Eli Lilly (NYSE:LLY) must pay $183.7M as damages in a lawsuit alleging that the Indiana-based drugmaker defrauded the Medicaid drug pricing program, a federal appeals court ruled on Thursday, upholding a lower court ruling.
In August 2022, a federal jury ordered Lilly (NYSE:LLY) to pay $61M in a lawsuit filed by whistleblower Ronald Streck—a pharmacist and lawyer—who alleged that the company retroactively increased prices for some drugs but failed to rebate Medicaid based on the higher prices.
The trial judge later determined that the company actually owes $183M under the “trebled” damages rules in the False Claims Act.
The U.S. Court of Appeals for the Seventh Circuit in Chicago rejected several challenges to the award, noting that the jury had reasonably found that the weight loss drugmaker had knowingly concealed price hikes and failed to rebate Medicaid for higher prices.
The jury heard “ample evidence” indicating that the company “was aware of, or disregarded, an unjustifiable risk of skirting the law and chose to obfuscate rather than conduct a reasonable inquiry,” Reuters reported, quoting Circuit Judge Joshua Kolar.
The three-judge panel also rejected Streck’s claim that LLY should face a harsher penalty, as the trial judge undercounted its violations of the federal False Claims Act.