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Attorney General Josh Stein Fights Against Illegally High Drug Prices

For Immediate Release:
Wednesday, June 10, 2020

Contact:
Laura Brewer (919) 716-6484

Multistate Lawsuit Alleges Conspiracy by Generic Manufacturers to Fix Prices for 80 Drugs

(RALEIGH) Attorney General Josh Stein today filed a lawsuit against 26 generic drug manufacturers and 10 individuals who are senior executives at these drug companies. In his lawsuit, Attorney General Stein alleges a widespread conspiracy to artificially inflate and manipulate prices, reduce competition, and unreasonably restrain trade for 80 topical generic drugs. The lawsuit, the third in an ongoing antitrust multistate investigation, seeks damages, civil penalties, and actions by the court to restore competition to the generic drug market.

“Drug costs are too high for North Carolinians as it is,” said Attorney General Josh Stein. “It is not only inexcusable to conspire to fix drug prices, but it’s also illegal. I will do everything in my power to hold these generic drug manufacturers accountable and lower the prices you pay for your medications.”

The complaint alleges longstanding agreements among manufacturers to ensure a “fair share” of the market for each competitor and to prevent “price erosion” due to competition. Between 2007 and 2014, three generic drug manufacturers—Taro, Perrigo, and Fougera (now Sandoz)—sold nearly two-thirds of all generic topical products dispensed in the United States. The multistate investigation has uncovered comprehensive, direct evidence of unlawful agreements to minimize competition and raise prices on dozens of topical products.

The complaint stems from an ongoing investigation built on evidence from several cooperating witnesses at the core of the conspiracy, a massive document database of more than 20 million documents, and a phone records database containing millions of call detail records and contact information for more than 600 sales and pricing individuals in the generics industry. Among the records obtained by the states is a two-volume notebook containing the contemporaneous notes of one of the states’ cooperators that memorialized his discussions during phone calls with competitors and internal company meetings over a period of several years. Another cooperating witness called the notebooks the “Diary of Collusion.”

The topical drugs at the center of the complaint include creams, gels, lotions, ointments, shampoos, and solutions used to treat a variety of skin conditions, pain, and allergies, including adapalene cream (also sold under the brand name Differin) and methylphenidate HCL tablets (also sold under the brand name Ritalin).

This is the third lawsuit Attorney General Stein has filed against generic drug manufacturers. In 2019, Attorney General Stein filed an antitrust lawsuit against 20 generic drug manufacturers and 15 senior executives. In 2017, Attorney General Stein joined a federal generic drug antitrust lawsuit alleging illegal conspiracies to fix prices on 15 drugs that has expanded to include 18 generic drug manufacturers.

The lawsuit names the following defendants:

Corporate defendants:

  1. Sandoz, Inc.
  2. Actavis Holdco U.S., Inc.
  3. Actavis Elizabeth LLC
  4. Actavis Pharma, Inc.
  5. Amneal Pharmaceuticals, Inc.
  6. Amneal Pharmaceuticals, LLC
  7. Aurobindo Pharma USA, Inc.
  8. Bausch Health Americas, Inc.
  9. Bausch Health, US LLC
  10. Fougera Pharmaceuticals, Inc.
  11. G&W Laboratories, Inc.
  12. Glenmark Pharmaceuticals Inc., USA
  13. Greenstone LLC
  14. Lannett Company, Inc.
  15. Lupin Pharmaceuticals, Inc.
  16. Mallinckrodt Inc.
  17. Mallinckrodt plc
  18. Mallinckrodt LLC
  19. Mylan Inc.
  20. Mylan Pharmaceuticals Inc.
  21. Perrigo New York, Inc.
  22. Pfizer, Inc.
  23. Sun Pharmaceutical Industries, Inc.
  24. Taro Pharmaceuticals USA, Inc.
  25. Teligent, Inc.
  26. Wockhardt USA, LLC

Individual defendants:

  1. Ara Aprahamian, the Vice President of Sales and Marketing at Defendant Taro Pharmaceuticals U.S.A., Inc.
  2. Mitchell Blashinsky, former Vice President of Marketing for Generics at Taro Pharmaceuticals U.S.A., Inc. and former Vice President of Sales and Marketing at Glenmark Pharmaceuticals Inc., USA.
  3. Douglas Boothe, former Chief Executive Officer of at Actavis and former Executive Vice President and General Manager at Perrigo New York, Inc.
  4. James Grauso, Executive Vice President, N.A. Commercial Operations at Glenmark, former Vice President of Sales and Marketing at G&W Laboratories, and former Senior Vice President, Commercial Operations at Aurobindo.
  5. Walt Kaczmarek, former Senior Director, National Accounts, Vice President, National Accounts and Senior Vice President, Commercial Operations at Fougera Pharmaceuticals, a division of Nycomed US, Inc. (currently part of Defendant Sandoz, Inc.), and former Vice President – General Manager and President, Multi-Source Pharmaceuticals at Mallinckrodt.
  6. Armando Kellum, former Vice President, Contracting and Business Analytics at Sandoz.
  7. Kurt Orlofski, former President and Chief Executive Officer at Wockhardt USA, and former President at G&W Labs, Inc.
  8. Mike Perfetto, former Vice President of Sales and Marketing at Actavis and former Chief Commercial Officer at Taro.
  9. Erika Vogel-Baylor, former Vice President for Sales and Marketing at G&W Labs, Inc.
  10. John Wesolowski, Senior Vice President of Commercial Operations at Perrigo.

Drugs listed in the complaint as subject to price-fixing and market allocation agreements:

  1. Acetazolamide Tablets
  2. Adapalene Cream
  3. Alclometasone Dipropionate Cream
  4. Alclometasone Dipropionate Ointment
  5. Ammonium Lactate Cream
  6. Ammonium Lactate Lotion
  7. Betamethasone Dipropionate Cream
  8. Betamethasone Dipropionate Lotion
  9. Betamethasone Valerate Cream
  10. Betamethasone Valerate Lotion
  11. Betamethasone Valerate Ointment
  12. Bromocriptine Mesylate Tablets
  13. Calcipotriene Solution
  14. Calcipotriene Betamethasone Dipropionate Ointment
  15. Carbamazepine ER Tablets
  16. Cefpodoxime Proxetil Oral Suspension
  17. Cefpodoxime Proxetil Tablets
  18. Ciclopirox Cream
  19. Ciclopirox Shampoo
  20. Ciclopirox Solution
  21. Clindamycin Phosphate Cream
  22. Clindamycin Phosphate Gel
  23. Clindamycin Phosphate Lotion
  24. Clindamycin Phosphate Solution
  25. Clobetasol Propionate Cream
  26. Clobetasol Propionate Emollient Cream
  27. Clobetasol Propionate Gel
  28. Clobetasol Propionate Ointment
  29. Clobetasol Propionate Solution
  30. Clotrimazole 1% Cream
  31. Clotrimazole Betamethasone Dipropionate Cream
  32. Clotrimazole Betamethasone Dipropionate Lotion
  33. Desonide Cream
  34. Desonide Lotion
  35. Desonide Ointment
  36. Desoximetasone Ointment
  37. Econazole Nitrate Cream
  38. Eplerenone Tablets
  39. Erythromycin Base/Ethyl Alcohol Solution
  40. Ethambutol HCL Tablets
  41. Fluocinolone Acetonide Cream
  42. Fluocinolone Acetonide Ointment
  43. Fluocinonide .1% Cream
  44. Fluocinonide Gel
  45. Fluocinonide Ointment
  46. Fluocinonide Solution
  47. Fluticasone Propionate Lotion
  48. Griseofulvin Microsize Tablets
  49. Halobetasol Propionate Cream
  50. Halobetasol Propionate Ointment
  51. Hydrocortisone Acetate Suppositories
  52. Hydrocortisone Valerate Cream
  53. Imiquimod Cream
  54. Ketoconazole Cream
  55. Latanoprost Drops
  56. Lidocaine Ointment
  57. Methazolamide Tablets
  58. Methylphenidate HCL Tablets
  59. Methylphenidate HCL ER Tablets
  60. Metronidazole Cream
  61. Metronidazole .75% Gel
  62. Metronidazole .1% Gel
  63. Metronidazole Lotion
  64. Mometasone Furoate Cream
  65. Mometasone Furoate Ointment
  66. Mometasone Furoate Solution
  67. Nafcillin Sodium Injectable Vials
  68. Nystatin Ointment
  69. Nystatin Triamcinolone Cream
  70. Nystatin Triamcinolone Ointment
  71. Oxacillin Sodium Injectable Vials
  72. Phenytoin Sodium ER Capsules
  73. Pioglitazone HCL Metformin HCL Tablets
  74. Prochlorperazine Maleate Suppositories
  75. Promethazine HCL Suppositories
  76. Tacrolimus Ointment
  77. Terconazole Cream
  78. Triamcinolone Acetonide Cream
  79. Triamcinolone Acetonide Ointment
  80. Triamcinolone Acetonide Paste

Attorney General Stein is joined in filing this multistate lawsuit by the Attorneys General of Alabama, Alaska, Arizona, Arkansas, Colorado, Connecticut, Delaware, District of Columbia, Florida, Georgia, Territory of Guam, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Dakota, Northern Mariana Islands, Ohio, Oklahoma, Oregon, Pennsylvania, Puerto Rico, Rhode Island, South Carolina, Tennessee, Utah, U.S. Virgin Islands, Vermont, Virginia, Washington, West Virginia, and Wisconsin.

A copy of the complaint is available here.

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