AG Beshear joins lawsuit alleging massive conspiracy among generic pharmaceutical companies

12/15/2016 01:05 PM

Attorney General Andy Beshear representing Kentucky has joined 19 other states in suing national generic pharmaceutical companies, alleging a massive conspiracy to monopolize generic drugs.

The lawsuit filed in federal court Thursday, alleges major drug companies sought to reduce competition and increase the price of generic drugs.

Kentucky joins the action, claiming the rigging violates both state and federal antitrust laws. States involved in the suit are seeking a permanent injunction to halt the companies from continuing their conduct. The lawsuit calls on the companies to correct the effects of their conduct, and repay “ill-gotten gains,” as well as pay civil penalties to states.

The lawsuit files claims against generic drug-maker Heritage Pharmaceuticals Inc.; Auribindo Pharma USA Inc.; Citron Pharma LLC; Mayne Pharma (USA) Inc.; Mylan Pharmaceuticals Inc.; and Teva Pharmaceuticals USA Inc, according to a press release.

The suit alleges the named companies entered into multiple illegal conspiracies in order to restrain trade, inflate and manipulate prices and reduce competition in the United States for several generic drugs, including doxycycline hyclate delayed release, an antibiotic, and glyburide, an oral diabetes medication.

“The alleged actions by these companies constitute a massive conspiracy that has caused significant, harmful and continuing effects not just in the country’s health care system but right here in Kentucky,” Beshear said in a statement.

“At a time when access to affordable health care and low-cost medicine for our seniors and families could not be more critical, these companies have allegedly conspired to rip them off, charging far higher prices than Kentucky families should have to pay.”

Generic drug sales in the United States were estimated at nearly $75 billion; currently, the generic pharmaceutical industry accounts for approximately 88 percent of all prescriptions written in the United States, according to a press release.

The suit comes after the state of Connecticut initiated an investigation of the reasons behind suspicious price increases of certain generic pharmaceuticals in 2014. That investigation uncovered evidence of a broad, coordinated and long-running series of conspiracies to fix prices and allocate markets for a number of generic pharmaceuticals.

Thursday’s lawsuit from the 20 states alleges misconduct was thought up and carried out by senior drug company executives and their subordinate marketing and sales executives.

Nick Storm

Nick Storm is the Anchor and Managing Editor of Pure Politics available exclusively on Spectrum News. Pure Politics is the only nightly program dedicated to Kentucky politics. Nick covers all of the political heavyweights and his investigative work brings to light issues that might otherwise go unnoticed, like his coverage of the backlog of DNA rape kits waiting to be tested in Kentucky. Nick is also working on a feature length bio documentary Outlaw Poet: A documentary on Ron Whitehead. Pure Politics airs weeknight at 7 and 11:30 on Spectrum News or anytime with Spectrum On Demand.Follow Nick on Twitter @NStorm_Politics. Nick can be reached at 502-792-1107 or nicholas.storm@charter.com.

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