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Rockford Sues Over Drug Price Hike

Flickr user / Images Money "Healthcare Costs" (CC BY 2.0)

The City of Rockford is suing Mallinckrodt Pharmaceuticals over a drug price hike. It purchased the U.S. rights to Acthar, a medicine used to treat "infantile spasms," a rare seizure disorder.  

Mallinckrodt hiked the price from $40 per vial in 2001 to $35,000 per vial today.  Furthermore, the company paid $100 million to the Federal Trade Commission over charges that it was maintaining an illegal monopoly of the drug.

Rockford is a self-insured city, and provides health care for more than 3000 people, including employees and their families. At least two individuals covered by these services were treated with Acthar.  The city's suit aims to recoup nearly half a million dollars in extra costs from what they view as significant overpayment.

It’s possible other self-insured entities, like Winnebago County and Rockford Public Schools, could join the suit if their residents were treated with the drug.