MORGANTOWN —
State Attorney General Patrick Morrisey has joined with 50 other AGs to bring another collusion lawsuit against a number of generic drug manufacturers, including Mylan, Morrisey announced Wednesday.
As in previous suits, the nearly 600-page complaint alleges that 27 companies and nine individuals employed by those companies colluded to allot market “fair share” and set prices in order to avoid competition that could affect sales and drive down prices.
“Those who manipulate prices and reduce competition increase the financial burden on families across West Virginia,” Morrisey said in a release announcing the suit. “Generic drugs are a key aspect of affordable healthcare, and alleged actions such as these selfishly undermine the efforts of so many to keep prices affordable for those in desperate need of prescription drugs. Bad actors must be held accountable.”
Connecticut is the lead state in the suit, which was filed in the U.S. District Court for the District of Connecticut. Mylan Inc. and its Morgantown subsidiary are named as defendants, along Sandoz, Actavis, Bausch Health, Perrigo, Pfizer, Taro and others.
The suit deals with about 80 topical drugs, which include creams, lotions, gels, ointments, and solutions. Among them are Lidex and Aristocort, for eczema and allergies; Differin, for acne; nystatin, for fungal infections; lidocaine ointment, for pain; and hydrocortisone acetate suppositories hemorrhoids and other conditions.
“Going back many years – from at least 2009 through early 2016 – collusion has been rampant among manufacturers of generic topical products,” the complaint says. “Many topical products have only two or three competitors. As a result, the sales and pricing executives at these companies know each other well and have used those business and personal relationships as a means to collude to limit competition, allocate customers, and significantly raise prices on dozens of generic topical products.”
Company executives meet regularly at trade shows and customer conferences and communicate frequently by phone and text, the suit alleges.
The suit alleges, “Although manufacturers of generic topical products have been colluding on price increases since at least 2009, the size and frequency of those increases grew exponentially in 2013 and 2014. During that time period, the prices of hundreds of generic drugs skyrocketed without explanation.”
Morrisey noted that the suit is built on evidence from six cooperating witnesses, more than 20 million documents and millions of phone records, including call data and contact information for more than 600 sales and pricing individuals in the generics industry. It includes a two-volume notebook containing the notes of one cooperating witness taken over the course of several years.
The suit seeks damages, civil penalties, restitution, costs and court action to restore competition to the generic drug market.
Two other collusion related suits are in the U.S. District Court for the Eastern District of Pennsylvania. West Virginia is also a plaintiff in those. Mylan is named in both; Mylan President Rajiv Malik is a named defendant in one of them.
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