Incyte settles CMS lawsuit over Opzelura Medicaid rebate rules

Incyte Corporation (NASDAQ: INCY) has reached a settlement with the Centers for Medicare & Medicaid Services (CMS) over a dispute regarding Medicaid rebate rules applied to its drug Opzelura (ruxolitinib) cream, according to a company statement.

Under the agreement, CMS will not classify Opzelura as a line extension of Incyte's existing drug Jakafi (ruxolitinib) for the purposes of Medicaid rebate regulations. In exchange, Incyte has withdrawn its lawsuit challenging those regulations.

Incyte said the settlement was reached based on the unique circumstances surrounding the two drugs.

The company expects to record a one-time, non-cash benefit of approximately $246 million in the second quarter ending June 30, 2026, reflecting the reversal of previously established accrual balances through March 31, 2026. Those accruals had been set aside to cover potential liabilities tied to the possible application of line extension rules to Opzelura.

Going forward, Incyte said it will no longer accrue for the potential application of those regulations to Opzelura and expects an improvement to the drug's gross-to-net calculations. The company plans to update its financial guidance when it releases its next scheduled earnings report.

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