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States Expand Case Against Generic Drug Makers

An ongoing lawsuit filed by Ohio Attorney General Mike DeWine and 45 other state attorneys general had a new development this fall. The attorneys general asked a federal court for permission to add 12 new drug-maker defendants to the lawsuit accusing several generic drug manufacturers of conspiring to reduce competition and inflate prices for certain pharmaceutical drugs.

The expanded complaint would increase the number of drug-manufacturer defendants from six to 18 and the number of drugs at issue from two to 15.

Last year, Attorney General DeWine and 19 other state attorneys general filed a federal antitrust lawsuit against six pharmaceutical companies for conspiring to reduce competition and inflate prices for an antibiotic and a diabetes drug. Since then, 26 other attorneys general joined the litigation. 

The expanded complaint contends that the drug makers made illegal agreements to fix prices and allocate customers for additional generic drugs, including ones used to treat high blood pressure, rheumatoid arthritis, anxiety, epilepsy, and diabetes. The states further allege that this was part of a broad, overarching industry code of conduct that enabled the drug manufacturers to divvy up the market for specific generic drugs in accordance with an established, agreed-upon understanding for assigning each competitor its share of the market.

The attorneys general allege that the defendants’ conduct has artificially increased prices for generic drugs reimbursed by federal and state healthcare programs, such as Medicaid, and raised the coverage costs for employer-sponsored health plans and out-of-pocket costs for consumers. 

The lawsuit currently is pending as part of multidistrict litigation in the U.S. District Court for the Eastern District of Pennsylvania.