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United States drugmakers allegedly collude on generic price hikes

14 May 2019

The attorneys general claim that the prices of more than 100 drugs were artificially inflated thanks to the practices of Teva, Novartis' Sandoz unit, Pfizer, Mylan and others between 2012 and 2015.

A complete list of the states filing the suits and the drug makers can be found here. In the peak timeframe noted in the lawsuit, Teva raised its prices on about 387 formulations of 112 generic drugs.

"Millions and millions of Americans rely on generic prescription drugs every day to treat diabetes, infections, depression, cancer, HIV, and more", Schmitt said.

A spokesman for Teva Pharmaceuticals, among the firms named in the lawsuit, stated Teva has not participated in any behavior that would cause criminal or civil liability.

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According to the complaint filed by 44 US states on Friday (May 10th) on the US District Court of ct, as many as 20 drugmakers had been involved in conspiracies to divide up the pharmaceutical market among themselves in order to avert competitions, while holding the keys to drop or raise drug prices on US markets. "When a second generic manufacturer enters, that reduces the average generic price to almost half the brand-name price", the suit says.

Once an investigation was initiated by the State of CT, in July 2014, the lawsuit alleges that such price increases "slowed dramatically". "This price fixing scheme by Teva Pharmaceuticals and other industry giants demonstrates a level of corporate greed the state of Missouri and the country rarely sees". The lawsuit seeks damages, civil penalties and actions to restore competition to the generic drug market.

"Apparently unsatisfied with the status quo of "fair share" and the mere avoidance of price erosion, Teva and its co-conspirators embarked on one of the most egregious and damaging price-fixing conspiracies in the history of the United States", states the complaint.

The suit contends that this resulted in "many billions of dollars of harm to the national economy over a period of several years".

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'When communications were reduced to writing or text messages, defendants often took overt and calculated steps to destroy evidence of those communications, ' the suit states. The complaint is an expanded document of suit, which is still under litigation and was filed by USA states in December 2016.

'The company delivers high-quality medicines to patients around the world and is committed to complying with all applicable laws and regulations in doing so'.

The evidence also reportedly shows how the different drug companies have agreed not to compete with each other to keep prices as high as possible.

The industry generally has denied any wrongdoing, although two former executives from Heritage Pharmaceuticals, one of the original defendants, have reached settlements with the coalition of states and are cooperating.

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United States drugmakers allegedly collude on generic price hikes