California court resurrects price-fixing case

Thanks to the California Supreme Court, Big Pharma has to fight a price-fixing suit dismissed by a lower court two years ago. The suit claims that the drugmakers--Pfizer, GlaxoSmithKline, AstraZeneca, Merck and the rest of pharma's heavyweights--not only set artificially high prices, but conspired to keep cheaper Canadian drugs off the U.S. market and to stave off generic competitors, too.

The plaintiffs in the case are pharmacies. As intermediaries between Big Pharma and consumers, they found themselves vulnerable to the so-called "pass-on" defense, which says that the companies can't be held liable for illegal pricing because the pharmacies passed the overcharge on to consumers. The pharmacies themselves didn't suffer any damages, so they had no legal standing.

Or so the argument went. And it persuaded the trial court and a California appeals court to dismiss the suit. But the California Supremes disagreed; the court ruled that just because "a purchaser passes on an overcharge does not mean it lacks for injury or damages," as quoted by Pharmalot. The case now goes back to trial court in Oakland.

- check out the news from Bloomberg
- see the Pharmalot post

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