Michigan Supreme Court Overturns Insulin Pricing Ruling, Impacting Eli Lilly Case
The Michigan Supreme Court has set a new precedent by siding with the state’s Attorney General in a legal battle involving drug manufacturer Eli Lilly. This decision, made on Friday, comes as a critical development in the ongoing scrutiny of insulin pricing practices.
In 2022, Michigan Attorney General Dana Nessel initiated an investigation into the pricing of insulin, invoking the Michigan Consumer Protection Act. This law, however, includes a provision that exempts government-licensed businesses from certain regulations. Historically, court interpretations in 1999 and 2007 have applied this exemption broadly, shielding businesses even when they engaged in questionable practices.
Eli Lilly, known for producing Humalog insulin, leveraged this exemption to successfully contest the subpoenas aimed at examining their pricing strategies. However, a close 4-3 decision by the Michigan Supreme Court has now reversed this longstanding interpretation.
Attorney General Nessel has expressed the significance of this decision, highlighting the problematic nature of the previous interpretation. In a video statement, she explained, “If a business held any kind of license or occupational credential, they became untouchable. Even if their misconduct had nothing to do with the rules or laws that applied to their licensure.”
Despite the favorable ruling, Nessel’s office has not formally alleged any wrongdoing by Eli Lilly at this stage. This lack of accusation prompted a unique dissent from justices across ideological lines. Justices Kyra Harris Bolden, David Bernstein, and conservative Justice David Viviano opposed the ruling, citing a lack of controversy. Bolden, writing for the dissent, argued, “Without trying to argue a violation of the MCPA, there’s no actual controversy. Fundamental to obtaining declaratory relief on the parties’ rights and obligations under the MCPA is asserting that a violation of the MCPA may have occurred.”
The case has now been remanded to the circuit court for further proceedings.
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