. 
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`F. 
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`G. 
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`I. 
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`H. 
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`Defendants Admit That They Have Engaged in the Insulin
`Pricing Scheme. ......................................................................................... 81 
`Defendants’ Profit Off the Insulin Pricing Scheme. ............................... 86 
`1. 
`Manufacturers’ Profit Off Insulin Pricing Scheme. .................... 86 
`2. 
`PBMs’ Profit Off Insulin Pricing Scheme. .................................... 86 
`3. 
`PBMs pocket most of the secret Manufacturer Payments. ........ 87 
`4. 
`PBMs’ profit off pharmacies. ......................................................... 92 
`5. 
`Insulin Pricing Scheme increases PBM mail order profits. ....... 93 
`The State, and its Residents who Suffer from Diabetes,
`Purchase the At-Issue Drugs from Defendants. ..................................... 94 
`Defendants Deceived the State. ............................................................... 95 
`Manufacturer Defendants deceived Arkansas Diabetics
`1. 
`and the State. .................................................................................. 95 
`PBM Defendants deceived Arkansas diabetics and the
`State. ................................................................................................ 98 
`The Insulin Pricing Scheme Has Damaged the State and
`Arkansans who Suffer from Diabetes. ................................................... 107 
`Defendants’ misconduct damaged the State as a payor for
`1. 
`and purchaser of the at-issue drugs. .......................................... 107 
`The Insulin Pricing Scheme has damaged the State by
`increasing its healthcare costs and decreasing
`productivity. .................................................................................. 108 
`The Insulin Pricing Scheme has damaged Arkansas
`Diabetics. ....................................................................................... 109 
`Defendants’ Recent Efforts in Response to Rising Insulin Prices. ...... 110 
`J. 
`  TOLLING OF STATUTE OF LIMITATIONS .................................... 112 
`A. 
`Discovery Rule Tolling. ............................................................................ 113 
`B. 
`Fraudulent Concealment Tolling. ........................................................... 114 
`C. 
`Estoppel. .................................................................................................... 114 
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`2. 
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`2. 
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`3. 
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`ii
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`Continuing Violations. ............................................................................. 114 
`D. 
`  CLAIMS FOR RELIEF .................................................................... 115 
`Arkansas Deceptive Trade Practices Act, Ark. Code Ann. §§ 4-
`88-101 through 115, et seq. (Against All Defendants) ........................... 115 
`Unjust Enrichment (Against All Defendants) ....................................... 119 
`Civil Conspiracy (Against All Defendants) ............................................ 121 
`  JURY DEMAND ............................................................................. 123 
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`  PRAYER FOR RELIEF .................................................................. 123 
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`TABLE OF FIGURES
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`Figure 1: Price Increase of Insulin vs. Selected Consumer Goods from 1997-
`2018 ................................................................................................................... 5 
`Figure 2: Rising list prices of Humulin R (500U/mL) from 1997-2021 ...................... 55 
`Figure 3: Rising list prices of Humalog vials and pens from 1996-2021 ................... 56 
`Figure 4: Rising list prices of Levemir from 2006-2021 ............................................... 57 
`Figure 5: Rising list prices of Novolog vials and pens from 2002-2021 ..................... 58 
`Figure 6: Rising list prices of Lantus vials and pens from 2001-2021 ...................... 59 
`Figure 7: Rising list prices of long-acting insulins ....................................................... 61 
`Figure 8: Rising list prices of rapid-acting insulins ..................................................... 62 
`Figure 9: Rising list price increases for human insulins ............................................. 63 
`Figure 10: Rising list prices of Type 2 drugs ................................................................. 64 
`Figure 11: Lockstep insulin price increases .................................................................. 65 
`Figure 12: Insulin distribution and payment chain ..................................................... 68 
`Figure 13: PBM consolidation ........................................................................................ 72 
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`iv
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`Plaintiff, the State of Arkansas, ex rel. Leslie Rutledge, Attorney General, (the
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`“State” or “Plaintiff”), brings this action against Eli Lilly and Company; Novo Nordisk
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`Inc.; Sanofi-Aventis U.S. LLC; Evernorth Health, Inc. (formerly Express Scripts
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`Holding Company); Express Scripts, Inc.; Express Scripts Administrators, LLC; ESI
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`Mail Pharmacy Services, Inc.; Express Scripts Pharmacy, Inc.; Medco Health
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`Solutions, Inc; CVS Health Corporation; CVS Pharmacy, Inc; Caremark Rx, LLC;
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`Caremark PCS Health, LLC; Caremark, LLC; UnitedHealth Group, Inc.; Optum, Inc.;
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`OptumRx Inc.; OptumRx Holdings, LLC; and OptumInsight, Inc. (collectively,
`“Defendants”) for violations of the laws of the State of Arkansas and alleges as follows:
`INTRODUCTION
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`Diabetes is an epidemic and a public health crisis in Arkansas. Arkansas
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`1.
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`has a high prevalence of diabetes with approximately 14% of its adult population—
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`over 400 thousand people—living with diabetes. An additional 800 thousand Arkansas
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`residents have pre-diabetes, which is when a person’s blood sugar level is higher than
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`it should be and signifies that the person is at greater risk for developing diabetes.
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`2.
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`Diabetes is the leading cause of blindness, kidney failure, and lower limb
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`amputations and is the seventh leading cause of death in Arkansas, despite the
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`availability of effective treatment.
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`3.
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`The economic impact of diabetes is staggering. The total estimated cost
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`of diagnosed diabetes in Arkansas is $3.1 billion per year.
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`4.
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`Hundreds of thousands of diabetics in Arkansas rely on daily insulin
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`treatments to survive, and millions more use either oral medications, insulin, or a
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`combination of both to control their diabetes.
`1
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`5.
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`Defendants Eli Lilly, Novo Nordisk, and Sanofi
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`(collectively,
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`“Manufacturer Defendants” or “Manufacturers”) manufacture the vast majority of
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`insulins and other diabetic medications available in Arkansas.
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`6.
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`Defendants CVS Caremark, Express Scripts, and OptumRx collectively
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`dominate the pricing system for the at-issue drugs (collectively, “PBM Defendants” or
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`“PBMs”).1 The PBM Defendants’ dominance results from the reality that these three
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`corporate actors are, at once (1) the largest pharmacy benefit managers in the United
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`States and in Arkansas (controlling approximately 80% of the PBM market), (2) the
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`largest pharmacies in the United States and in Arkansas (making up 3 of the top 5
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`dispensing pharmacies in the U.S.), and (3) housed within the same corporate families
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`as three of the largest insurance companies in the United States and in Arkansas—
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`Aetna (CVS Caremark), Cigna (Express Scripts), and UnitedHealthcare (OptumRx).
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`These Defendant corporate conglomerates sit at 4th (CVS Caremark), 5th (OptumRx),
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`and 13th (Express Scripts) on the Fortune 500 list ranking largest corporations by
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`revenue.
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`7.
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`As part of their work, PBM Defendants establish standard formulary
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`offerings (i.e., approved drug lists). If a drug is not included on a formulary, then it is
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`not covered by health insurance.
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`8.
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`PBM Defendants understand that their standard formulary offerings
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`drive drug utilization.
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`1 In the context of this Complaint, the “at-issue drugs” are Humulin N, Humulin R, Humalog,
`Trulicity, Basaglar, Lantus, Toujeo, Apidra, Soliqua, Novolin R, Novolin N, Novolog,
`Levemir, Tresiba, Victoza, and Ozempic.
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`2
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`9.
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`Because the three PBM Defendants control 80% of the pharmacy benefit
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`market, unless they include a drug on one of their standard formulary offerings, it is
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`not available to 80% of Arkansas’s citizens.
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`10.
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`The Manufacturers
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`likewise understand that PBMs’ standard
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`formularies drive drug utilization—if Manufacturers want their drugs to be prescribed
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`and paid for, they must obtain preferrable formulary position on the PBM Defendants’
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`formularies.
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`11. Given the PBMs’ market power and the crucial role their standard
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`formularies play in the pharmaceutical pricing chain, both Defendant groups
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`understand that the PBM Defendants wield enormous control over drug prices and
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`drug purchasing behavior in Arkansas.
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`12.
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`The unconscionable and deceptive scheme at the root of this
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`Complaint—the
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`Insulin Pricing Scheme2—was born
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`from
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`this mutual
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`understanding.
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`13. Over the course of the last fifteen years, and pursuant to the Insulin
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`Pricing Scheme, Manufacturer Defendants have in lockstep raised the prices of their
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`respective diabetes drugs in an astounding manner, even though the cost to produce
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`these drugs has decreased during that same time period.
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`14.
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`Insulins, which today cost Manufacturer Defendants less than $2 per
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`drug to produce, and which were originally released at a list price of $20 per drug in
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`the late 1990s, now carry list prices that range between $300 and $700 per drug.
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`2 The Insulin Pricing Scheme is further defined in paragraph 20 below.
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`3
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`15.
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`In the last decade alone, Manufacturer Defendants have in tandem
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`increased the prices of their insulins up to 1,000%, often down to the decimal point,
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`within a few days of each other.
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`16.
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`Figure 1 illustrates the rate at which Defendant Eli Lilly raised the price
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`of its analog insulin Humalog, compared to the rate of inflation for other consumer
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`goods and services from 1997-2018.
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`Figure 1: Price Increase of Insulin vs. Selected Consumer
`Goods
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`17. Remarkably, nothing about these medications has changed; today’s $350
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`insulin is the exact drug Defendants originally sold for $20.
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`18.
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`The current outrageously inflated price stands in stark contrast to
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`insulin’s origins: the discoverers sold the original patent for $1 to ensure that the
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`medication would remain affordable. Today, insulin has become the poster child for
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`skyrocketing and inflated drug prices. Consumers and payors bear the brunt of this
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`increase.
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`19. Both Manufacturer and PBM Defendants play vital roles and profit
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`immensely from the Insulin Pricing Scheme and the artificially inflated prices
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`produced by it.
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`20.
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`Specifically, the Insulin Pricing Scheme works as follows: first, to gain
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`formulary access from the PBM Defendants for their diabetic treatments,
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`Manufacturer Defendants artificially and willingly raise their list prices, and then pay
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`an undisclosed portion of that price back to the PBMs. These Manufacturer Payments3
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`are provided under a variety of labels, yet, however they are described, these
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`3 In the context of this Complaint, the term “Manufacturer Payments” is defined as all
`payments or financial benefits of any kind conferred by the Manufacturer Defendants to PBM
`Defendants (or a subsidiary, affiliated entity, or group purchasing organization or rebate
`aggregator acting on the PBM’s behalf), either directly via contract or indirectly via
`Manufacturer-controlled
`intermediaries. Manufacturer Payments
`includes rebates,
`administrative fees, inflation fees, pharmacy supplemental discounts, volume discounts,
`price, or margin guarantees and any other form of consideration exchanged. This broad
`definition is necessary because PBMs historically have continued to change and evolve the
`nature of their payment streams to avoid disclosure to clients and disclosure pursuant to
`state transparency laws. While the route by which the payment streams reach the PBMs has
`evolved, the fact that the payments do, in fact, reach the PBMs has remained the same.
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`Manufacturer Payments, along with the inflated list prices, are quid pro quo for
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`formulary inclusion on the PBMs’ standard offerings.
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`21.
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`The list prices for the at-issue drugs have become so untethered from the
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`net prices realized by the Manufacturers as to constitute a false price.
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`22.
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`PBMs then grant preferred status on their standard formularies based
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`upon the largest Manufacturer Payment and the highest inflated list price—which the
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`PBMs know to be artificially inflated and which the PBMs insist that their payor
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`clients use as the basis for the price they pay for the at-issue drugs.
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`23.
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`The Insulin Pricing Scheme creates a “best of both worlds” scenario for
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`Defendants. Manufacturer Defendants are able to make these undisclosed
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`Manufacturer Payments to buy preferred formulary position—which significantly
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`increases their revenue—without sacrificing their profits.
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`24.
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`PBM Defendants profit off the inflated list prices that result from the
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`scheme in numerous ways, including: (1) retaining a significant—yet undisclosed—
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`percentage of the Manufacturer Payments, either directly or through wholly-owned
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`rebate aggregators, (2) using the inflated list price produced by the Insulin Pricing
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`Scheme to generate profits from pharmacies in their networks, and (3) relying on those
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`same inflated list prices to drive up the PBMs’ profits through their own pharmacies.
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`25.
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`Thus, while the PBM Defendants represent both publicly and to their
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`clients that they use their market power to drive down prices for diabetes medications,
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`these representations are patently false and intended to be deceptive and misleading.
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`26. Rather, the PBMs are intentionally driving up the price of the at-issue
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`drugs. Indeed, the Manufacturer Payments that the PBMs receive in exchange for
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`preferred formulary position, along with the PBMs’ actual formulary construction, are
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`directly responsible for the skyrocketing price of the at-issue diabetes medications.
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`27. Because the price paid by nearly every diabetic and payor is based upon
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`the artificially inflated list prices generated by Defendants’ scheme, the Insulin
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`Pricing Scheme directly harms every diabetic and payor in Arkansas who purchases
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`these life-sustaining drugs.
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`28.
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`The consequence to Arkansas public health and the public treasury from
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`the outrageous price increases caused by the Insulin Pricing Scheme cannot be
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`overstated. The State of Arkansas, as a payor for the at-issue drugs through its
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`employee health plans, and as a purchaser of the at-issue drugs at state-run facilities,
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`has been overcharged millions of dollars a year.
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`29. Arkansas residents suffering from diabetes have also been overcharged
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`millions of dollars a year in out-of-pocket costs as a result of the Insulin Pricing
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`Scheme.
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`30.
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`For these Arkansas residents with diabetes, the physical, emotional, and
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`financial tolls of paying such excessive prices for diabetes medications is devastating.
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`Unable to afford the drugs their doctors prescribe, many diabetics in Arkansas ration
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`or under-dose their insulin, inject expired insulin, reuse needles, and starve
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`themselves to control their blood sugars. This behavior is extremely dangerous and
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`has led to serious complications or even death.
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`31.
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`In addition to the immeasurable human costs, the Insulin Pricing
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`Scheme also adds substantial costs to the Arkansas health care system by increasing
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`preventable complications. For example, one national model found that all people with
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`diabetes adhering to their diabetes medications would save $8.3 billion in direct
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`medical costs per year by averting one million emergency department visits and
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`618,000 hospitalizations.
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`32. Arkansas shoulders the burden for much of these increased healthcare
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`costs, spending billions of dollars annually in healthcare-related costs for diabetes and
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`diabetes-associated complications. The amount that Arkansas has spent on diabetes-
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`related costs has steadily increased throughout the relevant time period and could
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`grow exponentially given the high prevalence of pre-diabetes in Arkansas.
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`33.
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`Thus, in addition to being overcharged for the at-issue drugs through its
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`employee benefit programs and purchases for state facilities, the significant increase
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`in health care expenditures caused by the Insulin Pricing Scheme has also damaged
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`the State.
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`34.
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`Insulin rationing and the resulting otherwise-avoidable health
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`complications caused by the Insulin Pricing Scheme leads to a loss in productivity and
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`tax revenue, further damaging the State.
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`35.
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`The State, through Leslie Rutledge, Attorney General, brings this action
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`on behalf of the State of Arkansas and its residents: (a) to protect the health and
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`economic well-being of the State as a whole and the heath and economic well-being of
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`Arkansas residents in its parens patriae capacity; (b) on behalf of the State as a payor
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`9
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`for and purchaser of the at-issue diabetes medications through its health plans and
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`state-run facilities; (c) on behalf of the State to recover damages for additional costs it
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`has and will incur as a result of the Insulin Pricing Scheme; and (d) for injunctive
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`relief that will halt the Insulin Pricing Scheme.
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`36.
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`This action asserts causes for Defendants’ violations of the Arkansas
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`Deceptive Trade Practices Act, unjust enrichment, and civil conspiracy.
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`37.
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`This action seeks injunctive relief, restitution, disgorgement, actual
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`damages, treble damages, punitive damages, civil penalties, and attorneys’ fees to
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`address and abate the harm caused by the Insulin Pricing Scheme.
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`38.
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`The relevant period for damages alleged in this Complaint is from 2003
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`continuing through the present.
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`PARTIES
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`Plaintiff
`A.
`39. Plaintiff, the State of Arkansas. The State of Arkansas is the sole
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`Plaintiff in this action, brought in its name on relation of the Attorney General Leslie
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`Rutledge. The Attorney General is the chief legal officer of the State and, pursuant
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`to Ark. Code Ann. § 4-88-104, § 4-88-105, and § 4-88-113, represents and protects the
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`state, its subdivisions, the legitimate business community, and the general public as
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`consumers and has the authority to bring actions for civil enforcement of the
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`Arkansas Deceptive Trade Practices Act (the “ADTPA”). The State also brings this
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`case in a parens patriae capacity to protect the marketplace in Arkansas and the
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`safety, health, and economic well-being of its citizens.
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`40.
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`The State brings this action under, inter alia, provisions of the ADTPA,
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`Ark. Code Ann. §§ 4-88-101, et seq., the common law of the State of Arkansas, and
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`the common law and statutory authority of the Attorney General to represent the
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`State.
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`B. Manufacturer Defendants
`41. Defendant Eli Lilly and Company (“Eli Lilly”) is an Indiana
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`corporation with its principal place of business at Lilly Corporate Center,
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`Indianapolis, Indiana 46285.
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`42. Eli Lilly is registered to do business in Arkansas and may be served
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`through its registered agent: National Registered Agents, Inc., 124 W. Capitol Avenue,
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`Suite 1900, Little Rock, Arkansas 72201.
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`43. Eli Lilly holds five active Wholesale Distributor Licenses (License Nos.
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`WD00285, WD02616, WD04698, WS01286, WD01287) in Arkansas.
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`44.
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`These licenses allow Eli Lilly to manufacture, distribute, and sell its at-
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`issue drugs in Arkansas.
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`45.
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`In Arkansas, Eli Lilly promotes and distributes several at-issue diabetes
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`medications: Humulin N, Humulin R, Humalog, Trulicity, and Basaglar.
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`46. Eli Lilly’s global revenues in 2019 were $4.13 billion from Trulicity, $2.82
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`billion from Humalog, $1.29 billion from Humulin, and $1.11 billion from Basaglar.
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`47. Eli Lilly’s global revenues in 2018 were $3.2 billion from Trulicity, $2.99
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`billion from Humalog, $1.33 billion from Humulin, and $801 million from Basaglar.
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`48. Eli Lilly transacts business in Arkansas, targeting Arkansas for its
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`products, including the at-issue diabetes medications.
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`49. Eli Lilly employs sales representatives throughout Arkansas to promote
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`and sell Humulin N, Humulin R, Humalog, Trulicity, and Basaglar.
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`50. Eli Lilly also directs advertising and informational materials to
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`Arkansas physicians, payors, and diabetics for the specific purpose of selling more of
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`the at-issue drugs in Arkansas and profiting from the Insulin Pricing Scheme.
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`51. At all times relevant hereto, in furtherance of the Insulin Pricing
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`Scheme, Eli Lilly caused its artificially inflated list prices for the at-issue diabetes
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`medications to be published throughout Arkansas with the express knowledge that
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`Arkansas residents with diabetes and the State’s payments and reimbursements
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`would be based on those prices.
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`52. During the relevant time period, the State purchased Eli Lilly’s at-issue
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`diabetes medications at a price based on inflated list prices generated by the Insulin
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`Pricing Scheme through its employee health plans and for use in state-run facilities.
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`53. During the relevant time period, residents in Arkansas with diabetes
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`spent millions of dollars per year out of pocket on Eli Lilly’s at-issue drugs also based
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`on Eli Lilly’s artificially inflated list prices.
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`54. Arkansas diabetics and the State paid for all of the Eli Lilly diabetes
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`medications related to the at-issue transactions in Arkansas based on the specific
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`inflated list prices Eli Lilly caused to be published in Arkansas in furtherance of the
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`Insulin Pricing Scheme.
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`12
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`55. Defendant Sanofi-Aventis U.S. LLC (“Sanofi”) is a Delaware limited
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`liability company with its principal place of business at 55 Corporate Drive,
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`Bridgewater, New Jersey 08807.
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`56.
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`Sanofi may be served through its registered agent: Corporation Service
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`Company, 251 Little Falls Drive, Wilmington, Delaware 19808.
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`57.
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`Sanofi holds three active Wholesale Distributor Licenses (License Nos.
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`WD01143, WD02241, WD04420) in Arkansas.
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`58.
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`These licenses allow Sanofi to manufacture, distribute, and sell its at-
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`issue drugs in Arkansas.
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`59.
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`Sanofi promotes and distributes pharmaceutical drugs in Arkansas,
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`including several at-issue diabetes medications: Lantus, Toujeo, Soliqua, and Apidra.
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`60.
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`Sanofi’s global revenues in 2019 were $3.50 billion from Lantus, $1.03
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`billion from Toujeo, $400 million from Apidra, and $144 million from Soliqua.
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`61.
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`Sanofi’s global revenues in 2018 were $3.9 billion from Lantus, $923
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`million from Toujeo, $389 million from Apidra, and $86 million from Soliqua.
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`62.
`
`Sanofi transacts business in Arkansas and targets Arkansas for its
`
`products, including the at-issue diabetes medications.
`
`63.
`
`Sanofi employs sales representatives throughout Arkansas to promote
`
`and sell Lantus, Toujeo, Soliqua, and Apidra.
`
`64.
`
`Sanofi also directs advertising and informational materials to Arkansas
`
`physicians, payors, and diabetics for the specific purpose of selling more of the at-issue
`
`drugs in Arkansas and profiting from the Insulin Pricing Scheme.
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`65. At all times relevant hereto, in furtherance of the Insulin Pricing
`
`Scheme, Sanofi caused its artificially inflated list prices for the at-issue diabetes
`
`medications to be published throughout Arkansas with the express knowledge that
`
`payment and reimbursement by Arkansas diabetics and the State would be based on
`
`these prices.
`
`66. During the relevant time period, the State purchased Sanofi’s at-issue
`
`diabetes medications at prices based on artificially inflated list prices generated by
`
`the Insulin Pricing Scheme through its employee health plans and for use in state-run
`
`facilities.
`
`67. During the relevant time period, residents in Arkansas with diabetes
`
`spent millions of dollars per year out of pocket on Sanofi’s at-issue drugs also based
`
`on Sanofi’s artificially inflated list prices.
`
`68. Arkansas diabetics and the State paid for all of the Sanofi diabetes
`
`medications related to the at-issue transactions in Arkansas based on the specific
`
`inflated prices Sanofi caused to be published in Arkansas in furtherance of the Insulin
`
`Pricing Scheme.
`
`69. Defendant Novo Nordisk Inc. (“Novo Nordisk”) is a Delaware
`
`corporation with its principal place of business at 800 Scudders Mill Road, Plainsboro,
`
`New Jersey 08536.
`
`70. Novo Nordisk may be served through its registered agent: The
`
`Corporation Trust Company, 1209 Orange Street, Wilmington, Delaware 19801.
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`71. Novo Nordisk holds one active Wholesale Distributor License (License
`
`No. WD02464) in Arkansas.
`
`72.
`
`This license allows Novo Nordisk to manufacture, distribute, and sell its
`
`at-issue drugs in Arkansas.
`
`73. Novo Nordisk promotes and distributes pharmaceutical drugs in
`
`Arkansas, including the at-issue diabetic medications: Novolin R, Novolin N, Novolog,
`
`Levemir, Tresiba, Victoza, and Ozempic.
`
`74. Novo Nordisk’s global revenues in 2019 were $2.89 billion from Novolog,
`
`$973 million from Levemir, $968 million from Tresiba, $2.29 billion from Victoza,
`
`$248.3 million from Novolin, and $1.17 billion from Ozempic.
`
`75. Novo Nordisk’s global revenues in 2018 were $4.19 billion from Novolog,
`
`$1.66 billion from Levemir, $1.19 billion from Tresiba, $3.61 billion from Victoza,
`
`$284.5 million from Novolin, and $185 million from Ozempic.
`
`76. Novo Nordisk transacts business in Arkansas, targeting Arkansas for its
`
`products, including the at-issue diabetes medications.
`
`77. Novo Nordisk employs sales representatives throughout Arkansas to
`
`promote and sell Novolin R, Novolin N, Novolog, Levemir, Tresiba, Victoza, and
`
`Ozempic.
`
`78. Novo Nordisk also directs advertising and informational materials to
`
`Arkansas physicians, payors, and diabetics for the specific purpose of selling more of
`
`the at-issue drugs in Arkansas and profiting from the Insulin Pricing Scheme.
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`79. At all times relevant hereto, in furtherance of the Insulin Pricing
`
`Scheme, Novo Nordisk caused its artificially inflated list prices for the at-issue
`
`diabetes medications to be published throughout Arkansas with the express
`
`knowledge that Arkansas diabetics and the State paid for the at-issue drugs based on
`
`these prices.
`
`80. During the relevant time period, the State purchased Novo Nordisk’s at-
`
`issue diabetes medications at prices based on artificially inflated list prices generated
`
`by the Insulin Pricing Scheme through its employee health plans and for use in state-
`
`run facilities.
`
`81. During the relevant time period, residents in Arkansas with diabetes
`
`spent millions of dollars per year out of pocket on Novo Nordisk’s at-issue drugs also
`
`based on Novo Nordisk’s artificially inflated list prices.
`
`82. Arkansas diabetics and the State paid for all of the Novo Nordisk
`
`diabetes medications related to the at-issue transactions in Arkansas based on the
`
`specific inflated prices Novo Nordisk caused to be published in Arkansas in
`
`furtherance of the Insulin Pricing Scheme.
`
`83. Collectively, Defendants Eli Lilly, Novo Nordisk, and Sanofi are referred
`
`to as “Manufacturer Defendants” or “Manufacturers.”
`
`PBM Defendants
`C.
`84. Defendant CVS Health Corporation (“CVS Health”) is a Delaware
`
`corporation with its principal place of business at One CVS Drive, Woonsocket, Rhode
`
`Island 02895. CVS Health transacts business and has locations throughout the United
`
`States and Arkansas.
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`85. CVS Health may be served through its registered agent: The Corporation
`
`Trust Company, Corporation Trust Center, 1209 Orange Street, Wilmington,
`
`Delaware 19801.
`
`86. CVS Health, through its executives and employees, is directly involved
`
`in the PBM services and formulary construction related to the Insulin Pricing Scheme
`
`that gave rise to the State’s claims.
`
`87. During the relevant time, CVS Health (or its predecessor)4 has
`
`repeatedly, continuously, and explicitly stated that CVS Health:
`
`a. “design[s] pharmacy benefit plans that minimize the costs to the client
`while prioritizing the welfare and safety of the clients’ members and
`helping improve health outcomes;”5
`
`
`b. “negotiate[s] with pharmaceutical companies to obtain discounted
`acquisition costs for many of the products on [CVS Health’s] drug lists,
`and these negotiated discounts enable [CVS Health] to offer reduced
`costs to clients;”6
`
`c. “utilize[s] an independent panel of doctors, pharmacists, and other
`medical experts, referred to as its Pharmacy and Therapeutics
`Committee, to select drugs that meet the highest standards of safety
`and efficacy for inclusion on [CVS Health’s] drug lists.”7
`
`88. CVS Health publicly represents that CVS Health constructs programs
`
`
`
`
`
`that lower the costs of the at-issue diabetes medications. For example, in 2016, CVS
`
`
`4 Until 2014, CVS Health was known as “CVS Caremark.” In September 2014, CVS
`Caremark Corporation announced that “it is changing its corporate name to CVS Health to
`reflect its broader health care commitment and its expertise in driving the innovations
`needed to shape the future of health.”
`5 CVS Caremark/CVS Health, Annual Reports (Form 10-K) (Dec. 31, 2009-2019).
`6 CV