AbbVie Inc. v. Payer Matrix, LLC, No.
23 CV 2836, 2025 WL 2374490 (N.D. Ill. Aug. 15, 2025)
AbbVie sells the specialty drugs Humira, Skyrizi, and
Rinvoq. Payer Matrix is “an alternative funding provider that works with
self-funded health plans to lower their specialty drug costs.” AbbVie brought
various claims against Payer Matrix based on Payer Matrix’s alleged involvement
with AbbVie’s charitable programs, including AbbVie’s Patient Assistance
Program (PAP) and Co-Pay Assistance Program (CAP). AbbVie also brought claims
based on Payer Matrix allegedly facilitating the importation of AbbVie drugs
from Canada. The court allows some claims to proceed, including trademark
claims despite the sophistication of the consumers.
A RICO claim survived, amazingly enough.
Lanham Act false association: AbbVie’s complaint identified
a Payer Matrix presentation “showing AbbVie’s trademark-protected logo and the
trademarks of other pharmaceutical manufacturers under a title ‘We partner with
top manufacturers.’ ” OK, even I would not say “partner with” is ok absent a relationship.
On the other hand, the court also thought another statement
in a presentation plausibly suggested a business relationship, which seems
silly to me. Discussing a slide that included AbbVie’s logo under a title “Top
Manufacturers,” the presenter said pharmaceutical manufacturers were putting
specialty drugs “down two runways”:
One is the traditional plan sponsor
access system, by which you’re paying probably 1,000 times what it costs them
to make the drug, and then there’s another pathway you can follow, which is the
Manufacturer Assistance Program, and really, what these big pharma
organizations are doing is they’re allowing access on both sides, but frankly,
a lot of people don’t know how to get access to the side that’s significantly
reduced in cost, and they do it for a variety of reasons ... but the bottom
line is we’re a model that’s actually helping plans tap into these programs,
which are overfunded and underutilized.
Then, back to something that is a bit more plausible, the
presenter “told his audience that by permitting Payer Matrix access to its PAP
and CAP programs, AbbVie was improving its reputation; earning a tax deduction;
and ‘expand[ing] the net of who they’re getting onto these particular drugs.’”
And then back to silly: AbbVie also alleged that other Payer Matrix “marketing
materials deceptively represent[ed] that its program leverages ‘extensive,
often unused funds made available by Pharma Manufacturers.’ ”
As a whole, “these statements could plausibly confuse a plan
sponsor into believing that AbbVie approved of Payer Matrix’s PAP and CAP
activities.” The court emphasized the bad “[w]e partner with top manufacturers”
slide, as well as an allegation that at least one plan sponsor working with
Payer Matrix “was led to believe and represented to its members that Payer
Matrix seeks ‘grant money’ from pharmaceutical companies to reduce the cost of
some specialty drugs.” But the court also highlighted the statement that AbbVie
“win[s] from a financial standpoint” by accepting patients into its “overfunded
and underutilized” PAP, reasoning that “a plan sponsor could rationally
understand such a statement to mean that AbbVie endorses Payer Matrix’s scheme
of enrolling members in the PAP.” This seems clearly fixable with a proximate
disclaimer (and eliminating the partnership language).
“Partner” was also not puffery, since it has a defined
meaning, i.e., “to join with another person or
organization in a business activity.” Nor was client sophistication enough
to defeat the argument at the pleading stage.
As to drug importation, AbbVie alleged that the medicines
Payer Matrix imports, or helps import, from Canada are “likely to cause
consumer confusion, given the material differences between these medicines and
their domestic counterparts.” AbbVie argued that it only needed to show a
material difference in the products, but § 1125(a)(1)(A) still requires a false
or misleading representation “likely to confuse or deceive their audience about
the plaintiff’s ‘affiliation, connection, or association’ with the defendant
‘or as to the origin, sponsorship, or approval of his or her goods, services,
or commercial activities.’ ”
And “the closest AbbVie comes to meeting this mark is its
allegation that Payer Matrix advertises RxFree4Me’s Canadian-sourced medicines
as the ‘same brand medications.’” That “says nothing about whether AbbVie
sponsors or approves of the drugs’ importation and the processes and procedures
through which the importation happens.” Thus, it wasn’t plausible that AbbVie would
be held “responsible for any medicine shipping delays and any counterfeit,
adulterated, mislabeled, ineffective, or spoiled product that [patients]
receives through Payer Matrix’s program.” And, while “same brand” “inherently
suggests some affiliation or association between AbbVie and the imported
AbbVie-branded drugs, AbbVie also alleges nothing to suggest that this
intimation was, in fact, false or deceptive.” This is a really useful point
about grey market goods—if they’re imported not for resale by someone who
understands they’re importing, then there’s really nothing misleading even if
there are material differences.
False advertising: AbbVie challenged: (1) advertisements on
Payer Matrix’s website saying that patients will not experience any disruption
or change in their specialty drug access, (2) statements Payer Matrix made to
doctors during drug-conversion efforts, (3) statements made to plan sponsors,
brokers, and doctors about AbbVie’s restrictions on PAP access, (4) Payer
Matrix’s representations that the imported AbbVie medicines come from
“legitimate and valid” sources, and (5) Payer Matrix’s statements about
partnering with AbbVie.
Ads claiming no disruption or change in access: Payer
Matrix’s website read: “[M]embers are not disrupted and always receive their
medications. There is no interruption in supply, no requirements to change
brands or dosing, the only difference is the source of the medication, and of
course the reduced costs.” AbbVie alleged falsity because (1) “members do in
fact have interruption in supply, including medicine delays,” (2) “Payer Matrix
does ask the members’ [health care providers (“HCPs”)] to change their medicine
brands when Payer Matrix is unable to maneuver the members into AbbVie’s PAP,”
and (3) “the statement that ‘the only difference is the source of the
medication’ misleadingly suggests that Payer Matrix is the members’ new
insurance provider for their specialty drugs.”
Payer Matrix argued that AbbVie’s injury was not proximately
caused by these statements. But “AbbVie’s
theory of economic harm is plausible: when the advertisement turns out to be
false, customers may very well wrongly blame AbbVie—not Payer Matrix—for
interruptions in supply or changes to their medications…. At this early stage,
AbbVie plausibly pleads under Lexmark that its reputation was harmed by
the allegedly false representations on Payer Matrix’s website.”
Statements to doctors: AbbVie alleged false and misleading
statements to doctors that the patients no longer had the ability to obtain
their AbbVie drug and that the HCPs, therefore, had no choice but to change
their prescriptions.” Allegedly, “Payer Matrix employees would typically tell
the HCPs that the patients were uninsured for specialty drugs and/or no longer
had access to AbbVie’s PAP, often disparaging and blaming AbbVie in the
process.”
But these statements weren’t made “in commercial advertising
or promotion.” Whether this violated other laws was “beside the point”: when talking
to doctors, “Payer Matrix was not trying to ‘promote’ or ‘advertise’ anything”
but to persuade doctors to switch prescriptions. “[I]f Payer Matrix were trying
to promote its services, the ‘relevant purchasing public’ would be plan
sponsors and their brokers—not doctors.”
Alleged disparagement campaign: Payer Matrix emails
allegedly stated that: (1) “AbbVie has cut off PAP access to any patients
working with third parties and patient advocacy groups,” (2) “AbbVie has shut
the door on PAP to those who are underinsured,” (3) “AbbVie has been converting
existing Humira patients to Skyrizi for financial gain,” and (4) “AbbVie is no
longer accepting PAP applications at all.” Again, these weren’t commercial
advertising or promotion, but rather statements made in the course of “providing
services it had already agreed to provide”:
While some cases suggest that
statements made to a company’s existing customer base can support a Lanham Act
claim, the statements still must “advertise” or “promote” the company’s product
or services. These statements plainly did not. If anything, as Payer Matrix
points out, the statements would have deterred customers from working with
Payer Matrix “given that AbbVie[’s] own allegations contend that the accessibility
of PAP programs is a necessary prerequisite to Payer Matrix’s business model.”
Statements about imported drugs: AbbVie alleged that Payer
Matrix falsely claimed “that the medicines obtained through its importation
program ... come from ‘legitimate and valid sources,’ despite the fact that
these medicines are being illegally imported from outside the United States.” This
was ambiguous: “generic words such as ‘legitimate’ and ‘valid’ cannot
reasonably be construed as synonymous with ‘FDA-approved’ or ‘FDCA-compliant.’
” Also, Payer Matrix said that, as part of RxFree4Me’s international drug
sourcing program, “[m]embers receive their same brand medications delivered to
their door for a $0 copay.” AbbVie didn’t allege that the imported medicines
are not actually AbbVie-brand medicines. A reasonable person would not be
misled into thinking that “same brand” means “same regulatory approval
process.” Motion to dismiss as to these allegations granted.
Partnership/approval statements: Again, partnership was
objectively verifiable and “plainly goes to the nature of Payer Matrix’s
services.” (The other statements, though, seem at least ambiguous to me.)
Still, it was “plausible that a plan sponsor listening to Payer Matrix’s
presentations could be misled into thinking that AbbVie endorses (and even
aids) Payer Matrix’s methods for enrolling its members in AbbVie’s PAP and CAP
and that this plan sponsor would be persuaded to procure Payer Matrix’s
services as a result.” [What harm does this do AbbVie?]
State law claims: Illinois Consumer Fraud and Deceptive
Business Practices Act (ICFA), tortious interference, and common law fraud
claims all turned on whether Payer Matrix misrepresented members’ coverage
status. When facilitating its members’ PAP applications, Payer Matrix submitted
requests to AbbVie saying that its members were “responsible for 100% of the
cost of their drugs or that their drugs have been excluded from their plans’
formularies.” To the contrary, AbbVie alleged that the member’s employer (i.e.,
the plan sponsor) had every intention of covering the cost of the drug if the
member was ultimately denied from AbbVie’s PAP. It alleged that Payer Matrix’s
“clients’ amended [Summary Plan Descriptions] ... commonly contain language
informing members that their specialty drugs will continue to be covered by the
plan if Payer Matrix is unable to obtain alternate funding” and that Payer
Matrix’s client brochures and marketing materials say the same, “confirming
that overrides are granted as a matter of course when PAP admission is denied
and that the purported specialty drug exclusion is a sham.” Thus, AbbVie
plausibly alleged that Payer Matrix misrepresented the truth when it
communicated to AbbVie that members were responsible for 100% of the cost of
their drugs.
Payer Matrix argued that AbbVie did not rely on the submissions
“given that [AbbVie] conducted independent benefits investigations,” but AbbVie
alleged otherwise. And Payer Matrix was plausibly responsible even if patients
formally certified the forms, given allegations that Payer Matrix (1) submitted
the forms knowing they falsely represented the members’ insurance status, (2)
concealed the relevant terms from patients who signed the applications, and (3)
provided PBMs and plan sponsors with the forms template.
ICFA: As a non-consumer, AbbVie needed a “consumer nexus,” that
is, it needed to show that “the alleged conduct involves trade practices
addressed to the market generally or otherwise implicates consumer protection
concerns.” Non-consumers need to show that their actions were akin to a
consumer’s actions. “Consumer protection concerns” are implicated where the
defendant’s conduct “involves sharp practices designed to mislead consumers
about a competitor” or “public health, safety or welfare issues.”
AbbVie didn’t satisfy this standard. “Even if Payer Matrix’s
allegedly deceptive conduct might ultimately hurt specialty drug patients,
AbbVie does not act in a role akin to a consumer when it accepts or denies
patients from its PAP and CAP.” While consumers could be harmed by delays in
getting their drugs, having prescriptions changed unnecessarily, and related
uncertainty, the harm to AbbVie was primarily economic: “an increase in the
operational costs associated with its patient assistance programs and a loss of
sales.” Operational and financial issues are distinct to access-to-health-care
issues, and awarding AbbVie economic damages would not “serve the interests of
consumers.” Dismissed with prejudice.
Illinois Uniform Deceptive Trade Practices Act: the prohibitions
on confusion and false advertising parallel the Lanham Act, above. AbbVie
argued that, “for IDTPA liability, deceptive statements do not have to occur in
the context of commercial advertising.” But an IDPTA claim requires
“advertising,” and the Seventh Circuit has previously applied its Lanham Act
standard unchanged, so the court didn’t agree.
Tortious interference: In Illinois, a plaintiff must prove:
“(1) his reasonable expectation of entering into a valid business relationship;
(2) the defendant’s knowledge of the plaintiff’s expectancy; (3) purposeful
interference by the defendant that prevents the plaintiff’s legitimate
expectancy from ripening into a valid business relationship; and (4) damages to
the plaintiff resulting from such interference.”
To the extent AbbVie’s tortious interference claim relied on
Payer Matrix’s facilitation of imported drugs from Canada, AbbVie’s claim failed
because there were no allegations that Payer Matrix made any false or
misleading statements about the imported drugs or that Payer Matrix falsely
said they are FDA-approved.
However, Payer Matrix’s facilitation of PAP applications and
drug-conversion efforts could plausibly be tortious interference.
Common-law fraud: AbbVie alleged that Payer Matrix fraudulently
represented to AbbVie that PAP applicants lacked commercial insurance coverage
for Skyrizi, Humira, and Rinvoq, even though the plans guaranteed coverage for
those medicines if they were denied PAP benefits. This requires: “(1) a false
statement of material fact; (2) defendant’s knowledge that the statement was
false; (3) defendant’s intent that the statement induce the plaintiff to act;
(4) plaintiff’s reliance upon the truth of the statement; and (5) plaintiff’s
damages resulting from reliance on the statement.” This was plausibly pled.
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