Va. joins 18 other states in federal lawsuit alleging conspiracy in generic drug costs

Attorney General Mark R. Herring on Dec. 16 joined with 18 other state attorneys general in filing a federal lawsuit against six generic drug-makers. The suit alleges that the firms conspired to artificially inflate and manipulate prices and to reduce competition in the market for two drugs in the United States: doxycycline hyclate delayed release, an antibiotic, and glyburide, an oral diabetes medication.

The drug-makers named in the lawsuit are Heritage Pharmaceuticals, Inc., Aurobindo Pharma USA, Inc., Citron Pharma, LLC, Mayne Pharma (USA), Inc., Mylan Pharmaceuticals, Inc. and Teva Pharmaceuticals USA, Inc.

Stated Herring, according to a news release, “Millions of Virginians, especially seniors, rely on generic medications as a more affordable option, and this investigation points to a wide-ranging scheme to artificially inflate the prices of these drugs. Although this investigation remains ongoing, this complaint is a big step in getting to the bottom of this situation and hopefully bringing down the cost of these generics for those who rely on them.”
 
According to the news release from Herring’s office, the lawsuit was filed under seal in the U.S. District Court for the District of Connecticut. Portions of the complaint were redacted “to avoid compromising the states’ ongoing investigation,” according to the release.

The complaint further alleges that the defendants routinely coordinated their schemes through direct interaction with their competitors at industry trade shows, customer conferences and other events, as well as through direct email, phone and text message communications. The anticompetitive conduct - including efforts to fix and maintain prices, allocate markets, and otherwise thwart competition - caused significant, harmful and continuing effects in the country’s healthcare system, the states allege. The suit also alleges that the companies and executives took steps to conceal their conduct, especially after learning of the investigation.

The states allege that the companies’ conduct violated the federal Sherman Act and are asking the court to bar the companies from engaging in illegal, anticompetitive behavior and for equitable relief, including substantial financial relief, to address the violations of law and restore competition.

Besides Virginia, plaintiffs are Connecticut, Delaware, Florida, Hawaii, Idaho, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Minnesota, Nevada, New York, North Dakota, Ohio, Pennsylvania, and Washington.

This matter is being handled by the Antitrust Unit of Attorney General Herring’s Consumer Protection Section.