Eli Lilly and Co. and Health Care Businesses and Health Care & Life Sciences and Health Care & Insurance and Pharmaceutical

Lilly to pay Idaho $13M in drug settlement

October 14, 2009

Idaho is getting $13 million as part of a settlement reached with Indianapolis-based Eli Lilly and Co. over its marketing of an anti-psychotic drug.

Attorney General Lawrence Wasden announced the deal Tuesday, calling it the largest financial settlement in a legal case since Idaho and other states ended a lawsuit with tobacco companies in 1998.

Idaho sued Eli Lilly over allegations the company used deceptive marketing strategies for the drug Zyprexa. The state accused the company of failing to warn doctors of the drug's serious side effects, a move that caused significant costs to the state's Medicaid program.

Idaho also claimed Zyprexa, approved for severe psychological disorders, caused consumers to gain weight, leading to other problems like diabetes.

Wasden said the $13 million will offset losses incurred by Idaho's Medicaid program.

Zyprexa, which boasts $4.7 billion in annual sales, has cost Lilly lots of legal trouble, sparking thousands of patient lawsuits as well as investigations by federal and state governments.

In January, Lilly agreed to pay $1.42 billion to federal and state governments to resolve a lawsuit over Zyprexa marketing brought by the U.S. Justice Department. Some states, including Idaho, did not join that settlement.

More than 30 states sued Lilly over Zyprexa. The only case that went to trial was in Alaska, which ended with a settlement that calls for Lilly to pay the state $15 million.

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