WA, ID, others expand lawsuit against companies over generic drug price fixing

lawsuit

A wide-ranging antitrust investigation by the attorneys general of Washington, Idaho, and 44 other states has uncovered even more involvement in an alleged generic drug price-fixing conspiracy.

The states this week asked a federal court to expand their pending complaint, increasing the number of drug companies named from six to 18, and the number of affected drugs from two to 15.  The states allege the companies violated antitrust laws to artificially inflate the prices of the drugs, and agreed to divvy up the market for the drugs to reduce competition.  Some of the drugs increased in price by more than 1,000 percent.

Generic drugs, which enter the market after a name-brand drug manufacturer loses its exclusive patent rights, offer the prospect of lower prices and greater access to prescriptions for U.S. consumers.  For drugs that attract a large number of generic manufacturers, competition between them can decrease the average price by 80 percent or more, compared to brand-name alternatives.

In July 2014, the state of Connecticut initiated an investigation, later joined by the other states, into suspicious price increases of certain generic pharmaceuticals.  The investigation found evidence of direct conversation between drug company executives and marketing and sales executives in which they discussed efforts to fix and maintain prices, allocate markets and reduce competition for a number of generic drugs.

The lawsuit also alleges that the companies knew their conduct was illegal. (Washington AG)

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