In Major Antitrust Lawsuit, AG Healey Sues Generic Drug Makers for Conspiring to Raise Prices
Six Pharmaceutical Companies Coordinated to Fix Drug Pricing Among Competitors and Maintain Market Share
BOSTON – Alleging that six pharmaceutical companies conspired together to raise prices and reduce competition for generic drugs, Attorney General Maura Healey has joined a coalition of states in filing a lawsuit against the generic drug makers.
The complaint , filed today in U.S. District Court for the District of Connecticut, alleges that generic drug-makers Heritage Pharmaceuticals, Inc., Aurobindo Pharma USA, Inc., Citron Pharma, LLC, Mayne Pharma (USA), Inc., Mylan Pharmaceuticals, Inc. and Teva Pharmaceuticals USA, Inc. conspired to maintain market share, avoid competition and fix prices in order to manipulate and raise the prices of two generic drugs: doxycycline hyclate delayed release, an antibiotic, and glyburide, an oral diabetes medication.
The complaint alleges that the companies routinely coordinated their schemes with their competitors at industry trade shows, customer conferences and other events, as well as through direct email, phone and text message communications.
“These drug makers coordinated to allegedly fix prices and allocate markets for these two generic pharmaceuticals in order to maximize profits,” AG Healey said. “Generic drugs play a vital role in keeping health care costs down and making medication affordable to those who need it, and companies that fix prices to illegally profit and drive up prescription drug costs must be held accountable.”
In 2015, generic drug sales in the United States were estimated at $74.5 billion, and the generic pharmaceutical industry accounts for approximately 88 percent of all prescriptions written in the United States.
In July 2014, the state of Connecticut initiated an investigation into the reasons behind suspicious price increases of certain generic pharmaceuticals. In the lawsuit filed today, the states allege that the misconduct was conceived and carried out by senior drug company executives and their subordinate marketing and sales executives. The states allege that this anticompetitive conduct, which includes efforts to fix and maintain prices, allocate markets and otherwise thwart competition, caused significant, harmful and continuing effects to the country’s healthcare system.
The drug companies allegedly made efforts to avoid communicating with each other in writing or, in some instances, deleted written communications, including after they became aware of the investigation. The states allege that the companies’ conduct violated the federal Sherman Act and are asking the court to enjoin 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.
In addition to Massachusetts, and led by Connecticut’s attorney general, the plaintiff states in this lawsuit are Delaware, Florida, Hawaii, Idaho, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Minnesota, Nevada, New York, North Dakota, Ohio, Pennsylvania, Virginia and Washington.
The lawsuit was filed under seal in the U.S. District Court for the District of Connecticut. Portions of the complaint are redacted in order to avoid compromising the states’ ongoing investigation.
This matter is being handled for Massachusetts by Antitrust Division Assistant Attorneys General Michael MacKenzie, Carol Head, Matthew Lyons, Economic Analyst / Paralegal Kyle Barr and Chief William Matlack.