Multi-State Lawsuit Accuses Drug Companies of Price Fixing

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Authorities in 44 states are accusing 20 generic drug companies of conspiring to hike prices on more than 100 different drugs in a federal lawsuit, calling the alleged scheme “one of the most egregious and damaging price-fixing conspiracies in the history of the United States.”

The drugs included everything from tablets and capsules to creams and ointments to treat conditions including diabetes, high cholesterol, high blood pressure, cancer, epilepsy and more, they said. In some instances, the coordinated price increases were more than 1,000 percent, the lawsuit said.

The lawsuit also names 15 individuals as defendants who it said carried out the schemes on a day-to-day basis.

“The level of corporate greed alleged in this multistate lawsuit is heartless and unconscionable,” Nevada Governor Steve Sisolak said in a statement.

According to New Jersey Attorney General Gurbir Grewal, more than half of the corporate defendants are based in New Jersey, and five of the individual defendants live in the state.

The lawsuit seeks damages, civil penalties and actions by the court to restore competition to the generic drug market.

Generic drugs can save drug buyers and taxpayers tens of billions of dollars a year because they are a lower-priced alternative to brand-name drugs.

“Generic drugs were one of the few ‘bargains’ in the United States healthcare system,” the lawsuit said.

“Prices for hundreds of generic drugs have risen – while some have skyrocketed, without explanation, sparking outrage from politicians, payers and consumers across the country whose costs have doubled, tripled, or even increased 1,000% or more,” it said.

As a result of the drug companies’ conspiracies, it said, consumers and states paid “substantially inflated and anticompetitive prices for numerous generic pharmaceutical drugs” while the drug companies profited.

The state attorneys general claim those hikes were coordinated by high-level company executives using thinly veiled code phrases like “playing nice in the sandbox” to refer to anti-competitive practices.

The costs affected more than the people who needed the drugs, the lawsuit notes. They also put financial pressures on taxpayer-funded health programs and private insurance plans.

The suit claims much of the collusion was plotted out at industry outings, including a 2014 meeting of more than a dozen high-level executives at a steakhouse in Bridgewater. Executives are also accused of taking “overt and calculated steps to destroy evidence,” including text messages and other written communications.


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