Mochi Health Lawsuit: Lilly’s Claims, Court Status, and Response

Eli Lilly’s lawsuit against Mochi Health, filed in April 2025 in the Northern District of California, accuses the San Francisco telehealth company of illegally marketing compounded copies of Lilly’s weight-loss drugs Mounjaro and Zepbound and of running an unlawful corporate medical practice through affiliated entities. A federal judge dismissed the first version of the complaint for lack of standing in October 2025, but in April 2026 the same judge let Lilly’s amended false-advertising and unfair-competition claims proceed. Discovery is under way, and a jury trial is scheduled to begin January 10, 2028. ¹

Who Mochi Health Is

Mochi Health is a telehealth platform founded in 2022 that connects patients with physicians and dietitians for weight management. The company says it serves more than 500,000 patients and charges a $79 monthly membership fee, plus $199 a month for compounded tirzepatide or $99 a month for compounded semaglutide. ² Its CEO is Dr. Myra Ahmad. ³

Lilly did not name Mochi alone. The suit also targets Mochi Medical CA, P.C. and Mochi Medical P.A., the affiliated medical groups that employ Mochi’s prescribing physicians, along with Aequita Pharmacy LLC and Aequita Corporation, which supplied the compounded tirzepatide. ⁴

What Lilly Is Accusing Mochi Of

Lilly’s complaint rests on two live theories after the April 2026 ruling: false advertising under the federal Lanham Act and violation of California’s Unfair Competition Law based on the unlawful corporate practice of medicine. A civil-conspiracy claim was dismissed, with leave to amend. ⁵

Misleading Marketing Claims

Lilly alleges Mochi described its compounded tirzepatide as a “generic” of Lilly’s FDA-approved products, marketed mass-produced compounds as “personalized” treatments, and claimed they were “safe and effective” by pointing to clinical studies actually conducted on Lilly’s branded drugs. Lilly also alleges Mochi held out its CEO as a licensed physician and falsely told customers that its partner pharmacy, Aequita, had voluntarily stopped compounding tirzepatide. ⁴ Judge Corley found in April 2026 that these were specific enough statements about safety, FDA-approval status, and personalization to support a Lanham Act claim. ⁶

Corporate Practice of Medicine

California law bars unlicensed corporations from controlling clinical decisions that belong to licensed physicians. Lilly alleges Mochi Health operates through a management-services-organization structure in which the corporate entity hires physicians, dictates diagnostic protocols, and changes compounded medication doses and formulations for business reasons rather than medical need. ⁷

The complaint describes an interwoven set of entities: Mochi Medical shares its CEO with Mochi Health, Mochi Medical’s director is reportedly the CEO’s father, and a pharmacy tied to Mochi’s supply chain was allegedly owned indirectly by the CEO’s husband. ⁸ One specific accusation: Lilly says Mochi directed that additives like niacinamide and pyridoxine be included in compounded tirzepatide so the product would look different from Lilly’s drugs, giving Mochi a business rationale to keep compounding. ⁴

Why the Lawsuit Came When It Did

Federal law lets pharmacies compound copies of FDA-approved drugs during official shortages, and it was that shortage exception that allowed the compounded GLP-1 market to grow in the first place. The FDA declared the tirzepatide shortage resolved on December 19, 2024. ⁹ Pharmacies had until February 18, 2025, and outsourcing facilities until March 19, 2025, to stop producing compounded versions. ¹⁰ Lilly filed suit against Mochi on April 23, 2025, roughly a month after the outsourcing-facility deadline passed.

How the Case Has Moved Through Court

First Complaint Dismissed for Lack of Standing

Lilly’s original complaint asserted four claims under the California Unfair Competition Law, the California False Advertising Law, the Lanham Act, and civil conspiracy. ⁴ On October 24, 2025, U.S. District Judge Jacqueline Scott Corley dismissed the entire case for lack of Article III standing.

Judge Corley found Lilly’s theory of harm too speculative. Lilly had argued that patients who had bad experiences with Mochi’s compounded tirzepatide would blame Lilly’s branded products. But Lilly identified no specific instance of a patient failing to lose weight on Mochi’s product, and the court noted that compounding is “a federally recognized and regulated pharmaceutical practice.” The one piece of consumer evidence Lilly offered, a Better Business Bureau complaint about a rash tied to added niacinamide, did not help because the customer already knew the compounded product contained additives absent from Lilly’s drugs. ⁴ The dismissal was without prejudice, and Lilly had until November 14, 2025, to amend.

Amended Complaint Survives

Lilly’s First Amended Complaint dropped the False Advertising Law claim and kept three: the Unfair Competition Law, the Lanham Act, and civil conspiracy. After oral argument on April 9, 2026, Judge Corley issued a mixed ruling on April 20, 2026. ⁶

This time Lilly alleged both economic injury, in the form of diverted customers and lost sales, and reputational injury, backed by studies indicating higher adverse-event rates among users of compounded GLP-1 drugs and evidence of consumer confusion between FDA-approved and compounded products. Judge Corley ruled the allegations were plausible at the pleading stage and that questions about how much harm Lilly actually suffered belonged to the merits. ⁵

The Unfair Competition Law claim survived because Lilly plausibly alleged that Mochi’s control over its affiliated medical entities and their prescribing practices crossed from administrative management into the corporate practice of medicine. The court rejected Mochi’s argument that the matter should be left to California’s Medical Board. The Lanham Act claim survived on the strength of specific alleged misstatements about safety, FDA-approval status, and personalization. The civil-conspiracy claim was dismissed for failing to plead facts supporting “a plausible inference of an agreement to a common plan,” though Lilly again received leave to amend. ⁶

Mochi’s Response

Mochi Health has maintained that it operates lawfully. After the April 2026 ruling, a company spokesperson said: “We remain confident in our position and look forward to demonstrating through the discovery process that Mochi operates lawfully and in the best interest of patients.” ⁵ On the added niacinamide and pyridoxine, the company has said those additives are “not clinically significant” and that formulation choices depend on which pharmacy fills the prescription. ⁴ Mochi’s defense is being led by Joseph LaMagna, Andrea Frey, and Benjamin Lin of Hooper Lundy & Bookman. ¹¹

What Happened at Aequita Pharmacy

The supply-chain allegations in Lilly’s complaint gained weight from separate state findings about Aequita Pharmacy, the Kirkland, Washington, facility that at its peak shipped 20,000 prescriptions a week for Mochi patients. In March 2025, the Washington Department of Health issued a “Notice of Immediate Jeopardy” after an inspection. According to the findings, the pharmacy used unlicensed temporary workers recruited from home-improvement-store parking lots and allowed untrained assistants to compound in clean rooms without supervision. Inspectors reported expired GLP-1 prescriptions, glass particles in some compounded products, and frozen popsicles used as cooling for shipping that leaked onto medication. ¹²

Whistleblowers told investigators that CEO Myra Ahmad was “directly involved” in Aequita’s operations and had made “risky cost-cutting decisions,” including instructing employees to find unlicensed workers to handle sterile compounded drugs. Investigators also identified USA Distribution LLC, a wholesaler company formed by Ahmad and linked to an Aequita warehouse, where state inspectors found peptide base powders despite the company lacking a wholesaler license. Aequita Pharmacy closed in April 2026. ¹²

What Happens Next

Lilly filed a Second Amended Complaint, and on June 5, 2026, the defendants moved to partially dismiss its third cause of action. A hearing on that motion is set for August 27, 2026. Discovery is under way, and on May 29, 2026, Judge Corley signed stipulated orders governing electronically stored information and the protection of confidential materials. The court has scheduled a pretrial conference for December 16, 2027, with jury selection and a seven-day trial beginning January 10, 2028. ¹

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