Hagens Berman Sobol Shapiro, on behalf of a class of direct purchasers, filed an antitrust lawsuit against pharmaceutical manufacturer Medicis Pharmaceutical Corporation (“Medicis”) and generic drug makers Impax Laboratories, Inc. (“Impax”), Sandoz Inc. (“Sandoz”), and Lupin Limited and Lupin Pharmaceuticals, Inc. (collectively “Lupin”), alleging that the companies used unlawful anticompetitive tactics to suppress generic competition for the acne medication Solodyn for several years, costing payors billions of dollars in overcharges.
According to the first amended consolidated complaint, filed September 19, 2014 in the U.S. District Court for the District of Massachusetts, Medicis and its co-defendants used a number of illegal tactics to prevent the emergence of cheaper generic competitors to Solodyn, the “#1 dermatology medication by dollars in the world.”
First, the complaint alleges that Medicis abused the Food and Drug Administration’s regulatory system by claiming that an invalid and unenforceable patent covered Solodyn. On the basis of that patent, Medicis filed sham patent infringement suits against potential generic competitors (including co-defendants Impax, Sandoz, and Lupin) to delay generic entry. The complaint alleges that in settlements of those actions, Medicis and its would-be competitors entered into unlawful exclusion or “reverse payment” agreements, whereby Medicis paid the generics to stay out of the market until November 2011, concealing the payments through sham side deals.
Second, the complaint alleges that Medicis used the time it bought free of generic competition for older strengths of Solodyn to “switch” or “hop” the Solodyn market from the older strengths to new strengths that could not be automatically substituted for generic versions of the older strengths. And when potential generic competitors then tried to gain approval for generic version of the new strengths, Medicis continued its scheme using the same tactics—sham patent litigation and an unlawful exclusion payment agreement—to delay generic competition in the new strengths.
On August 14, 2015, Judge Denise Casper of the U.S. District Court for the District of Massachusetts granted in part and denied in part defendants’ motion to dismiss the plaintiffs’ claims, allowing claims that the defendants had conspired or combined to unlawfully restrain trade to go forward.
Plaintiffs, led by Hagens Berman and its co-counsel, have continued to vigorously prosecute the case. In 2016 and 2017, after engaging in contested, arm’s-length negotiations spanning many months and involving experienced and highly skilled antitrust counsel, Hagens Berman and co-counsel reached settlements with two of the generic defendants, Sandoz and Lupin. Those settlements, approved on November 27, 2017, provide a total of $4,346,250 in cash to the benefit of the direct purchaser class.
On October 16, 2017, Judge Casper certified a class of direct purchaser plaintiffs for trial, and on December 18, 2017, Judge Casper appointed Hagens Berman as co-lead counsel for the class.
Trial against the remaining defendants – Medicis and Impax – is scheduled to begin in Boston on March 12, 2018.
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