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U.S. probes contracts between Eli Lilly and PBMs

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(Reuters) — Eli Lilly and Co. said it received a civil investigative demand from the U.S. attorney's office for the southern district of New York, requesting documents and information relating to contracts with pharmacy benefit managers.

Pharmacy benefit managers, which administer drug benefits for employers and health plans and also run large mail-order pharmacies, have been challenging the rising cost of new medications.

When drugs are knocked off their formularies, patients may have to pay full price for them. PBMs often keep or dump a product depending on whether they can obtain favorable pricing.

“We are cooperating with this investigation,” the company said in a regulatory filing on Thursday. Lilly did not disclose the name of any PBM in the filing.

The investigation comes nearly three months after federal prosecutors sought information from Johnson & Johnson, Merck & Co and Endo International P.L.C. about their contracts with pharmacy benefit managers.