Broward County Commission Regular Meeting
Director's Name: Andrew J. Meyers
Department: County Commission
Information
Requested Action
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MOTION TO AUTHORIZE County Attorney to select a law firm to file a lawsuit against pharmaceutical manufacturers and pharmacy benefit managers related to insulin; authorize the County Attorney to negotiate, on behalf of the County, a contingency fee agreement with outside counsel, consistent with the below-stated parameters; authorize the County Administrator to execute such agreement, subject to approval as to legal sufficiency by the County Attorney’s Office; authorize the filing of the referenced lawsuit; and authorize the County Administrator to take all necessary administrative and budgetary actions.
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Why Action is Necessary
The County Attorney may only appoint outside counsel, and the County may only enter into an agreement for legal services, with Board approval.
What Action Accomplishes
Retention of outside counsel will allow the County to file a lawsuit against insulin drug manufacturers and pharmacy benefit managers.
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☐County Commission
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Previous Action Taken
Summary Explanation/Background
Insulin is a hormone naturally produced by the body that helps regulate blood sugar levels and allows the body to use glucose (a type of sugar) for energy. For many individuals with diabetes, insulin drug therapy is essential for survival.
Reports indicate that while insulin use has only risen modestly over the years, the prices of all types of insulin and insulin products have increased substantially. As a result of the dramatic increase in the cost of insulin, the County, which is self-insured for health and pharmacy benefits, has paid significantly more each year for insulin.
State and local governments, unions, and other purchasers of insulin have filed lawsuits alleging that insulin drug manufacturers and pharmacy benefit managers are engaged in pricing schemes. These lawsuits are being coordinated in multidistrict litigation in the United States District Court for the District of New Jersey. Multidistrict litigation allows civil actions from different district courts to be temporarily consolidated to a single district court for pretrial proceedings, after which they are generally returned to their original courts for trial if necessary.
The County Attorney’s Office has been monitoring the pending litigation; for reasons that will be addressed during individual agenda briefings, we believe the County’s interests are best protected by being prepared to file a lawsuit in the near term.
Any proposed agreement with outside counsel would include the following terms: (1) a contingency fee arrangement in which outside counsel would receive a maximum of 25% of the monetary recovery; (2) outside counsel would advance all costs and expenses of litigation and agrees that the County is only obligated to reimburse such costs and expenses out of any monetary recovery; (3) attorney fee insurance, if reasonably available; and (4) if outside counsel contracts to represent certain governmental entities in insulin litigation at a lower contingency fee or a lower cap on costs, or if such contract more narrowly defines the recoveries to which the contingency fee would apply, the County must be offered such terms.
Source of Additional Information
Adam Katzman, Deputy County Attorney, 954-357-7600
Fiscal Impact
Fiscal Impact/Cost Summary
The County will be required to pay costs and expenses advanced by outside counsel if the County receives a monetary recovery. Additionally, depending on the litigation outcome, the County may be responsible for certain opposing counsel fees; however, the County is seeking to mitigate this exposure through attorney fee insurance.