AUGUSTA, Maine – Maine joined 19 other states Thursday in a federal lawsuit filed against six generic drug companies alleging they entered into illegal conspiracies to artificially inflate and manipulate prices and reduce competition for a delayed-release antibiotic and an oral diabetes medication, according to the attorney general’s office.
The lawsuit was filed under seal in the U.S. District Court for the District of Connecticut one day after the U.S. Department of Justice accused two former executives at one of the firms of colluding with other generic manufacturers to fix prices.
The drug companies that are defendants in the lawsuit are: Heritage Pharmaceuticals, Inc., Auribindo Pharma USA, Inc., Citron Pharma, LLC, Mayne Pharma (USA), Inc., Mylan Pharmaceuticals, Inc. and Teva Pharmaceuticals USA, Inc., Maine Attorney General Janet Mills said Thursday in a press release. The drugs that are the subject of the lawsuit are doxycycline hyclate and glyburide.
Jeffrey Glazer and Jason Malek, who worked for Heritage Pharmaceuticals, were charged Wednesday in federal court in Philadelphia with conspiring to fix the prices of the antibiotic and to split up the market for the diabetes drug, the justice department said.
Their former employer sued them in August alleging that they were behind a “brazen theft” and “looted tens of millions of dollars from Heritage by misappropriating its business opportunities, fraudulently obtaining compensation for themselves, and embezzling its intellectual property.”
Generic drug pricing became an issue in 2014, driven in large part by media reports of rising drug prices, Reuters reported.
“Many Mainers rely on lower-cost generic prescription drugs in order to make ends meet,” Mills said in the press release. “It is unconscionable for anyone to manipulate the system in order to line their pockets at the expense of people who need access to affordable medications in order to remain healthy. Maine and the other states will stand up for our citizens and against the anticompetitive conduct alleged here.”
Generic drug sales in the U.S. were estimated at $74.5 billion in 2015, she said. Currently, the generic pharmaceutical industry accounts for approximately 88 percent of all prescriptions written in the U.S.
The lawsuit Maine joined alleges that the misconduct was conceived and carried out by senior drug company executives and their subordinate marketing and sales executives. The complaint alleges that the defendants routinely coordinated their schemes through direct interaction with their competitors at industry trade shows, customer conferences and other events, as well as through direct email, phone and text message communications. The anticompetitive conduct — including efforts to fix and maintain prices, allocate markets and otherwise thwart competition — caused significant harmful effects in the country’s healthcare system, the states allege.
The Reuters news agency contributed to this report.