Texas Attorney General Ken Paxton has sued Eli Lilly, alleging the drugmaker offered illegal incentives to providers, leading to millions in improper Medicaid claims.

Paxton's office said the company supplied free nurses to help care for patients who received its drugs, as well as administrative support services that helped providers process insurance claims.

Texas Attorney General Ken Paxton on Tuesday sued U.S. drugmaker Eli Lilly for allegedly “bribing” providers to prescribe its medications.

Texas has sued pharmaceutical giant Eli Lilly for allegedly bribing and illegally inducing medical providers to prescribe its most profitable drugs, including the high-demand GLP-1 medications Mounjaro and Zepbound that are used for weight loss and diabetes treatment.

Eli Lilly hiked its 2025 guidance and posted second-quarter earnings that topped estimates on strong demand for its blockbuster weight loss and diabetes drugs.

Eli Lilly reported second quarter earnings Thursday, a day after competitor Novo Nordisk missed earnings estimates by Wall Street.

But Eli Lilly's supply woes began to ease earlier this year, and the Food and Drug Administration removed tirzepatide, the active ingredient in Mounjaro and Zepbound, from its shortage list.

Eli Lilly's new oral GLP-1 medication orforglipron produced an average weight loss of 12.4% (27.3 pounds) in clinical trials. The weight loss pill also significantly improved heart health markers like cholesterol and blood pressure.

Eli Lilly has signed a deal worth $1.3 billion with privately held Superluminal Medicines to discover and develop small-molecule drugs through AI to treat obesity and other cardiometabolic diseases.