Antitrust Class Actions Emerging Against Big Pharma For Alleged Misuse Of Patents

Lawsuits against large pharmaceutical companies alleging the use of inaccurate patent listings to deter competitors from creating generic alternatives to prescription drugs continue to grow.

Teva Pharmaceutical Industries, for instance, was hit with two antitrust class actions in Massachusetts federal court.

The lawsuits were filed by Silver Golub & Teitell, Faruqi & Faruqi, Garwin Gerstein & Fisher, Berger Montague, Odom & Des Roches, Smith Segura Raphael & Leger, and Heim Payne & Chorush.

Both class actions brought claims under Section 4 of the Clayton Act, 15 U.S.C. §§15(a), for injuries due to alleged violations of Section 2 of the Sherman Act, 15 U.S.C. §2, against Teva Pharmaceutical Industries Ltd., Teva Pharmaceuticals USA Inc., Teva Branded Pharmaceutical Products R&D Inc., Norton (Waterford) Ltd. and Amneal Pharmaceuticals Inc.

The named plaintiff in one of the actions is RDC Liquidating Trust, the representative of Rochester Drug Co-Operative Inc., which was created during the company’s bankruptcy proceedings.

The second class action was filed by Value Drug Co., a wholesaler who works with independent pharmacies.

Many of allegations in these cases resemble those flagged by the Federal Trade Commission when it sent warning letters to 10 companies, including Teva, on April 30, disputing more than 300 U.S. Food and Drug Administration’s Orange Book patent listings.

The FTC said it is promoting competition because the disputed patents have delayed less expensive generic drugs from entering the market.

One of the letters was also sent to Boehringer Ingelheim Pharmaceuticals Inc., which also faces an antitrust class action for allegedly using expired patents of its two inhalers, Combivent Respimat and Spiriva Respima, to control market prices.

The lawsuits claimed Teva’s patent for QVAR, “its blockbuster line of brand name asthma inhalers,” was set to expire in July 2015. However, before the patent expired, Teva allegedly submitted improper patent listings, which allowed it to file patent litigation against generic competitors, automatically blocking their entry to the market for 30 months.

Further, Teva allegedly made an “unrequired change” to the mechanics of the inhaler, an anti-competitive strategy called a “product hop,” the complaint said.

“In doing so, Teva stifled would-be generic competitors to QVAR because the drug laws do not allow for generic substitution of a given drug-device combination unless the generic is approved for that specific drug-device combination,” the complaint said. “As a result, QVAR generic equivalents could not be substituted for QVAR Redihaler. Nor could they be substituted for QVAR because Teva pulled it from the market.”

Teva also allegedly “entered into a reverse payment agreement—i.e., an agreement where the generic competitor refrains from launching its product—to bottleneck all competition,” the complaint said. This led to further delay of competition because, under FDA law, the first generic applicant is given six months of marketing exclusively, the complaint said.

“By reaching an agreement with the first applicant not to launch, Teva could delay all competition,” the complaint said.

Media contact for Teva, Kelley Dougherty, declined to comment. Counsel for the defendants has not appeared yet.

Counsel for the plaintiffs did not respond to a request for comment.

The named plaintiffs and other proposed class members are seeking to recover the alleged overcharges on the asthma inhalers.


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