Attorney General Eric Schmitt Sues Teva, Drug Manufacturers, 15 Individuals Alleging Price Fixing Scheme on Over 100 Generic Drugs

One of the largest and most damaging price fixing schemes in history

Jefferson City, MO (STL.News) – Missouri Attorney General Eric Schmitt announced today that the state of Missouri is joining the State of Connecticut’s lawsuit against Teva Pharmaceuticals and 19 of the nation’s largest generic drug manufacturers, alleging that the companies drastically inflated and manipulated prices, reduced competition and unreasonably restrained trade for more than 100 different generic drugs.  This is one of the most damaging and far-reaching price fixing schemes in modern history, with certain companies inflating prices by nearly 1,000 percent.

“Millions and millions of Americans rely on generic prescription drugs every day to treat diabetes, infections, depression, cancer, HIV, and more.  This price fixing scheme by Teva Pharmaceuticals and other industry giants demonstrates a level of corporate greed the state of Missouri and the country rarely sees,” said Attorney General Schmitt.  “By joining this lawsuit we’re sending a clear message to pharmaceutical companies: if you harm any of the 6 million people that call Missouri home, we will pursue action and hold you accountable for your actions.”

The lawsuit, filed in U.S. District Court for the District of Connecticut, also names 15 individual senior executive defendants at the heart of the conspiracy who were responsible for sales, marketing, pricing and operations.  The drugs at issue account for billions of dollars of sales in the United States, and the alleged schemes increased prices affecting the health insurance market, taxpayer-funded healthcare programs like Medicare and Medicaid, and individuals who must pay artificially-inflated prices for their prescriptions drugs.

The complaint alleges that Teva, Sandoz, Mylan, Pfizer and 16 other generic drug manufacturers engaged in a broad, coordinated and systematic campaign to conspire with each other to fix prices, allocate markets and rig bids for more than 100 different generic drugs.  The drugs span all types, including tablets, capsules, suspensions, creams, gels, ointments, and classes, including statins, ace inhibitors, beta blockers, antibiotics, anti-depressants, contraceptives, non-steroidal anti-inflammatory drugs, and treat a range of diseases and conditions from basic infections to diabetes, cancer, epilepsy, multiple sclerosis, HIV, ADHD, and more.  In some instances, the coordinated price increases were over 1,000 percent.

The complaint lays out an interconnected web of industry executives where these competitors met with each other during industry dinners, “girls nights out”, lunches, cocktail parties, golf outings and communicated via frequent telephone calls, emails and text messages that sowed the seeds for their illegal agreements.  Throughout the complaint, defendants use terms like “fair share,” “playing nice in the sandbox,” and “responsible competitor” to describe how they unlawfully discouraged competition, raised prices and enforced an ingrained culture of collusion.

The lawsuit seeks damages, civil penalties and actions by the court to restore competition to the generic drug market.

The complaint is the second to be filed in an ongoing, expanding investigation by the Connecticut Office of the Attorney General.  The first complaint, still pending in U.S. District Court in the Eastern District of Pennsylvania, was filed in 2016 and now includes 18 corporate defendants, two individual defendants, and 15 generic drugs.  Two former executives from Heritage Pharmaceuticals, Jeffery Glazer and Jason Malek, have entered into settlement agreements and are cooperating with the Attorneys General working group in that case.

In addition to Connecticut, Alabama, Alaska, Arizona, Colorado, Delaware, Florida, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Utah, Vermont, Virginia, Washington, West Virginia, Wisconsin and Puerto Rico joined the suit.

Corporate Defendants:

  • Teva Pharmaceuticals USA, Inc.
  • Sandoz, Inc.
  • Mylan Pharmaceuticals Inc.
  • Actavis Holdco US, Inc.
  • Actavis Pharma, Inc.
  • Amneal Pharmaceuticals, Inc.
  • Apotex Corp.
  • Aurobindo Pharma U.S.A., Inc.
  • Breckenridge Pharmaceutical, Inc.
  • Dr. Reddy’s Laboratories, Inc.
  • Glenmark Pharmaceuticals Inc. USA
  • Greenstone LLC
  • Lannett Company, Inc.
  • Lupin Pharmaceuticals, Inc.
  • Par Pharmaceutical Companies, Inc.
  • Pfizer, Inc.
  • Taro Pharmaceuticals USA, Inc.
  • Upsher-Smith Laboratories, LLC
  • Wockhardt USA, LLC
  • Zydus Pharmaceuticals (USA), Inc.

Individual defendants:

  • Ara Aprahamian, Vice President of Sales and Marketing at Taro Pharmaceuticals U.S.A, Inc.
  • David Berthold, Vice President of Sales at Lupin Pharmaceuticals, Inc.
  • James Brown, Vice President of Sales at Glenmark Pharmaceuticals, Inc.
  • Maureen Cavanaugh, former Senior Vice President and Chief Commercial Officer, North America, for Teva
  • Marc Falkin, former Vice President, Marketing, Pricing and Contracts at Actavis
  • James Grauso, former Senior Vice President, Commercial Operations for Aurobindo from December 2011 through January 2014. Since February 2014, Grauso has been employed as the Executive Vice President, N.A. Commercial Operations at Glenmark
  • Kevin Green, former Director of National Accounts at Teva from January 2006 through October 2013. Since November 2013, Green has worked at Zydus Pharmaceuticals (USA) Inc. as the Vice President of Sales
  • Armando Kellum, former Vice President, Contracting and Business Analytics at Sandoz
    Jill Nailor, Senior Director of Sales and National Accounts at Greenstone
  • James Nesta, Vice President of Sales at Mylan
  • Kon Ostaficiuk, the President of Camber Pharmaceuticals, Inc.
  • Nisha Patel, former Director of Strategic Customer Marketing and later, Director of National Accounts at Teva.
  • David Rekenthaler, former Vice President, Sales US Generics at Teva
  • Richard Rogerson, former Executive Director of Pricing and Business Analytics at Actavis
  • Tracy Sullivan DiValerio, Director of National Accounts at Lannett

Drugs listed in the complaint as subject to price-fixing and market allocation agreements:

  • Adapalene Gel
  • Amiloride HCL/HCTZ Tablets
  • Amoxicillin/Clavulanate Chewable Tablets
  • Amphetamine/Dextroamphetamine ER (aka Mixed Amphetamine Salts)
  • Amphetamine/Dextroamphetamine IR
  • Azithromycin Oral Suspension
  • Azithromycin Suspension
  • Baclofen Tablets
  • Benazepril HCTZ
  • Bethanechol Chloride Tablets
  • Budesonide DR Capsules
  • Budesonide Inhalation
  • Bumetanide Tablets
  • Buspirone Hydrochloride Tablets
  • Cabergoline
  • Capecitabine
  • Carbamazepine Chewable Tablets
  • Carbamazepine Tablets
  • Cefdinir Capsules
  • Cefdinir Oral Suspension
  • Cefprozil Tablets
  • Celecoxib
  • Cephalexin Suspension
  • Cimetidine Tablets
  • Ciprofloxacin Tablets
  • Clarithromycin ER Tablets
  • Clemastine Fumarate Tablets
  • Clomipramine HCL
  • Clonidine TTS Patch
  • Clotrimazole Topical Solution
  • Cyproheptadine HCL Tablets
  • Desmopressin Acetate Tablets
  • Desogestrel/Ethinyl Estradiol Tablets (Kariva)
  • Dexmethylphenidate
  • Dextroamphetamine Sulfate ER
  • Diclofenac Potassium Tablets
  • Dicloxacillin Sodium Capsules
  • Diflunisal Tablets
  • Diltiazem HCL Tablets
  • Disopyramide Phosphate Capsules
  • Doxazosin Mesylate Tablets
  • Drospirenone and ethinyl estradiol (Ocella)
  • Enalapril Maleate Tablets
  • Entecavir
  • Epitol Tablets
  • Estazolam Tablets
  • Estradiol Tablets
  • Ethinyl estradiol and levonorgestrel (Portia and Jolessa)
  • Ethosuximide Capsules
  • Ethosuximide Oral Solution
  • Etodolac ER Tablets
  • Etodolac Tablets
  • Fenofibrate
  • Fluconazole Tablets
  • Fluocinonide Cream
  • Fluocinonide Emolient Cream
  • Fluocinonide Gel
  • Fluocinonide Ointment
  • Fluoxetine HCL Tablets
  • Flurbiprofen Tablets
  • Flutamide Capsules
  • Fluvastatin Sodium Capsules
  • Gabapentin Tablets
  • Glimepiride Tablets
  • Griseofulvin Suspension
  • Haloperidol
  • Hydroxyurea Capsules
  • Hydroxyzine Pamoate Capsules
  • Irbesartan
  • Isoniazid
  • Ketoconazole Cream
  • Ketoconazole Tablets
  • Ketoprofen Capsules
  • Ketorolac Tromethamine Tablets
  • Labetalol HCL Tablets
  • Lamivudine/Zidovudine (generic Combivir)
  • Levothyroxine
  • Loperamide HCL Capsules
  • Medroxyprogesterone Tablets
  • Methotrexate Tablets
  • Mimvey (Estradiol/Noreth) Tablets
  • Moexipril HCL Tablets
  • Moexipril HCL/HCTZ Tablets
  • Nabumetone Tablets
  • Nadolol Tablets
  • Niacin ER Tablets
  • Nitrofurantoin MAC Capsules
  • Norethindrone/ethinyl estradiol (Balziva)
  • Northindrone Acetate
  • Nortriptylline Hydrochloride Capsules
  • Omega-3-Acid Ethyl Esters
  • Oxaprozin Tablets
  • Oxybutynin Chloride Tablets
  • Paricalcitol
  • Penicillin VK Tablets
  • Pentoxifylline Tablets
  • Piroxicam
  • Pravastatin Sodium Tablets
  • Prazosin HCL Capsules
  • Prochlorperazine Tablets
  • Propranolol HCL Tablets
  • Raloxifine HCL Tablets
  • Ranitidine HCL Tablets
  • Tamoxifen Citrate Tablets
  • Temozolomide
  • Tizanidine
  • Tobramycin
  • Tolmetin Sodium Capsules
  • Tolterodine ER
  • Tolterodine Tartrate
  • Topiramate Sprinkle Capsules
  • Trifluoperazine HCL
  • Valsartan HCTZ
  • Warfarin Sodium Tablets