After years of facing allegations of price-fixing on a massive scale, Teva Pharmaceuticals has agreed to settle with the state of Mississippi for $925,000. That "modest" sum could be just the tip of the iceberg.
The case dates back to 2019 when Mississippi, along with 43 other states, sued 20 generic drugmakers for divvying up markets and setting prices, the lawsuit alleged at the time. Investigations identified over 100 affected drugs for various maladies, including treatments for multiple sclerosis, HIV, ADHD and cancer, they claimed.
In some cases, price hikes that stemmed from backroom conversations were above 1,000%, former Connecticut Attorney General William Tong, who has led the investigation, said at the time.
The suit said Teva played a key role in the industrywide scheme and named a number of Teva executives, including Maureen Cavanaugh, former senior vice president and chief commercial officer in North America.
But now it seems states are breaking away from the coordinated effort. Teva’s Mississippi settlement, filed in Pennsylvania federal court on Monday, marks the first agreement the Israeli drugmaker has inked as part of the larger price-fixing debacle.
While the deal is the first, it’s hopefully not the last as Teva works to “replicate these results” through ongoing settlement discussions with other states, spokesperson Kelley Dougherty said in a statement.
“We are very pleased to put these (price-fixing) claims by the state behind us, and we believe the modest settlement amount reflects our position on the lack of evidence for the allegations against us, which we continue to deny,” Dougherty said.
A spokesperson for Mississippi Attorney General Lynn Finch wasn’t immediately available for comment. However, a representative for Tong told Bloomberg that more than 50 states and territories will continue with the complaint.
Unfortunately for Teva, that’s not the only court battle it’s facing related to alleged price-fixing and market manipulation. Last fall, federal prosecutors charged the generic drug giant with conspiring to fix prices for a range of medicines between 2013 and 2015 as part of the industry-wide scheme.
The U.S. Department of Justice claimed the coordinated effort overcharged consumers at least $350 million for a slew of drugs to treat arthritis, seizures, pain, skin conditions, hypertension, cystic fibrosis and blood clots.
Prosecutors indicted Teva on three counts of criminal conspiracy and acting as a ringleader for a group of drugmakers, which reached their own agreements with prosecutors. Teva pleaded not guilty.