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U.S. states accuse 26 drugmakers of generic drug price fixing lawsuit
- spocklivelong 6y agoI hope that at least one executive ends us spending some jail time, instead of settling the case (which I think is most likely). Price fixing generic drugs will leave out access to those that are most financially vulnerable, all while coporationss make big bucks.
- missedthecue 6y agoYou have to personally break a law to go to prison.
- a3n 6y agoIf a law was broken by a corporation, how could at least one person in that corporation not be guilty of breaking that law? Was it the corporation's AI that did it?
- missedthecue 6y agoBecause you have to prove beyond reasonable doubt that one person broke a specific law. That's not always evident.
- deleted 6y ago[deleted]
- a3n 6y agoEthics laundering. Like money laundering.
- augustt 6y ago“Through phone calls, text messages, emails, corporate conventions, and cozy dinner parties, generic pharmaceutical executives were in constant communication, colluding to fix prices and restrain competition” These things were done by people. Everyone who participated in this _personally_ conspired to commit a crime. Of course this is probably not how it will be seen in the eyes of the legal system.
- vikramkr 6y agoIt will be seen that way - people have gone to jail for antitrust stuff. Especially if one person flips on the others. Is it guaranteed to happen? No, but it might, and it has before.
- mc32 6y agoThat’s one part, the other part is the government has to have a preponderance of evidence of wrongdoing. Courts and lawyers don’t just take the word of the government as ironclad word of god and pronounce judgement. Is it seedy, do people do things to hide evidence, do they go to the edge of the law? Yes of course, but the state still has to prove it’s case.
- maire 6y agoIn the Syprine case, the company was convicted of price fixing by the US supreme court. The company changed its name and then just continued with the same business practices. No hands were really slapped. Companies are made up of people - so if the company you control breaks the law, you have personally broken the law.
- sanarothe 6y agoWell, management responsibility is regulated under CFR 21 820 for medical devices. There are equivalent regulations for pharma. Executives do go to (probation it turns out and apparently not jail all the time) because their company broke the law and they're responsible for the company. https://www.uspharmacist.com/article/new-fda-strategy-criminal-charges-against-pharma-executives https://www.uspharmacist.com/article/new-fda-strategy-crimin...
- vikramkr 6y agoI think at least one is likely to go to prison, like in the Christie's/sotheby's case, especially if someone flips and acts as an informant. Dont count on it being for very long though.
- Gibbon1 6y agoIf officers had to go to jail when their corporations committed crimes then you'd never be able to get competent capitalists to run them. Society and the stockholders would suffer.
- klmadfejno 6y agoSOX already sets up officers to be liable for financial statements, so I don't think this is relevant.
- markdown 6y agoYou're saying that there aren't any honest competent capitalists and that in order to be a "competent capitalist", one must be a crook. You can't conceive of a world where good people can run companies honestly. The only way they'd accept money to run a company is if they're allowed to get away with committing crimes. I don't even know how to respond this one.
- zentiggr 6y agoAwww, poor stockholders. Maybe we'd see a shift toward companies actually being run in responsible and ethical ways, instead of the present, near total disconnect from reasonable actions and constraints.
- twoodfin 6y ago“in” is missing in the HN title. They’re not being accused of filing a price fixing lawsuit, they’re being accused in one.
- dqpb 6y agoThe alleged lawsuit...
- joshstrange 6y agoAlso "U.S. states" = "United States states". In other news, ATM Machines...
- aj7 6y agoIn a related area, foreign factories producing identical
- aj7 6y agoIn a related area, American companies produce on-patent drugs in owned European factories by process-copy-identical methods. They purposely do NOT go through the paperwork of obtaining FDA approval for these processes and factories, though identical. (Of course rigorous European approvals are obtained.) NOW, it becomes illegal to import the European versions into the U.S. and Customs cooperates by random seizure of small shipments, thereby harassing American, mostly older citizens on limited budgets, directly.
- refurb 6y agoThe generic drug industry in the US is pretty unique. Thanks to the Waxman-Hatch generic drug bill in 1984, it went from really hard to get a generic drug approved in the US (you had to start from scratch) to really easy (just prove your drug is the same and use the branded drugs data for approval). As a result, the generic drug industry in the US is very competitive. When a blockbuster drug like Liptior goes generic, you have up to a dozen companies vying to be the first generic approved because that gets you 180 days of exclusivity (you're the only generic, you're cheaper, everyone switches to you). Typically the first generic is priced around 90% of the brand name price (most of it profit), but once other generic companies get approval (after 180 days), the price drop to 5-10% of the branded drug price. This is typically very close to the cost of manufacturing. There are also "generic substitution" laws in most states that require pharmacists to fill prescriptions with the generic. So once the patent runs out, the branded drug loses sales very fast. As a result, the US usually has lower generic drug prices than the EU or Canada.[1] And generic drugs tend to get approval very quickly after the patent expires in the US. However, on the flip side, because the market is so competitive, margins are razor thin. If you want to understand the generic drug market, read the book "The First Question" by Andrew Bodnar. He was convicted by the DOJ for anti-competitive practices as a VP at BMS and wrote the book as a part of his sentencing (book is on the public record). The quote that stuck with me was from Barry Sherman of Apotex (massive Canadian generic drug company). It was something along the lines of "I make zero profit off my drugs. All my profit comes from winning settlements from pharma companies". As a result of the razor thin margins, weird things start to happen. The first is price fixing, as per this article. Nobody wants to compete on price in generic markets (though that's the only differentiator between identical drugs!) because their margins already suck. Allegedly, these companies colluded to not drop prices. The other thing that happens is companies just say "screw it" and drop out of the market. Why not? The profit margin is near zero. This is especially true with companies selling sterile fill product (i.e. injectables). It's really freakin hard and expensive to run a sterile fill plant, so when something goes wrong, companies often just shut down the line. What happens? Drug shortages. Prices rises. Then what happens? Some small company realizes everyone else dropped out of the market. So they quietly get their generic approved and jack the price as high as they can. You'll see a drug that was $0.10 per tablet go to $10 per tablet. Then this attracts other competitors (or sometimes it doesn't), prices drop and the cycle starts again. [1] Can't find exact study, but here's an FDA study comparing generic drug prices between US and Canada: https://www.fda.gov/drugs/resources-you-drugs/study-us-generic-drugs-cost-less-canadian-drugs https://www.fda.gov/drugs/resources-you-drugs/study-us-gener...
- vxNsr 6y agoAnyone have the actual law suit? Or a list of drugs and all the drug makers? Reuters only names 8 of the alleged 26
- Kednicma 6y agoI wanted to know too. Here's the suit [0]. The principal manufacturer targeted is Teva. You'll have to click through for the full list, because it is massive, and has its own entries in the multi-page table of contents. I also wanted to know which states are not (yet) party. They appear to be Arkansas, California, Georgia, New Hampshire, South Dakota, and Wyoming. [0] https://portal.ct.gov/-/media/AG/Downloads/GDMS%20Complaint%2051019%20FINAL%20REDACTED%20PUBLIC%20VERSIONpdf https://portal.ct.gov/-/media/AG/Downloads/GDMS%20Complaint%...
- deathanatos 6y agoGood grief. The article states, > Attorneys general from 46 states, So what four states aren't party? > Arkansas, California, Georgia, New Hampshire, South Dakota, and Wyoming …that's six. So the actual complaint, what does that list? 43 states. Texas. Texas is not in the complaint, plus the six you list. The only way I can get the article's 46 is if I count just the number of lines in the complaint, but Puerto Rico is listed and some states span two lines due to the length of their names. Thankfully we abbreviated Rhode Island.
- vxNsr 6y agoThank you for this, can I ask how you found it? I didn't spend a long time looking but couldn't get anything to show up.
- vxNsr 6y agoTo those that are interested, here's the the full list thanks to Kednicma: TEVA PHARMACEUTICALS USA, INC.; ACTAVIS HOLDCO US, INC.; ACTAVIS PHARMA, INC.; AMNEAL PHARMACEUTICALS, INC.; APOTEX CORP.; ARA APRAHAMIAN; AUROBINDO PHARMA U.S.A., INC.; DAVID BERTHOLD; BRECKENRIDGE PHARMACEUTICAL, INC.; JAMES (JIM) BROWN; MAUREEN CAVANAUGH; TRACY SULLIVAN DIVALERIO; DR. REDDY'S LABORATORIES, INC.; MARC FALKIN; GLENMARK PHARMACEUTICALS, INC., USA; JAMES (JIM) GRAUSO; KEVIN GREEN; GREENSTONE LLC; ARMANDO KELLUM; LANNETT COMPANY, INC.; LUPIN PHARMACEUTICALS, INC.; MYLAN PHARMACEUTICALS INC.; JILL NAILOR; JAMES (JIM) NESTA; PAR PHARMACEUTICAL COMPANIES, INC.; NISHA PATEL; PFIZER, INC.; KONSTANTIN OSTAFICIUK; DAVID REKENTHALER; RICHARD (RICK) ROGERSON; SANDOZ, INC.; TARO PHARMACEUTICALS USA, INC. UPSHER-SMITH LABORATORIES, LLC; WOCKHARDT USA LLC; ZYDUS PHARMACEUTICALS (USA), INC.
- resoluteteeth 6y agoSee also "pay for delay" deals where originator companies pay generic companies not to sell generic versions of a drug.
- julienfr112 6y agoHow can this be remotely legal in a country with anti-trust laws ?
- danbmil99 6y agoI recently switched insurance and was surprised to find that a generic drug I take cost me $500 for 30 tablets. Another generic I take is $10 for a hundred fifty tablets. Pretty sure these ratios have nothing to do with the cost of production.
- hiram112 6y agoIt's doubtful that the insurance company is paying $500 either. I can't believe the type of scam these drug companies run. I take a medication whose patent expired before I was born. Over the years the price has actually gotten more and more expensive in the US, though I've purchased it in the EU for around $20 / month. In the US, using my insurance card, the pharmacy charges me $175. I pay that out of pocket until I hit my deductible of $2K, so it is quite expensive. However, if I don't use my insurance card, the pharmacy has a 'different' price of $40. WTF? My insurance company is apparently in bed with the pharmacy and manufacturer to rip off their own insured customers. So I pay for it with cash for $40 without using my card, and then submit it later towards my deductible (which of course they deny 'till I threaten small claims court). It's absurd and would be a violation of RICO laws for any other industry. Regardless, if you're paying out of pocket due to a high deductible, use GoodRx at the pharmacy without even mentioning your insurance - just pretend you're completely uninsured - and then submit the receipt later. It will save you a lot cash. * https://www.goodrx.com/ https://www.goodrx.com/
- TheOtherHobbes 6y ago"My insurance company is apparently in bed with the pharmacy and manufacturer to rip off their own insured customers." Yes. And so are hospitals and other medical service providers, many of whom are owned by the same companies that own the insurers.
- effingwewt 6y ago+1 for goodrx, they helped a LOT when I was doing residential and commercial carpentry and had a piece of slag bounced off my cheekbone, up under my safety glasses and right into my eyeball. Many flushings and a few days later I go to the ER (after being threatened with being fired if I applied for workman's comp). ER doc numbed my eye and scraped out the slag and metal shards in my eye. Prescribed generic antibiotic eye drops. I thought cool antibiotics arent expensive and per the manufacturer website is literally just diluted penicillin in an eye dropper. Boy was I wrong! 200 with insurance copay, 150 if i paid cash no insurance. Was recommended goodrx by the pharmacist and in 5 mins had created an account and had a valid 'coupon' for the drops at $50. It's incredibly sad this is where our country is at with regards to health care, that we have to find workarounds like this.
- econcon 6y agoMy friend imports medicines from India. While US often accuses Indian companies of selling shoddy quality drugs, it's interesting they wanted HCQ from India and didn't question its quality.
- xtiansimon 6y agoDon't forget the long running lawsuits against prescription drug plan managers [1][2][3]. You can't have a health plan without a prescription drug plan manager, and if you live in NY, CVS Caremark appears again and again on the NY State of Health website--I know, I looked, because CVS Caremark does not cover prescriptions at Walgreens near my home--Anti-competitive fracking bull $#!T. NOTE: I don't know the sources, but the descriptions are sufficient. More research will reveal more coverage--I found SF Chronicle article, but was paywalled. [1]: https://www.wkyc.com/article/money/consumer/whistle-blower-files-lawsuit-against-cvs-caremark-for-falsifying-drug-prices/95-560447195 https://www.wkyc.com/article/money/consumer/whistle-blower-f... [2]: https://www.classaction.org/blog/class-action-cvs-clawback-scheme-overcharges-insured-patients-for-generic-drugs https://www.classaction.org/blog/class-action-cvs-clawback-s... [3]: https://www.modernhealthcare.com/article/20180413/NEWS/180419954/cvs-pharmacy-benefit-manager-unit-sued-for-false-claims https://www.modernhealthcare.com/article/20180413/NEWS/18041...