Court rules in Lilly v. Empower Clinic Services on compounded tirzepatide

A federal judge in Houston has issued a split ruling in Eli Lilly's lawsuit against Empower Pharmacy, one of the country's largest compounding pharmacies, over its sale of compounded tirzepatide — the active ingredient in Lilly's Mounjaro and Zepbound ^[1].

Senior U.S. District Judge Sim Lake granted part of Empower's motion to dismiss and denied part of it on April 29, 2026, in the U.S. District Court for the Southern District of Texas, Civil Action No. H-25-3464 ^[1]. The result: Lilly's federal Lanham Act false-advertising claim is out, its Texas common law unfair competition claim is out, and its consumer protection claims under the laws of eight states remain alive ^[1].

What Lilly alleged

Lilly sued Empower Clinic Services, LLC, doing business as Empower Pharmacy, alleging the pharmacy was illegally manufacturing and selling unapproved versions of tirzepatide ^[1]. According to the summary of the case, Lilly accused Empower of marketing its compounded tirzepatide as safe, effective and "personalized" when the products had never been clinically tested and were produced in standardized doses at massive scale — reportedly 70,000 doses per week ^[1].

Lilly brought three categories of claims: a federal false-advertising claim under the Lanham Act, 15 U.S.C. § 1125(a)(1)(B); statutory unfair competition and deceptive trade practices claims under the laws of nine states; and a Texas common law unfair competition claim ^[1].

What the judge decided

On the federal claim, the court applied the Supreme Court's two-part test from Lexmark International v. Static Control Components ^[1]. The judge found Lilly cleared the first hurdle — its claimed lost sales and reputational harm fell within the Lanham Act's protective scope — but failed the second, proximate causation ^[1]. Lilly alleged that "some sales" of Empower's products "would have been made by Lilly," which the court said fell far short of the near one-to-one causal link Lexmark requires ^[1]. The court also called Lilly's theory that consumers might blame Lilly for adverse events tied to Empower's products too speculative ^[1].

That mirrors a parallel case, Eli Lilly v. Willow Health Services, in the Central District of California, which dismissed Lilly's Lanham Act claim on the same grounds on Feb. 3, 2026 ^[1].

Empower also argued that the state-law claims were preempted by federal law under the Supreme Court's Buckman doctrine, which bars state claims that exist only because of federal regulatory requirements ^[1]. The court disagreed, finding Lilly's claims rested on independent state-law duties — state prohibitions on selling unapproved new drugs — rather than enforcement of Section 503A of the Federal Food, Drug, and Cosmetic Act ^[1]. It followed the Fifth Circuit's 2025 decision in Zyla Life Sciences v. Wells Pharma ^[1]. Claims under the laws of Alaska, Colorado, Connecticut, Hawaii, North Carolina, South Carolina, Tennessee and Washington survived ^[1].

The Texas common law claim was dismissed because, the court held, Texas courts do not recognize a private tort action based on violations of the Texas Food, Drug, and Cosmetic Act — following the same court's earlier ruling in Eli Lilly v. Revive RX ^[1].

Why it matters for patients

This is a procedural ruling about which legal theories Lilly can pursue, not a decision on whether Empower's compounded tirzepatide is safe, effective or lawful. The court did not make findings about product quality, and nothing in the source describes any change to what Empower can sell right now ^[1].

Still, the case is one strand in a larger fight over compounded GLP-1 drugs. Brand manufacturers Eli Lilly and Novo Nordisk have been pursuing legal strategies to curb compounders' sale of tirzepatide and semaglutide products ^[1]. This ruling signals that their preferred federal theory — Lanham Act false advertising — may not survive the pleading stage, because courts are demanding a specific, non-speculative link between a compounder's marketing and the manufacturer's lost sales ^[1].

At the same time, the survival of eight state consumer protection claims means the litigation continues, and state-law theories may become the main vehicle for these disputes ^[1]. The court also rejected Empower's argument that compounding pharmacy regulations create a blanket exemption from state consumer protection laws, saying courts will look at the specific nature of the operation — here, mass-scale production — rather than granting categorical immunity ^[1].

What happens next

The surviving state claims now move past the motion-to-dismiss stage ^[1]. The source does not give a trial date, a schedule for further proceedings, or say whether Lilly will appeal or seek to amend its federal claim — those details are not yet known from this ruling.

The full opinion is available through GovInfo under docket 4:25-cv-03464 ^[1].