Antitrust Law Daily Apotex to pay $24.1M for fixing prices of cholesterol medication
Thursday, May 7, 2020

Apotex to pay $24.1M for fixing prices of cholesterol medication

By Jeffrey May, J.D.

The generic pharmaceutical company is the fourth to agree to a deferred prosecution agreement in the ongoing probe.

Apotex Corp. has been charged with conspiring with other generic drug companies to fix the price of pravastatin, a commonly prescribed cholesterol medication that lowers the risk of heart disease and stroke. The challenged conduct took place from May 2013 until December 2015. A one-count felony charge was filed today in the federal district court in Philadelphia along with a deferred prosecution agreement (DPA), resolving the case. Under the DPA, Apotex has agreed to pay a $24.1 million criminal penalty, admit to its participation in a conspiracy to artificially raise the price of pravastatin, and cooperate in the ongoing investigation, according to the Department of Justice Antitrust Division (U.S. v. Apotex Corp., Case 2:20-cr-00169-RBS).

Apotex is the fourth company changed in the ongoing probe. In March, Sandoz, Inc. agreed to pay a $195 million criminal penalty to settle charges involving multiple products. The Antitrust Division said that the penalty was the largest ever for a domestic antitrust case. In addition to Sandoz, Rising Pharmaceuticals Inc. and Heritage Pharmaceuticals Inc. have settled similar charges. Four pharmaceutical industry executives have also pleaded guilty for their roles in the conspiracy.

Rationale for DPA. The government explained that the charge was resolved with a DPA because a criminal conviction, including a guilty plea, would have resulted in Apotex’s mandatory exclusion from all federal health care programs for at least five years. Also considered was Apotex’s timely agreement to cooperate and the ongoing cooperation.

Pending civil suits. The Justice Department noted that there are numerous civil actions currently pending against Apotex, including multidistrict litigation consolidated in the federal district court in Philadelphia (In Re: Generic Pharmaceuticals Pricing Antitrust Litigation, Case No. 2:16-md-2724). That MDL involves claims of direct and indirect purchasers, as well as state attorneys general. In light of the availability of civil damages, the government did not seek restitution, according to the Antitrust Division.

Apotex statement. Apotex issued a statement acknowledging the charge and DPA. "Compliance is something we take very seriously, including our compliance with antitrust laws," said Roberta Loomar, Vice-President, General Counsel-US of Apotex Corp. "This activity, occurring several years ago, was clearly against our established compliance policies, training and culture. With this resolution, we are highlighting our commitment to continually improve our compliance and training programs, as well as evolve our controls to ensure full compliance with all antitrust laws."

Attorneys: Carsten M. Reichel, Mark C. Grundvig, Tara M. Shinnick, and Julia M. Maloney for U.S. Department of Justice Antitrust Division. Steven F. Cherry and April N. Williams (Wilmer Cutler Pickering Hale and Dorr LLP) and James W. Matthews (Foley & Lardner LLP) for Apotex Corp.

Companies: Apotex Corp.; Sandoz, Inc.; Rising Pharmaceuticals, Inc.; Heritage Pharmaceuticals Inc.

MainStory: TopStory Antitrust AntitrustDivisionNews GCNNews

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