A number of U.S. states have accused generic pharma companies of broad-based price-fixing, and have called for an existing lawsuit to be widened to include more pharmaceutical companies and drugs. The news sent the share price of many large generic pharma companies tumbling.
The original lawsuit, filed in December 2016, targeted 18 companies and named two individuals; Rajiv Malik, executive director of Mylan NV and Satish Mehta, CEO and managing director of one of India’s largest generic pharma companies, Emcure Pharmaceuticals.
The lawsuit alleges that the named companies divided customers up amongst themselves, agreeing that each company would have a certain percentage of the market. It also alleges that the two named executives in the suit agreed to carve up the market between them for a new delayed-release variant of the antibiotic, doxycycline hyclate.
The original suit targeted six generic pharma companies; Aurobindo Pharma USA Inc, Citron Pharma LLC, Heritage, Mayne Pharma USA Inc, Mylan and Teva Pharmaceuticals USA Inc. But the plaintiffs are pushing to add a further 10 companies to the litigation.
Speaking at a news conference in Hartford, Connecticut Attorney General George Jepsen, who is leading the case said: “It is our belief that price-fixing is systematic, it is pervasive, and that a culture of collusion exists in the industry.” Jepsen went on to say that, in the future, it is likely claims would be brought against more companies and possibly executives.
The original litigation focused on two drugs, doxycycline and glyburide, after it was revealed that the price of doxycycline had risen from $20 for 500 tablets in October 2013 to $1849 in May 2014. The expanded suit wants to increase the number of drugs to include; glipizide-metformin, glyburide-metformin, acetazolamide, doxycycline monohydrate, fosinopril, meprobamate, nimodipine.
Endo International PLC, one of the companies named in the expanded suit, refuted the allegation. Company spokesperson Heather Lubeski said Endo would firmly defend itself against any claims. The generic pharma antitrust law firm representing Endo declined to comment.
Endo is also coming under pressure from investors following the suit. Private investor Alexandre Pelletier alleges that Endo hid the scale of its price-fixing probe from investors and has filed suit alleging violations of federal securities law.