A trio of antitrust complaints stretching back to 2016 have yielded a payoff, with generic drugmakers Heritage Pharmaceuticals and Apotex now on the hook to lay out a combined $49.1 million in settlement charges.
Heritage is ponying up $10 million while Apotex is set to pay $39.1 million over the companies’ alleged roles in a sweeping and long-running price-fixing scheme, according to a new release from Illinois Attorney General Kwame Raoul.
As part of the deal, Heritage and Apotex have also agreed to cooperate in ongoing multistate litigation against 30 generic drugmakers and 25 individual executives, plus internal reforms and expanded efforts to comply with U.S. antitrust laws.
“These settlements are a step in the right direction, toward holding drug companies accountable for outrageous profits at the expense of residents who rely on what are supposed to be more affordable generic drugs,” Raoul said in a statement.
The settlements and cooperation agreements offer Heritage and Apotex a resolution after years of antitrust investigation implicating a wide range of generic drugmakers.
The situation kicked off in 2016 when a coalition of nearly all U.S. states and territories filed an antitrust complaint naming Heritage and 17 corporate defendants, plus two individual defendants and 15 generic medicines. Two former Heritage executives, Jeffery Glazer and Jason Malek, have themselves entered settlement agreements and are now cooperating with the ongoing investigation, according to the release from Raoul’s office.
Since then, the coalition has filed another two complaints—the first naming Teva Pharmaceuticals and multiple other major drugmakers like Sandoz, Mylan, Amneal and Apotex—and the second homing in on 80 topical generic drugs that make up billions of dollars in sales in the U.S.
The latter case names 26 corporate defendants and 10 individual defendants, the release states.
The cases are propped up by a series of investigations built on evidence from cooperating witnesses “at the core of different conspiracies,” plus document and phone databases.
Overall, the complaints depict an “interconnected web” of executives from rival companies who met with each other during industry dinners, girls’ nights out, lunches, cocktail parties and golf games that helped “[sow] the seeds for their illegal agreements,” Raoul’s office explained.
Throughout the complaints—which also focus on frequent telephone calls, emails and text messages—defendants bandied about terms like “fair share,” “playing nice in the sandbox,” and “responsible competitor” as code for their schemes to discourage competition, raise prices and establish a “culture of collusion,” the settlement release claims.
The payouts from Heritage and Apotex follow a series of other price-fixing settlements inked this year.
Most recently, Glenmark Pharmaceuticals in early September agreed to pay the Justice Department $25 million to resolve allegations that it paid and received compensation to rig prices, supply and allocation of customers with other drugmakers around the cholesterol med pravastatin between 2013 and 2015.
Prior to that, Sandoz and its subsidiary Fougera Pharmaceuticals in February reached a $265 million settlement with direct purchasers linked to legacy antitrust allegations in Pennsylvania federal court. The claims in the case revolve around purported price fixing that took place between 2009 and 2019.
Meanwhile, at the start of the year, Apotex, Heritage and Breckenridge Pharmaceutical agreed to hand over $30 million, $10 million and $5 million, respectively, to resolve litigation from direct purchasers filed in 2017 that alleged Apotex and its peers conspired with other, non-settling drugmakers to artificially inflate and maintain prices for certain generic drugs.