DOJ Says Three Generic Drug Companies Resolve Price-Fixing Allegations

By Michael Dabaie

The U.S. Justice Department said three generic pharmaceutical manufacturers agreed to pay civil settlements to resolve alleged False Claims Act violations in connection with conspiracies to fix the price of various generic drugs.

The DOJ said Taro Pharmaceuticals USA Inc., Sandoz Inc. and Apotex Corp. agreed to pay a total of $447.2 million.

The Justice Department said these conspiracies allegedly resulted in higher drug prices for federal healthcare programs and beneficiaries according.

The government alleged that between 2013 and 2015, all three companies paid and received compensation prohibited by the Anti-Kickback Statute through arrangements on price, supply and allocation of customers with other pharmaceutical manufacturers for some generic drugs manufactured by the companies.

Taro Pharmaceuticals USA agreed to pay $213.2 million, the DOJ said. The Taro drugs allegedly implicated address a variety of health conditions, and include etodolac, a nonsteroidal anti-inflammatory drug used to treat pain and arthritis, and nystatin-triamcinolone cream and ointment, a combination of an antifungal medicine and steroid used to treat certain kinds of skin infections, DOJ said.

Sandoz agreed to pay $185 million. The Sandoz drugs at issue include benazepril HCTZ, used to treat hypertension, and clobetasol, a corticosteroid used to treat skin conditions, the Justice Department said.

Apotex agreed to pay $49 million in connection with its sale of pravastatin, a drug used to treat high cholesterol and triglyceride levels, the DOJ said.

Novartis division Sandoz said the settlement is an expected outcome of the resolution the company reached in March 2020 with the DOJ Antitrust Division. "Today's settlement contains no new factual allegations against Sandoz, and the company fully provisioned for this settlement and disclosed the agreement in principle as part of the March 2020 resolution," the company said.

"As recognized by the DOJ, Sandoz cooperated with the government's investigation. The conduct at issue here occurred at Sandoz from March 2013 through December 2015 in direct contravention of the company's values, policies and trainings in place at the time. The individuals implicated in the underlying conduct are no longer employed by the company," Sandoz said.

Taro said in July 2020 that it resolved DOJ antitrust investigations. Taro said in a July 2020 statement that it resolved all cases involving the company in connection with the multi-year investigations by the DOJ into the U.S. generic pharmaceutical industry.

"We are happy to have reached this global resolution with the DOJ," Taro Chief Executive Uday Baldota said in the July 2020 release. "Taro is committed to the highest level of ethics and integrity and we will continue to fully cooperate with the government on its ongoing investigation into the generic pharmaceutical industry."

DOJ said Friday that in connection with its settlement agreement, each company entered a five-year corporate integrity agreement. The CIAs include internal monitoring and price transparency provisions. They also require the companies to implement compliance measures including risk assessment programs, executive recoupment provisions and compliance-related certifications from company executives and board members, the DOJ said.

Write to Michael Dabaie at michael.dabaie@wsj.com

(END) Dow Jones Newswires

October 01, 2021 13:28 ET (17:28 GMT)

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