Connecticut Attorney General William Tong is taking the leadership role in a 44-state coalition against 20 generic drug manufacturers and 15 pharmaceutical industry executives, charging them with a broad conspiracy to artificially inflate and manipulate prices, thereby reducing competition and restraining trade on more than 100 generic drugs.
The lawsuit, filed in U.S. District Court for the District of Connecticut, argues that companies including Teva, Sandoz, Mylan and Pfizer coordinated an industry-wide campaign to fix prices, allocate markets and rig bids for generic drugs that diseases and conditions ranging basic infections to diabetes, cancer, epilepsy, multiple sclerosis, HIV, ADHD, and more. The attorneys general are charging that some of these coordinated price increases resulted in spikes of more than 1,000 percent.
The complaint also accuses industry executives of planning these actions with each other during industry dinners, “girls’ nights out” events and golf outings, with frequent communications conducted telephone calls, emails and text messages. Defendants used terms like “fair share,” “playing nice in the sandbox,” and “responsible competitor” to describe how they unlawfully discouraged competition, raised prices and enforced an ingrained culture of collusion, the attorneys general added.
The lawsuit seeks damages, civil penalties and actions by the court to restore competition to the generic drug market.
“We have hard evidence that shows the generic drug industry perpetrated a multi-billion-dollar fraud on the American people,” said Tong. “We have emails, text messages, telephone records, and former company insiders that we believe will prove a multi-year conspiracy to fix prices and divide market share for huge numbers of generic drugs. These are drugs that people in this country rely on every day for acute and chronic conditions and diseases from diabetes and cancer to depression and arthritis.
“We all wonder why our health care, and specifically the prices for generic prescription drugs, are so expensive in this country,” he continued. “This is a big reason why. This investigation is still in its early stages. We will not stop until these companies and the individuals who orchestrated these schemes are held accountable.”
New York Attorney General Letitia James, who is part of the coalition of attorneys general, also commented on the depth of the lawsuit.
“The evidence shows a multi-year, multi-faceted conspiracy to enrich pharmaceutical companies at the expense of consumers,” she said. “The scope of the conspiracy is breathtaking, affecting generic drugs that people rely on every day to treat acute and chronic conditions, like diabetes and arthritis. The blatant anticompetitive conduct alleged in the complaint harmed consumers’ health and well-being in multiple way and we intend to hold the wrongdoers accountable.”