Regeneron (NASDAQ:REGN) has been accused by the U.S. Justice Department of manipulating Medicare drug pricing of its macular degeneration drug, Eylea. The Department of Justice’s (DoJ) complaint alleges that the biotech company falsely inflated Medicare reimbursement rates for Eylea, excluding certain price concessions
Medicare is a government healthcare program for people aged 65 years and older. People covered under this program are reimbursed for the healthcare costs that they may incur.
The DoJ filed the complaint in federal court in Boston, alleging that Regeneron didn’t disclose that it helped pay for Eylea’s purchases by reimbursing distributors for credit card fees. As a result, the lawsuit claims that the drugmaker violated the False Claims Act, which prohibits submitting false claims to the government for payment.
Furthermore, the DoJ stated that the medication had a wholesale acquisition cost of $1,850 per vial and was a significant expense for Medicare. Additionally, the government paid out over $25 billion for Eylea from 2012 to 2023.
On its part, Regeneron stated that the allegations were without merit and that it would “vigorously defend itself in court.”
Is REGN a Good Stock to Buy?
Analysts are bullish about REGN stock, with a Strong Buy consensus rating based on 17 Buys, three Holds, and one Sell. Over the past year, REGN has increased by more than 10%, and the average REGN price target of $1,037.89 implies an upside potential of 10.6% from current levels.
