The city of Marietta, Ga., has joined a growing list of unions and local governments to file a lawsuit contending Mallinckrodt (MNK) caused them to spend excessively for a medicine because of its high price. The city also alleges the company used several purportedly inappropriate tactics designed to boost usage.
In their lawsuit, Marietta officials argued the city’s self-funded health plan was forced to spend more than it should have because of the “exorbitant and unconscionable” price charged for Acthar Gel, which is used to treat infantile spasms and relapsing multiple sclerosis.
The city noted the list price was around $40 in 2001, but by last year stood at more than $39,000 for a vial, an “eye popping” 97,500% price increase, which was the result of “unlawful and unfair conduct,” according to the lawsuit. And since treatment usually requires at least three vials, a single course of treatment can cost nearly $120,000. As a result, the city spent more than $2 million on just one patient.
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