Five Massachusetts hospitals sue Eli Lilly to protect patient privacy and restore federally mandated drug discounts
Boston, Mass. – Massachusetts General Hospital, Brigham and Women's Hospital, Salem Hospital, UMass Memorial Medical Center and UMass Memorial Health – Harrington Hospital today sued Eli Lilly and Company (Lilly) in federal court in Massachusetts. The suit challenges a Lilly policy that requires hospitals to hand over medical claims data in order to receive drug discounts guaranteed by federal law.
Under the federal 340B Drug Pricing Program, drug makers must offer discounts on outpatient medicines to hospitals that care for large numbers of low-income and underinsured patients. In 2026, Lilly began requiring hospitals to submit claims data through a platform Lilly chose. That platform's non-negotiable terms grant permanent rights to use the data for Lilly’s own purposes and cap its liability at $100. When the hospitals asked how patient information would be protected, Lilly cut off their discounts instead of answering.
"Our patients trust us with their most personal information and protecting that trust is part of caring for them," said Patrick Gordan, MD, Associate Chief Medical Officer, Salem Hospital. "340B savings help keep community health centers open, bring heart health and cancer screenings to neighborhoods through our mobile vans, and put fresh food within reach of families who need it. No hospital should have to hand over patient data to keep those benefits flowing to the communities Congress meant to help."
The hospitals have forgone vital 340B savings and paid the higher drug costs themselves so patients can keep getting their Lilly medications. Annualized, the impact is tens of millions of dollars, including at least $20 million a year at UMass Memorial.
“340B savings provide an essential lifeline for patients with chronic and complex health conditions and allow us to fund health programs that support the vulnerable patient populations and communities we serve,” said Eric Dickson, MD, President and CEO of UMass Memorial Health. “Eli Lilly’s 340B policy forces hospitals into an unconscionable choice: surrender sensitive medical claims information or lose vital savings that directly support patient and community-based care. We refuse to hand over medical claims information that Eli Lilly as a drug manufacturer doesn’t need. UMass Memorial is committed to doing its part to put an end to this exploitative practice that harms both patients and hospitals.”
At UMass Memorial, 340B savings help fund free care and dental services at 28 public schools, a mobile addiction treatment team and medical respite beds for people experiencing homelessness. At Mass General Brigham, they help support community health centers, mobile care vans for heart health and cancer screening, and mobile food markets.
The hospitals support appropriate oversight of the 340B program and already take part in federal audit and compliance processes. The lawsuit asks the court to stop Lilly from enforcing the policy, to restore 340B pricing and to award damages, including what the hospitals have overpaid.
Media contact
Kelly Mitchell
kmitchell28@mgb.org
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