Attorney General William Tong announced that Heritage Pharmaceuticals and Apotex, two pharmaceutical companies that have been embroiled in a legal battle with 50 states and territories over alleged price-fixing of generic prescription drugs, have agreed to a combined $49.1 million in settlements. The settlements come as the state prepares for its first trial on a related complaint to be held in Hartford.
“Heritage and Apotex both participated in widespread conspiracies to jack up prices and block competition for generic prescription drugs,” said Tong. “Their brazen collusion cost American families and our public healthcare programs millions of dollars. Both companies are now cooperating with our ongoing litigation, and we are very confident in our case heading toward our first trial in Connecticut.”
Today’s settlements stipulate that both companies must cooperate with a Connecticut-led multi-state coalition in several other related suits brought against 30 corporate defendants and 25 executives. It also mandates that the two companies implement internal reform to prevent future infringement of fair competition and antitrust laws. A motion for preliminary approval of a $10 million settlement with Heritage is being filed today in Connecticut’s U.S. District Court, while a $39.1 million settlement deal with Apotex is currently awaiting the necessary signatures from plaintiff states and territories and is expected to be filed soon.
The two companies were accused of breaking antitrust laws, with executives from each found to have engaged in agreements to fix the price of generic pharmaceuticals, raise prices in tandem, and collude for equitable market shares. Investigators compiled over 20 million documents, millions of call records and other contact documentation and 600 drug sales and pricing reps into a database to build their case. In doing so, they found the alleged collusion to have been negotiated both in person and via phone and email. Colloquialisms such as “fair share,” “playing nice in the sandbox,” and “responsible competition” were frequently used by executives to refer to their agreed upon anti-competitive measures.
The first suit was filed against Heritage, 17 individual corporate defendants and 2 other individual defendants in 2016, under the direction of former Connecticut AG George Jensen. This suit came about as the result of an investigation initiated by the state of Connecticut in 2014 in response to price increases of certain generic pharmaceuticals that the state deemed suspicious. 41 other states and territories eventually followed suit by the time the case was settled in 2017. It culminated in two Heritage executives, Jeffery Glazer and Jason Malek, entering into plea agreements in which they agreed to pay $25,000 a piece in civil penalties and to cooperate with the multi-state coalition in related suits.
In 2019, a second related complaint was filed against Teva Pharmaceuticals and another 19 of the country’s largest generic pharmaceutical manufacturers, naming 16 individual senior executives as defendants. A third related complaint filed in 2020 named 26 other corporate defendants and 10 individual defendants, and has focused on the price-fixing of 80 different generic drugs. These three suits combined have thus far led to six additional pharmaceutical executives entering into settlement agreements stipulating their cooperation with investigators.
Connecticut residents who have purchased prescription drugs manufactured by either Heritage or Apotex may be eligible for compensation. Residents are encouraged to call either 1-866-290-0182, visit www.AGGenericDrugs.com or email info@AGGenericDrugs.com to determine their eligibility.
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