Five Indian generic pharmaceutical firms have figured in the latest lawsuit initiated in the US against 26 drug makers for allegedly engaging in anti-competitive practices, including collusion to manipulate the prices of their products.
The third one stemming from an ongoing antitrust investigation reportedly initiated in 2014, the lawsuit focuses on several topical medicines accounting for “billions” of dollars of sales in the US.
Glenmark Pharmaceuticals, Sun Pharmaceuticals, Lupin, Aurobindo Pharmaceuticals and Wockhardt are among the generic firms named in the 606-page suit filed by a coalition of 51 states and territories.
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, according to the office of Connecticut Attorney General William Tong, who led the coalition.According to him, the generic drug makers perpetrated a “multibillion-dollar fraud” on the American public “so systemic that it has touched nearly every single consumer of topical products”. This was done through phone calls, text messages, emails, corporate conventions, and “cozy” dinner parties that allowed generic pharma executives to remain in “constant” communication and help in colluding to “fix prices” and “restrain competition as though it were a standard course of business,” he said.
According to the lawsuit, the drugmakers named operated on a concept of “fair share” and artificial price increases, which often went hand in hand.
Where the Indian drug firms or their American subsidiaries are concerned, it alleges collusion to allocate customers, divide markets and “fix” and raise prices.
For instance, the document alleges that top executives of Glenmark and firms like Sandoz had colluded to fix prices of products like fluticasone propionate lotion and desoximetasone ointment.
“Their communications were all collusive in nature. The two competitors were not friends and had no other reason to speak except to coordinate anticompetitive conduct,” alleged the suit.Glenmark declined to comment on the development, while Sandoz has reportedly disagreed with the claims in the lawsuit.
The suit alleges that Aurobindo, Sun Pharma, Lupin and Wockhardt entered into agreements with their competitors to “allocate customers and divide markets in accordance with the principles of fair share…to fix and raise prices, and to rig bids” for certain generic drugs sold there. In the case of some of these firms, the lawsuit alleges they enjoyed “ill-gotten” gains from such practices.
“These agreements are facially anticompetitive because they allocate customers for the marketing and sale of generic drugs, artificially raise prices, and limit competition between defendant…and its competitors…These agreements have eliminated any meaningful form of price competition in the market for certain generic drugs, including those identified herein,” it alleged in each of these cases. “We do not typically comment on pending litigation,” stated Aurobindo. Queries sent to Sun, Lupin and Wockhardt remained unanswered by press time Thursday.
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