New Jersey Attorney General Gurbir S. Grewal Files Antitrust Lawsuit Against Twenty Generic Drug Companies

New Jersey and a coalition of 43 other States have filed an antitrust lawsuit on May 12, 2019 accusing 20 generic drug companies of conspiring to artificially inflate the prices of over one hundred generic drugs, in violation of federal and state antitrust and consumer protection laws.

New Jersey Attorney General Gurbir S. Grewal - Photo Courtesy - State of New JerseyNew Jersey Attorney General Gurbir S. Grewal

Besides the 20 generic drug companies, the complaint named 16 individuals including an Indian origin woman Nisha Patel (Collegeville, PA) of Teva Pharmaceuticals as defendants.

The 16 individual defendants are drug company executives responsible for sales, marketing, pricing and operations and “involved in one of the most egregious and damaging price-fixing conspiracies in the history of the United States”.

List of NJ Drug Companies Involved in Price Fixing

Of the 20 generic drug companies sued, eleven corporate pharmaceutical defendants are based in Princeton, Parsippany, Bridgewater, Mahwah, Dayton, Fairfield, North Peapack and North Pennigton, New Jersey.

* Actavis Holdco US, Inc., Parsippany, NJ
* Actavis Pharma, Inc., Parsippany, NJ
* Amneal Pharmaceuticals, Inc., Bridgewater, NJ
* Aurobindo Pharma U.S.A., Inc., Dayton, NJ
* Breckenridge Pharmaceutical, Inc., Fairfield, NJ
* Dr. Reddy’s Laboratories, Inc., Princeton, NJ
* Glenmark Pharmaceuticals Inc. USA, Mahwah, NJ
* Greenstone LLC, North Peapack, NJ
* Sandoz, Inc., Princeton, NJ
* Wockhardt USA, LLC, Parsippany, NJ
* Zydus Pharmaceuticals (USA), Inc., North Pennington, NJ

According to the complaint:

…the collusive activity peaked between July 2013 and January 2015, when one of the participants in the alleged conspiracy, Teva Pharmaceuticals USA, Inc., is alleged to have significantly raised prices on about 387 formulations of 112 different generic drugs. The size of the alleged price increases varies, but a number of drugs saw their prices soar by “well over 1,000 percent.”

…A cornerstone of the conspiracy was an understanding among the defendant companies that they would cooperate on pricing so each company could maintain a “fair share” of the various generic drug markets. At the same time, the companies also colluded to “significantly raise prices on as many drugs as possible.”

…Knowing their actions were illegal, corporate conspirators generally chose to talk in person or by cell phone, so as not to create a written record of their conduct.

…During their conversations, the defendant executives frequently used coded terms like “playing nice in the sandbox” and “responsible competitor” to describe their anti-competitive efforts and to reference the industry’s engrained culture of collusion.

…The industry’s many posh trade shows, cocktail parties, dinners, conferences, golf outings and other events provided opportunities for such face-to-face discussions. And when communications were reduced to writing or text messages, the defendants often “took overt and calculated steps to destroy evidence” of them.

…Much of the anti-competitive conduct allegedly occurred in New Jersey, where many of the defendants are based. For example, a January 2014 “industry dinner” at a steakhouse in Bridgewater, NJ, which was attended by at least thirteen high-ranking executives from over five companies.

Drugs Involved in Price-Fixing Conspiracy

Drugs subjected to the unlawful pricing manipulations came from all classes of medication including oral antibiotics, blood thinners, cancer drugs, contraceptives, anti-inflammatory drugs, statins, anti-depressants, medications used to treat HIV, blood pressure medications, and many more.

Some of the drugs involved in price-fixing conspiracy are Fenofibrate (lowers bad cholesterol), Clonidine-TTS Patch & Irbesartan (treats high blood pressure), Tolterodine ER (for overactive bladder), Capecitabine and Temozolomide (cancer drugs), Combivir (HIV & AIDS drug), Dexmeth ER (for ADHD) etc.

Filed in U.S. District Court in Connecticut, the lawsuit seeks damages, civil penalties and actions by the court to restore competition to the generic drug market.

Antitrust Court Documents
Generic Drug Price-Fixing Conspiracy Complaint

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