legislators are considering a resolution to join Federal, state and municipal
governments in suing the makers of generic drugs over alleged price-fixing.
The County Legislature will vote Monday
(August 10) on a resolution authorizing County Attorney Steven Getman to join
forces with Napoli Shkolnik PLLC, a New York City law firm “in the
investigation and/or prosecution of any legal claim against manufactures of
generic pharmaceuticals and/or their executives based upon their actions in
fixing prices, allocating markets, and engaging in other antitrust violations
or other wrongdoing with respect to generic pharmaceuticals.”
According to Getman, the county
will be investigating claims in several areas.
These include possible overpayments of Medicaid reimbursements,
increased health insurance premiums for county employees and higher costs of pharmaceuticals
purchased for use by county agencies, all based upon artificially inflated
generic drug prices.
Various government agencies have
already commenced suit, Getman said, alleging violations of state and Federal
antitrust laws and consumer protection statutes.
“In 2014, the Department of
Justice began an investigation into the pricing of various generic
pharmaceuticals,” Getman explained. “In the wake of the Federal investigation,
in 2017, the state attorneys’ general of 48 states brought a civil action
alleging price fixing, market division, and other antitrust violations by 16
defendant pharmaceutical companies related to fifteen (15) generic prescription
“As alleged, the defendants'
anti-competitive conduct falls principally into two categories. First, the defendants, allegedly communicated
with each other to determine and agree on how much market share each would
control and which customers each competitor was entitled to. Second, competitors allegedly communicated --
either in person, by telephone, or by text message -- and agreed to
collectively raise and/or maintain prices for a particular generic drug.”
The lawsuits, Getman said, now
involve over 100 generic drugs and 21 pharmaceutical manufacturer defendants,
including Teva, Sandoz, Mylan, Pfizer, Actavis, Amneal, Apotex, Aurobindo,
Breckenridge, Dr. Reddy’s Laboratories, Glenmark, Greenstone, Lannett, Lupin,
Par, Rising, Taro Israel, Taro USA, Upsher-Smith, Wockhardt USA and Zydus.
“The key question in formulating a
lawsuit is determining for which generic drug(s) each county has overpaid, and
whether each was direct or indirect purchaser of same,” Getman explained. “As noted, hundreds of generic drugs have been
implicated. Each affected county or municipality can bring an action asserting
overpayments for each applicable generic drug.”
According to County AdministratorTim O’Hearn, any lawsuit will be filed at no risk to the county, as Napoli
Shkolnik will work on contingency basis that will cover all costs associated
with the lawsuit.
“By voting to go forward with possible
litigation, the County Legislature hopes to lessen the burden to taxpayers and
seeks to hold manufacturers responsible for any unlawful role in the high cost
of generic drugs,” O’Hearn said.
Separately, three other New York
counties (Greene, Schenectady and Essex)
are already working with Napoli Shkolnik on a lawsuit likely to be heard in Federal
court in eastern Pennsylvania, and the state Association of Counties last month
circulated a memo suggesting other counties consider joining the effort.
In addition to the generics case,
Schuyler County has been working with Napoli Shkolnik to prosecute a pending
action against the manufacturers and distributers of prescription opiates for
damages to the county arising out of the fraudulent and negligent marketing and
distribution of opiates in and to the county.
The next regular meeting of the Schuyler
County Legislature will be held in the Schuyler County Human Services Building,
323 Owego Street, Montour Falls, New York on Monday, August 10, 2020 at 6:30 pm. The meeting is open to the public and all required
COVID-19-related safety protocols will be in place.
A copy of the county’s
proposed resolution is available here.