Five Massachusetts hospitals have sued Eli Lilly and Company in federal court in Boston, saying the drugmaker cut off their federally required drug discounts because they refused to hand over patient claims data. Massachusetts General Hospital, Brigham and Women’s Hospital, Salem Hospital, UMass Memorial Medical Center and UMass Memorial Health-Harrington Hospital filed the 48-page complaint on October 27, 2026. “This case is about corporate extortion,” it begins. Lilly says the hospitals are “more concerned with hiding rampant abuse in the program than improving its integrity,” a spokesperson told MassLive.
The case is General Hospital Corp. v. Eli Lilly and Co., No. 1:26-cv-14855 (D. Mass.). We read the complaint in full. These are allegations; Lilly has not yet answered in court.
What the hospitals say happened
- The policy. In January 2026, Lilly began requiring hospitals that buy its drugs at 340B prices to submit pharmacy and medical claims data on those prescriptions through a third-party platform called 340B ESP, the complaint says. The hospitals say the data is protected health information under HIPAA, that the platform’s own expert analysis does not establish the data will stay de-identified, and that its non-negotiable terms cap the platform owner’s total liability at $100 and give Lilly “perpetual, sublicensable rights” to use the data.
- The refusal. All five hospitals refused. UMass Memorial wrote to Lilly in May with “significant” concerns, and MGH and Brigham raised theirs in calls and letters in May and June, according to the complaint.
- The cutoff. The complaint says Lilly directed wholesalers to stop offering the 340B price to Brigham and UMass Memorial on or about June 18, 2026, to MGH on or about July 2, and to Salem and Harrington on or about October 21.
- The cost. UMass Memorial faces annualized overpayments of “at least $20 million,” the complaint says, and MGH, Brigham and Salem together face “tens of millions of dollars” a year. As examples, it says MGH overpaid about $2,478 for a single package of the cancer drug Cyramza, and Brigham about $200 for a package of the Alzheimer’s drug Kisunla.
- Complaints to the government. Each hospital filed a notice of overcharge with the federal Health Resources and Services Administration, the last on October 27, the complaint says.
What they are asking for
The complaint has two counts: unfair and deceptive practices under the Massachusetts Consumer Protection Act, G.L. c. 93A, and unjust enrichment. The hospitals allege the violations were “willful and knowing,” which under Chapter 93A can mean double or treble damages and attorneys’ fees. They also ask for preliminary and permanent injunctions restoring 340B pricing and barring the data demand, restitution, and a jury trial.
What the hospitals and Lilly said
- UMass Memorial. “We refuse to hand over medical claims information that Eli Lilly as a drug manufacturer doesn’t need,” said Dr. Eric Dickson, president and CEO of UMass Memorial Health, according to MassLive.
- Salem Hospital. “No hospital should have to hand over patient data to keep those benefits flowing to the communities Congress meant to help,” said Dr. Patrick Gordon, associate chief medical officer, according to MassLive.
- Lilly. A spokesperson said the hospitals’ “refusal to share basic information about their 340B program with Lilly, information they routinely collect and provide to insurers every day,” shows they “are more concerned with hiding rampant abuse in the program than improving its integrity,” and that “Lilly will continue fighting to ensure this program serves patients instead of hospitals and their for-profit partners,” MassLive reported.
The law: 340B, and why this is a 93A case
- The discount. The 340B statute, 42 U.S.C. § 256b(a)(1), requires a participating manufacturer to “offer each covered entity covered outpatient drugs for purchase at or below the applicable ceiling price if such drug is made available to any other purchaser at any price.”
- Audits. Manufacturers may audit a hospital’s records that “directly pertain” to two program rules, the bans on duplicate Medicaid discounts and on reselling to non-patients, but only “in accordance with procedures established by the Secretary relating to the number, duration, and scope of audits,” § 256b(a)(5)(C). The hospitals say Lilly’s standing data demand bypasses that process.
- No federal lawsuit for overcharges. In Astra USA, Inc. v. Santa Clara County, 563 U.S. 110 (2011), the Supreme Court held that suits by 340B hospitals to enforce manufacturers’ pricing agreements with the government “are incompatible with the statutory regime,” because “Congress placed the Secretary (acting through her designate, HRSA) in control of §340B’s drug-price prescriptions.” That is why this complaint is built on state law. It says the hospitals “do not ask this Court to administer the 340B Program or substitute itself for HRSA” and instead seek relief for “Lilly’s independent violations of Massachusetts law.” Whether a 93A claim can proceed alongside the federal scheme is likely to be the first fight in the case.
Frequently asked questions
Which Massachusetts hospitals are suing Eli Lilly?
Massachusetts General Hospital, Brigham and Women’s Hospital, Salem Hospital, UMass Memorial Medical Center and UMass Memorial Health-Harrington Hospital, in a complaint filed October 27, 2026, in federal court in Boston.
What is the 340B program?
A federal program that requires drug manufacturers taking part in Medicaid to sell outpatient drugs to qualifying hospitals and clinics at or below a ceiling price. The hospitals use the savings to fund care for low-income and uninsured patients, the complaint says.
Does this affect patients’ prescriptions?
According to the complaint, the dispute is over the price the hospitals pay for Lilly drugs. The hospitals say paying full price drains money they use for charity care and community programs.
Sources: Complaint, General Hospital Corp. v. Eli Lilly and Co., No. 1:26-cv-14855 (D. Mass. filed Oct. 27, 2026), read in full, and the court docket; MassLive, October 29, 2026. 42 U.S.C. § 256b read at Cornell’s Legal Information Institute. Astra USA, Inc. v. Santa Clara County, 563 U.S. 110 (2011), read on CourtListener. These are allegations; no court has made findings. General information, not legal advice.