44 states sue 20 drug companies, allege drug price inflation of more than 1,000%

A coalition of states allege a string of drug companies arranged a scheme that would raise generic drug prices in some instances by more than 1,000% and reduce competition for generic drugs, according to a recent press release from the New Jersey Attorney General’s Office.

The drugs involved include antidepressants, anti-inflammatory drugs, contraceptives, drugs to treat cancer, high BP, HIV, oral antibiotics and many more, the release also stated.

“The generic drug market is structured in a way that allows generic drug manufacturers, including but not limited to the Defendants, to interact and communicate with each other directly and in person, on a frequent basis,” the complaint stated in a section titled “The Cozy Nature Of The Industry And Opportunities For Collusion.”

“Generic drugs were one of the few ‘bargains’ in the United States health care system. ... At some point, that price dynamic changed for many generic drugs. Prices for hundreds of generic drugs have risen — while some have skyrocketed, without explanation, sparking outrage from politicians, payers and consumers across the country whose costs have doubled, tripled, or even increased 1,000% or more,” the complaint continued.

According to press release, the alleged price-fixing by the defendants has caused “significant financial damage” to state health plans, taxpayer-funded federal health care programs like Medicare and Medicaid, employer-sponsored health plans, and individual consumers who pay out-of-pocket for their generic medications.

The lawsuit, filed late last week at the U.S. District Court in Connecticut, seeks damages, civil penalties and actions by the court that would restore competition to the generic drug market. More than half the 20 corporate defendants have offices in, and 5 of the 16 individuals named in the lawsuit, have residences in, New Jersey.

A coalition of states allege a string of drug companies arranged a scheme that would raise drug prices in some instances by more than 1,000% and reduce competition for generic drugs, according to a recent press release from the New Jersey Attorney General’s Office.

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“We all know that prescription drugs can be expensive. Now we know that high drug prices have been driven in part by an illegal conspiracy among generic drug companies to inflate their prices,” Gurbir S. Grewal, New Jersey Attorney General, said in the release.

The corporate defendants in the lawsuit are: Teva Pharmaceuticals USA; Sandoz; Mylan Pharmaceuticals; Actavis Holdco US; Actavis Pharma; Amneal Pharmaceuticals; Apotex; Aurobindo Pharma U.S.A.; Breckenridge Pharmaceutical; Dr. Reddy’s Laboratories; Glenmark Pharmaceuticals; Greenstone; Lupin Pharmaceuticals; Par Pharmaceutical Companies; Pfizer; Taro Pharmaceuticals USA; Upsher-Smith Laboratories; Wockhardt USA; and Zydus Pharmaceuticals (USA). Healio Primary Care Today was unable to reach the companies for comment prior to this story’s posting.

Arkansas, California, Georgia, New Hampshire, South Dakota and Wyoming are the states that are not a complaint in the lawsuit. – by Janel Miller

References:

“AG Grewal Files Antitrust Lawsuit Against Twenty Generic Drug Companies, Alleging Conspiracy to Raise Prices on Over 100 Drugs.” https://www.nj.gov/oag/newsreleases19/pr20190512a.html. Accessed May 13, 2019.

“In the United States District Court for the District of Connecticut.” https://www.nj.gov/oag/newsreleases19/Complaint.pdf Accessed May 13, 2019.

Disclosures: Healio Primary Care Today was unable to determine relevant financial disclosures prior to publication.