The State of Texas has filed a lawsuit against Eli Lilly, alleging that the drugmaker provided unlawful incentives to healthcare professionals to encourage prescriptions of its star GLP-1 medicines, Zepbound and Mounjaro.
In a statement issued Tuesday, Attorney General Ken Paxton claimed that Lilly undermined medical judgment by participating in an illegal kickback arrangement.
Paxton added that Eli Lilly had allegedly engaged in fraudulent actions to boost profits at the expense of taxpayers, prioritizing corporate gain over the well-being of individuals.
The 24-page lawsuit, submitted to the District Court of Texas, alleges that Lilly operated two initiatives to encourage providers to prescribe its medicines, enabling the company to compete in a market crowded with drugs that offer – or claim to offer – comparable therapeutic outcomes.
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Zepbound and Mounjaro in the Spotlight of Texas Litigation
The first initiative, labeled the “Free Nurse Program” in the complaint, allegedly provided patient-care services free of charge to healthcare providers as a means of influencing them to prescribe Lilly’s treatments. The second, referred to as the “Support Services Program,” offered reimbursement assistance. In addition to Zepbound and Mounjaro, the case also involves several other Lilly products, including the breast cancer therapy Verzenio and leukemia treatment Jaypirca, among others.
Paxton is seeking a jury trial and wants Lilly to pay civil damages along with other penalties, in addition to securing an injunction to prevent any further illegal conduct, according to the lawsuit.
In a statement, an Eli Lilly spokesperson rejected the allegations and stated that the company intends to mount a strong defense. The spokesperson also pointed out that various courts and federal authorities have previously dismissed similar claims against Lilly as baseless.
The comment referenced Health Choice Alliance, a relator based in New Jersey named as a co-plaintiff in the Texas case. In 2017, Health Choice Alliance took Lilly to court over alleged violations of the Anti-Kickback Statute and the False Claims Act, but the case was ultimately dismissed.
For Texas, this newest lawsuit comes on the heels of a similar complaint filed last October, which alleged that Lilly, alongside other insulin makers and pharmacy benefit managers (PBMs), collaborated to deliberately and knowingly inflate insulin prices, with the manufacturers paying substantial, undisclosed fees to the intermediaries to secure placement of their products in PBM formularies.
A federal appeals court recently reinstated a proposed class action lawsuit accusing four major pharmaceutical companies, including Eli Lilly, of colluding to limit a government-required drug discount scheme, allegedly increasing expenses for safety-net hospitals and clinics that provide care to low-income individuals.
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As details emerge, the lawsuit highlights how zepbound has become focal in broader debates over pharmaceutical marketing ethics. Critics say incentive programs like those alleged — for example offering free nursing support or reimbursement services — risk swaying prescribers towards more profitable drugs rather than those best suited to patients.
Supporters of Lilly respond that patient support and administrative assistance are legitimate parts of health care delivery, especially for complex drug regimens, insurance navigation, or follow-ups. Lilly’s denial notes that many regulatory bodies have reviewed similar claims in past cases and found insufficient evidence to sustain legal liability.
If Texas succeeds, the case could trigger sizable financial liabilities for Lilly, including clawbacks of Medicaid payments, civil penalties, and directives to halt programs deemed improperly influential. It could also prompt other states to examine the role of manufacturer-provided services in influencing prescribing behavior, especially for GLP-1 drugs such as zepbound.
For patients prescribed zepbound, this legal contest adds another dimension of scrutiny amid debates over drug costs, insurance coverage, and access. Efforts to ensure transparency in marketing, disclosures of incentives, and robust oversight may follow, no matter the court outcome.
