Perrigo Says Investigators Searched Its Offices in Generic-Drug Probe
May 02 2017 - 11:27PM
Dow Jones News
By Jonathan D. Rockoff
Perrigo Co. said Tuesday its offices were searched by
investigators conducting a federal probe of price collusion in the
generic-drug industry.
The investigators executed search warrants at Perrigo's offices,
according to the company, which didn't say when the offices were
searched, which ones or what, if anything, was seized.
"The company is taking this investigation seriously and is
cooperating with the appropriate authorities," Perrigo said in a
statement.
The price-fixing investigation by the U.S. Department of Justice
has hung for months over the generic-drug industry.
Several companies have received subpoenas seeking information
about drug pricing and communications with competitors, including
Endo International PLC and Mylan NV. Also receiving subpoenas were
Teva Pharmaceutical Industries Ltd. and Actavis, which Allergan PLC
sold to Teva last year.
The execution of search warrants may suggest investigators are
stepping up the probe, searching for evidence to support
allegations of collusion.
Courts have set a high bar for price-collusion cases, requiring
a written document or other evidence of an agreement among
companies to follow each other on prices.
Which particular generic drugs investigators are examining,
along with many other details of the investigation, are
unclear.
Generic drugs, low-price copies of brand-name medicines that
have lost patent protection, are supposed to help cut health-care
spending.
But doctors, patients and hospitals have complained about the
prices of certain generic drugs rising sharply in recent years.
Last year, the Government Accountability Office issued a report
finding that prices of 300 out of 1,441 generic drugs rose 100% or
more at least once between 2010 and 2015.
Dublin-based Perrigo is a leading seller of over-the-counter
cough and cold remedies that retailers sell under their own labels,
as well as generic drugs.
The company's shares have plunged since it rebuffed a takeover
offer worth more than $26 billion from Mylan in 2015 and
subsequently lowering earnings forecasts three times.
The company, whose chief financial officer left in February, has
been trying to increase sales without the price increases and deals
that analysts say had fueled the company's growth.
In February, activist investor Starboard Value LP put three
representatives on Perrigo's board. Starboard has urged the company
to consider selling its generic-drugs business and focus on its
core business of over-the-counter remedies.
(END) Dow Jones Newswires
May 02, 2017 23:12 ET (03:12 GMT)
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