Colorado Joins 43 Other States in Lawsuit Alleging Generic Drug Manufacturers Conspired to Inflate Prices

The Denver Post

Colorado is one of 44 states that filed a lawsuit Friday against generic drug manufacturers alleging they violated state and federal laws by conspiring to fix prices and stop competitors, resulting in generic drug costs significantly going up.

The lawsuit, filed in U.S. District Court in Connecticut, alleges that 20 pharmaceutical companies — including Teva Pharmaceutical, Sandoz, Mylan and Pfizer — “embarked on one of the most egregious and damaging price-fixing conspiracies in the history of the United States.”

Teva and other companies raised prices between July 2013 and January 2015 on about 112 generic drugs — some with price increases of more than 1,000 percent, according to the complaint. The lawsuit called it an overarching conspiracy that attempted to thwart competition in the generic drug industry and resulted in inflated drug prices.

“This conduct has resulted in many billions of dollars of overcharges to the Plaintiff States and others, and has had a significant negative impact on our national health and economy,” the lawsuit stated.

The state of Connecticut began investigating the skyrocketing drug prices, leading to the lawsuit and other states signing onto it.

The lawsuit asks for a stop to the alleged illegal practices, civil penalties and an unspecified amount in damages.

The companies coordinated with each other and systematically fixed prices, divided market shares and rigged bids for the drugs, according to the Colorado Attorney General’s Office in a news release.

The inflated prices of the generic drugs encompassed various types of drugs used to treat numerous diseases, including basic infections, diabetes, cancer, epilepsy, multiple sclerosis, HIV, ADHD and others.

“The conspiracy was wide-ranging and well-orchestrated, characterized by a number of blatant acts to cover up the agreement to limit competition between direct competitors,” the news release stated.

A representative for Teva Pharmaceutical USA Inc. did not immediately return a request for comment Sunday. A spokesman for Teva, a subsidiary of Israeli-based Teva Pharmaceutical Industries Ltd, told The Associated Press on Saturday that Teva refuted the allegations.

“The allegations in this new complaint, and in the litigation more generally, are just that — allegations,” Kelley Dougherty, a Teva vice president, said in the statement to the AP. “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.”

Fifteen senior executives were also named in the lawsuit, which alleges that the executives knew what they were doing was unlawful — and tried to cover up communications — but continued to share pricing information and business plans, violating antitrust laws.

“Many Coloradans are struggling to pay for the prescription drugs they need to treat disease or maintain their health. This complaint presents strong and convincing evidence about how the generic drug industry created and enforced a culture of collusion to perpetrate a multi-billion dollar fraud on consumers,” Weiser said in the release.

He added that the companies need to be held accountable for their actions, and he called the case “breath-taking both on account of its impact on consumers and the brazen conduct undertaken by the defendants.”

The news release cites a 2017 Colorado Health Access survey that noted more than 500,000 Colorado residents didn’t fill prescriptions that year because of costs. The inflated costs also affected Medicare and Medicaid, according to the release.

Another lawsuit filed in 2016 in U.S. District Court in the Eastern District of Pennsylvania is also pending, and two former executives entered into settlement agreements.

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A Time to Mourn

PHOTO: HIGHLANDS RANCH, CO - MAY 15: Robots are set up along the pathway at Cherry Hills Community Church for a Celebration of Life service for Kendrick Castillo on May 15, 2019 in Highlands Ranch, Colorado. Two gunman stormed the STEM school last week where Castillo was a student. Castillo with the aid of two friends took one of the gunman down before being shot and killed. 8 other students were injured in the attack. (Photo by Helen H. Richardson/The Denver Post)

There is a time to talk about gun safety and mental health and all of the work that the AG's office is doing to try to save the lives of Colorado students. But today is the time to talk about Kendrick Castillo, the young man who lost his life to protect his classmates. Today is the time to talk about Brendan Bialy and Joshua Jones, who tackled one of the shooters in the school as they saved lives.

Today is the time to think of the little ones leaving classrooms with their hands above their heads in surrender. Their crying faces haunt us. We see our own children in them, and we experience fear and mourning that has, to our terror, become commonplace. Today is the time to think of teachers, who go to work knowing that their classrooms could become a scene of tragedy. Today is the time to think of our eighth graders, seniors, kindergartners, third graders, and every other grade and year from preschool to college and know that they finish their cereal, put on their backpacks, and step into that same reality every single day.

Today is the time to think of them because they asked us to. They want us think of the victims and to mourn with them.

So we mourn for Kendrick. We mourn for those injured. We mourn for the fear and trauma that will never completely heal.

We mourn for the loss of innocence in our own backyards.

Please know that we are working on policy and fighting for better legislation. We came prepared to fight that battle. But we were not ready, and we never will be, to lose more young lives to this violence.

They asked us to think of them. So today, carry their fears with you. Carry their hopes and dreams that will be forever shaken and altered. And know that 20 years from Columbine we have let down an entire generation. Think of them today and carry some of the burden in whatever way you can, so that, maybe, they don't have to bear it alone.

We can and must do better.

Phil