U.S. federal agencies investigate Merck, Lilly drug pricing

(Reuters) – Drugmakers Merck Co and Eli Lilly Co are being investigated by the U.S. Attorney’s Office in Pennsylvania and other federal agencies over drug pricing practices, the companies disclosed.

Merck, in a regulatory filing late on Thursday, said it had received a civil investigative demand from the attorney’s office over the pricing of its asthma inhaler product, Dulera. (http://1.usa.gov/1kyPGgR)

Merck said it was cooperating with the investigation.

Eli Lilly Co also disclosed in a regulatory filing last week that the Pennsylvania Attorney’s Office and the U.S. Department of Justice were investigating the company’s distribution deals with wholesalers.

Lilly said the investigation was looking into the company’s drug pricing in Medicaid rebate programs. The company said it was responding to the federal agencies. (http://1.usa.gov/1kfpZCg)

Merck’s disclosure comes days after a U.S. Senate panel launched a probe into drug pricing by companies including Valeant Pharmaceuticals International Inc and Turing Pharmaceuticals.

Drugmakers’ shares fell sharply in the past few weeks after Democratic presidential candidate Hillary Clinton criticized drug pricing on her campaign trail.

Shares of both Merck and Lilly were down 1 percent in afternoon trading on the New York Stock Exchange.

(Reporting by Vidya L Nathan in Bengaluru; Editing by Kirti Pandey; Editing by Saumyadeb Chakrabarty)

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