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Is the Antitrust Division Starting a Broad Investigation of Price Fixing in the Generic Pharmaceuticals Market?

November 18, 2014 by Robert Connolly

Ed. Note:  This post is by Joan Marshall, a partner at GeyerGorey and a former Antitrust Division prosecutor who worked on the global vitamin cartel prosecutions.

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Last month, Elijah E. Cummings, the [then] ranking member of the House Committee on Oversight and Government Reform, and Senator Bernard Sanders, [then] chairman of the Senate Subcommittee on Primary Health and Aging, asked 14 generic drug makers to provide data concerning escalating prices charged for generic pharmaceuticals. (here)  Several recent articles, and filings with the SEC, report that the Antitrust Division is also taking a hard look at the generic pharmaceutical industry (here);(here);(here).

A recent analysis found that half of all generic drugs sold through retailers became more expensive over the past 12 months and the prices paid by pharmacies more than doubled for one out of 11 generics (here)(here). The FDA reports that nearly 8 in 10 prescriptions are filled with generic pharmaceuticals. Americans spent about $325.8 billion on prescription medicines in 2012 (here).  Generics now account for 28 percent of pharmaceutical spending (here).

Two generic pharmaceutical companies have reported receiving antitrust related subpoenas, Lannet Company, Inc. and Impax Laboratories . Lannett is headquartered in Philadelphia and was founded in 1942. It develops, manufactures and distributes generic prescription pharmaceutical products in tablet, capsule and oral liquid forms to customers throughout the United States. Lannett markets its products primarily to drug wholesalers, retail drug chains, distributors, and government agencies and its catalog lists 79 generic products. Impax Laboratories is a generic pharmaceutical company headquartered in Hayward, CA. Impax markets at least 133 generic pharmaceutical products. Neither company is among the top five corporations dispersing generic medicines.[1]  [Read more…]

Filed Under: Blog Tagged With: actavis, generic drugs, impax, lanett, lupin, mylan, sandoz, teva

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The US Supreme Court has called cartels "the supreme evil of antitrust." Price fixing and bid rigging may not be all that evil as far as supreme evils go, but an individual can get 10 years in jail and corporations can be fined hundreds of millions of dollars. This blog will provide news, insight and analysis of the world of cartels based on the many years my colleagues and I have as former feds with the Antitrust Division, USDOJ.

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