44 States Join Lawsuit Alleging Price Fixing for Generics

May 13, 2019
Valerie DeBenedette

Volume 163, Issue 6

Suit filed in Connecticut alleges companies conspired to inflate prices on more than 100 generic drugs.

State prosecutors from forty-four states have joined a lawsuit filed in Connecticut that claims several of the largest makers of generic drugs conspired to inflate or manipulate prices on more than 100 products. 

Puerto Rico is also a party to the lawsuit. 

“We have hard evidence that shows the generic drug industry perpetrated a multibillion-dollar fraud on the American people,” Connecticut Attorney General William Tong. The suit says that prices for generic drugs were inflated by more than 1,000% in some cases. 

The companies named in the suit include Teva, Pfizer, Novartis, and Mylan. In addition to the companies, the suit also names 15 company executives in sales and marketing departments and who were involved in pricing. 

The suit alleges that these generic drug makers had an agreement not to compete with each other and to avoid competition that would push drug prices down. Company executives were said to meet and conspire on drug prices at industry events, parties, and golf outings to reduce the amount of written communications.

The lawsuit was featured in a segment on CBS’s 60 Minutes, which said it might be “the biggest price-fixing scheme in U.S. history.” The Association for Accessible Medications (AAM), the trade group for generic drug makers, issued a statement in response: “We have established procedures and policies to help ensure compliance with the antitrust rules at our board meetings and all other AAM meetings. We will continue to assess our antitrust policies because we are committed to the idea that robust competition is the key to providing affordable and accessible medicines to patients while also constraining health care costs.” 

Teva denies the allegations. “Teva continues to review the issue internally and has not engaged in any conduct that would lead to civil or criminal liability,” the company says in a statement.

Connecticut has been investigating the prices of drugs for several years. This is the second lawsuit that the state has brought over drug prices; a similar suit was brought in 2016. “Between 2013 and 2014, a bottle of doxycycline shot up 8,281% from $20 to more than $1800. A bottle of asthma medication, albuterol sulfate, jumped more than 4000%, from $11 to $434. Pravastatin, a cholesterol drug, up more than 500%, from $27 a bottle to $196,” Tong told 60 Minutes

The drugs noted in the suit include lamivudine-zidovudine, budesonide, fenofibrate, amphetamine-dextroamphetamine, oral antibiotics, anticoagulants, oncology drugs, contraceptives. and antidepressants.

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