HARTFORD, Conn. (AP) - Attorneys general from 51 states and territories on Wednesday filed a third lawsuit alleging a widespread price-fixing conspiracy by generic drug manufacturers, this time involving 80 topical medications.
The complaint, filed in the U.S. District Court for the District of Connecticut, names 26 corporate and 10 individual defendants who’ve been accused of trying to artificially inflate and manipulate drug prices while reducing competition for generic creams, gels, lotions, ointments, shampoos, and solutions sold throughout the U.S. It builds upon an investigation that began in 2013 into alleged violations of state and federal antitrust and consumer protection laws.
“This 500-page complaint details extensive, hard evidence of illegal collusion to fix prices and to divide market share on more than 80 drugs used in dermatology and the treatment of skin condition, pain and allergies,” said Connecticut Attorney General William Tong, noting the allegations are based on a review of millions of documents, including records of telephone calls, text messages and other communications involving more than 600 generic drug sales and pricing professionals across the country, as well as interviews with cooperating witnesses.
According to Tong’s office, three generic drug manufacturers, Taro Pharmaceuticals, Perrigo, and Fougera Pharmaceuticals, which is now Sandoz, a division of Novartis, sold nearly two-thirds of all generic topical products dispensed in the country from 2007 and 2014. Representatives from Tara, Sandoz and Perrigo said the companies disagreed with the allegations made by the states.
“We are aware of the recent filing and will respond when required. We maintain that the allegations made in this lawsuit are without merit, and we will continue to vigorously defend against them,” according to a statement from Taro.
Sandoz called the claims by the states “extremely broad” and noted “the individual instances of misconduct at the core of the resolution we reached with the U.S. Department of Justice in March do not support the vast, systemic conspiracy the states allege. We take seriously our compliance with antitrust laws, and we will continue to defend ourselves in this matter.”
Perrigo noted it was not a defendant in the previous two complaints filed by state attorneys general. A spokesperson said the company“intends to vigorously defend this case and looks forward to presenting a full defense, which will include all of the facts” and believes in “doing what is right and complying with laws.”
Tong contends the records reviewed by state investigators show competitors illegally shared information about prices and colluded to fix and raise prices and divide the market, efforts the complaint alleges has led to massive price spikes in certain medications.
“This is all to the detriment of our health care system and to consumers and our residents,” said Massachusetts Attorney General Maura Healey, during a conference call with Tong and North Carolina Attorney General Josh Stein. All three are Democrats.
Stein said the case is key considering prescription drugs on average make up 10% of an individual’s health care spending.
“Nationally, it’s $332 billion a year. That’s a number that’s been growing,” Stein said. “From 2007 to 2017, U.S. spending on prescription drugs has increased by 40 percent. And the majority of that increase is related to rising costs on existing drugs and not new drugs entering the market.”
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