Schuyler County, Others, File Generic Drug Price Lawsuit

Schuyler County has joined with over two dozen municipal governments, and others, in suing the makers of generic drugs over alleged price-fixing.

 

The county, along with local governments in New York and elsewhere, filed an over 1000-page Summons and Complaint on June 30 against more than fifty companies, seeking injunctive relief, damages, and relief from harms that the complaint alleges resulted from an unlawful agreement among the defendants to allocate customers, rig bids, and fix, raise, maintain, and/or stabilize the prices of all of their generic pharmaceutical products,

 

The lawsuit follows a vote by the County Legislature in 2020, 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 lawsuit is pursuing claims in several areas.  These include increased health insurance premiums for county employees, additional workers’ compensation costs and higher costs of pharmaceuticals purchased for use by the county jail, 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 drugs.”

 

“As alleged, the defendants' anticompetitive 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 more than fifty pharmaceutical defendants, including Teva, Sandoz, Mylan, Pfizer, Actavis, Amneal, Apotex, Aurobindo, Breckenridge, Dr. Reddy’s Laboratories, Glenmark, Greenstone, Lannett, Lupin, Par, Taro USA, Upsher-Smith, Wockhardt USA and Zydus.

 

“As noted, hundreds of generic drugs have been implicated nationwide. Each affected county or municipality can bring an action asserting overpayments for each applicable generic drug,” Getman explained.  “The key question in formulating a lawsuit was determining for which generic drug(s) each county has overpaid, and whether each was direct or indirect purchaser of same.”

 

According to County Administrator Tim O’Hearn, the lawsuit was filed at no risk to the county, as Napoli Shkolnik is working on contingency basis that covers all costs associated with the lawsuit.

“By going forward with the 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. 

 

Locally, along with Schuyler County, Chemung, Yates and Livingston Counties are acting as plaintiffs in the lawsuit. Other municipalities in New York and elsewhere are part of the case as well. The case is currently scheduled to be heard in Federal District Court in eastern Pennsylvania.

 

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.  That case remains pending in state court.  

 

A related trial, involving Nassau and Suffolk counties, and the New York State Attorney General’s Office, is now underway on Long Island against several companies accused of fueling the opioid crisis.  The trial on Long Island will be used as a test for the claims made by Schuyler County and other municipalities in New York, as well as an indicator of what may lie ahead for the drug makers, distributors and pharmacies in other states.

 

A copy of the June 30 complaint is available here.

Schuyler County Legislature to Take Up Resolution Opposing the Issuance of a Permit to Operate A Waste Management Facility in The Town of Cayuta, County of Schuyler.

The Schuyler County Legislature will vote at its October meeting on a resolution opposing a proposed solid waste materials recovery facility in the county.

The resolution passed the legislature’s Community Development and Natural ResourcesCommittee in draft form on Tuesday (September 29, 2020).  It calls upon the Department of Environmental Conservation to reject the proposal of Alternative Waste Services Inc. for a facility in the Town of Cayuta, pending a revised application, additional public comment and “a full, fair and exhaustive environmental review of this project.” 

According to the draft resolution, Alternative Waste Services has proposed building a 10,575 square foot materials recovery facility off NYS Route 13 that would accept municipal solid waste, construction and demolition debris and source-separated recyclables.   The proposal is awaiting final DEC approval.  Earlier in September,  DEC waived a full environmental impact statement after finding that the project would result in no significant adverse impacts on the environment.

Schuyler County Legislature

However, in response to public concern, county officials reviewed the documents submitted to DEC and noted areas of concern with the current application, “which appear to be unaddressed or insufficiently addressed by the DEC review,” the draft resolution notes.  Among the public concerns cited in the draft resolution are that the facility could have potential negative impacts on tourism, agriculture and human health due to truck traffic and water pollution, as well as worries about possible expansion.  Therefore, the draft resolution requests that Alternative Waste Services submit a revised application to address legitimate areas of concern prior to any DEC decision on the project.

 Prior to passing the draft resolution, the committee heard from members of the public who spoke for and against the proposed facility, including a member of the Cayuta Town Board, a representative of Alternative Waste Services and a speaker from Seneca Lake Guardian, a nonprofit advocacy group.

The draft resolution was submitted to the committee by County Planning Director Kristin VanHorn, with input from County Administrator Tim O’Hearn, CountyAttorney Steven Getman and Committee Chairman Mark Rondinaro.

 The full legislature will consider the resolution at its meeting Tuesday October 13, at 6:30 pm at the Schuyler County Human Services Complex in Montour Falls. The public is invited to attend.  COVID-19 social distancing, crowd sizes and other safety measures will be in place.

 A copy of the draft resolution is available here.

Schuyler County Considers Generic Drug Price Lawsuit

Schuyler County 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 drugs.”

“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.

Schuyler County officials make request to visitors during COVID-19 crisis: Stay home, keep everyone safe

As part of the effort to slow the spread of the COVID-19 virus, Schuyler County officials are asking potential visitors to the county to follow state and federal instructions and stay home until our nation defeats the pandemic.  

While Schuyler County welcomes its seasonal residents and visitors, Governor Andrew Cuomo has issued a State of Emergency and Schuyler County has done the same.   

This has been done to protect both county residents and potential travelers during this unsettling and frightening time.

Schuyler County Legislature and other officials. 

In normal times, Schuyler County emergency services and medical facilities are capable of providing excellent care, officials noted.  However, because Schuyler County is rural and has a population of approximately 18,000 people, its emergency and medical communities are limited in their ability to serve a large number of patients.   Statewide, reports have surfaced that hospitals near New York City are already reaching capacity and workers on the frontlines are falling ill.

There is currently no travel ban in New York State, nor is there a state requirement that individuals coming back into the state or between counties within the state be quarantined for fourteen days.    

However, travel between communities has been flagged as a factor in spreading the virus.  For example, the state has seen reports of New York City residents retreating to their second homes in the Hamptons, stressing local hospitals and preventing local businesses from providing necessary goods and services.

On Tuesday (March 24) the White House urged anyone who has been in New York City to self-quarantine for 14 days to stop the spread of the coronavirus, which has become widespread in the city.  

Deborah Minor, Public Health Director

In response to federal and state action, county officials will continue to focus efforts on decreasing population density, which has been proven to slow the spread of the virus.  

Schuyler County Public Health Director Deborah Minor alerted any visitor to follow the same precautions set forth for all community members:

·      Stay home as much as possible.

·   If you must go out into our community, practice social distancing by maintaining six feet from one another.

·  If you are ill, isolate yourself and call your healthcare provider.

·      Wash your hands often.

·      If you have symptoms, such as fever, cough, and shortness of breath, seek testing.

Legislature Chairman Carl Blowers thanked county employees for their efforts in fighting the virus and members of the public for their understanding.

“Together we will get through this and protect those at highest risk for serious illness.  Thank you for your understanding in these unusual times.”

Schuyler County Reorganizes, Blowers elected Chair of legislature

Republican Carl Blowers, of Dix, was elected Chair of the Schuyler County Legislature at its annual reorganizational meeting held Thursday. The vote was unanimous among the legislature’s eight members.

In other action, the legislature reappointed Stacy Husted, of Montour Falls as Clerk of the Legislature, Steven Getman, of Watkins Glen, as Schuyler County Attorney and Wesley Roe as Public Defender. Tim O’Hearn continues at County Administrator.

Prior to the voting, County Court Judge Matt Hayden administered the oath of office to newly elected legislators Mark F. Rondinaro (District VII) and Gary L. Gray (District VIII). Blowers, a retired businessman, was first elected to the legislature in 2014 and re-elected in 2018. He is active in a number of organizations, including: the Watkins Glen Area Chamber of Commerce, the Montour Falls Library, the Arnot Art Museum, the Food Bank of the Southern Tier, the Erie Canal Way Heritage Fund, the United Way of Schuyler County and Catholic Charities of Chemung and Schuyler counties. He has served as a member of the Regional Board of Trustees of Corning Community College as well as its Chairman.

Blowers replaces outgoing chair Dennis Fagan, who did not seek re-election to the legislature.

The County of Schuyler is governed by an eight-person legislature, headed by its Chair. Members serve staggered four-year terms. The legislature, in turn, appoints various department heads to oversee the county’s day to day operations, including the county administrator, public defender, county attorney and clerk to the legislature.

The current members of the legislature are James W.D. Howell, Jr., Gary L. Gray, David M. Reed, Michael L. Lausell, Mark F. Rondinaro, Van A. Harp, Philip C. Barnes and Carl Blowers, Chairman.

New York Court allows opioid claims to go forward against current, former directors of Purdue Pharma

Central Islip, NY--A New York State Supreme Court judge has denied a motion to dismiss cases brought by multiple New York municipalities, including Schuyler County, against current and former directors of opioid manufacturer Purdue Pharma.

In a ruling filed Friday (June 21), Justice Jerry Garguilo found thirty-one counties and two cities had alleged sufficient facts to move forward against various members of the Sackler family in order to recoup millions of dollars in costs tied to the opioid crisis.

Among the local counties and cities making claims are Schuyler County, Seneca County, Steuben County, Tompkins County and the City of Ithaca.

According to Schuyler County Attorney Steven Getman, Schuyler County's claims include public nuisance, negligence, fraud and false advertising. 

Pursuant to the June 21 decision, the Sackler family had argued that they were not vicariously liable for the acts of Purdue’s board of directors and that the cities and counties had failed to allege that any of them participated in making the alleged misstatements in the complaint.

However, Garguilo found that, under New York law, directors may be held individually liable for a company’s tort action if they “directed, controlled, approved or ratified” the decision that lead to the injuries.

The complaint, the judge noted, alleged the Sacklers, as “controlling directors” of Purdue, oversaw the company’s marketing and targeting of doctors.  The Sacklers include former Purdue Chair and president Richard Sackler and seven other members of the family.

A public nuisance claim, the judge wrote, “may be an appropriate tool to address the consequential harm from the defendants’ concerted efforts to market and promote their products for sale and distribution, particularly as such efforts are alleged to have created or contributed to a crisis of epidemic proportions.”

Therefore, Garguilo allowed the cases to go forward, pending further discovery and other pretrial proceedings.

One such case was recently brought by Schuyler County. In August 2017, the County Legislature voted to retain the firm of Napoli Shkolnik to work with Getman, as special counsel, to bring an action against the manufacturers and distributers of prescription opiates for damages to the County. In May 2018, Getman filed a nearly 250-page Summons and Complaint for damages to the county. That case was transferred to Suffolk County Courts shortly thereafter, to join other cases brought by various New York state counties.  The counties later added the Sacklers as individual defendants.

“We applaud the court’s decision,” Getman said. “Schuyler County’s lawsuit will move forward to seek reimbursement for its expenses allegedly related to the opioid crisis as well as to provide the County with financial aid to fight addiction, overdoses, drug-related crimes and drug deaths.”

According to Schuyler County Administrator Tim O’Hearn, the lawsuit was 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 going forward with litigation, the County Legislature hopes to lessen the burden to taxpayers and hold manufacturers and distributors responsible for any role in the opioid epidemic,” O’Hearn said.

Schuyler County is one of several New York municipalities to file lawsuits against the manufacturers and distributors of opioid pain killers. At least thirty-three municipalities across the state are suing pharmaceutical companies for what they claim are deceptive marketing practices.

In addition, in February 2018, New York State officials filed a lawsuit against Insys Therapeutics, Inc., alleging that Insys deceptively promoted prescription opiate Subsys for unsafe uses and violated state law by downplaying drug’s addictive risks.

A copy of the court’s decision can be found here.

A copy of Schuyler County’s Summons and Complaint can be found here

Note: The allegations in a civil complaint are merely accusations and defendants are not considered culpable unless and until accusations are proven by a preponderance of evidence in a court of law.

$20 million federal fine against Rochester-area opioid distributor announced

One of the “big pharma” distributors of prescription opiates being sued by Schuyler County for fraudulent and negligent marketing and distribution of opiates will pay a $20 million fine under an settlement unveiled in federal court on Tuesday (April 23).

Rochester Drug Cooperative, Inc. (RDC), one of the nation's largest pharmaceutical distributors, was charged by federal prosecutors with conspiracy to distribute controlled narcotics — oxycodone and fentanyl — for non-medical reasons and conspiracy to defraud. Prosecutors allege that, from 2012 through March 2017, RDC knowingly and intentionally violated federal narcotics laws by distributing opioids to pharmacy customers that it knew were being sold and used illicitly.

According to court documents, the company has agreed to enter into a “consent decree,” under which it accepts responsibility for its conduct by making admissions and stipulating to an extensive "Statement of Facts," paying a $20 million penalty, reforming its controlled substances compliance program, and submitting to supervision by an independent monitor.

RDC is one of the big pharmaceutical companies being sued in state court by various New York municipalities, including Schuyler County. In May of last year, Schuyler County Attorney Steven Getman filed a nearly 250-page Summons and Complaint in New York State Supreme Court for damages to the county arising out of the fraudulent and negligent marketing and distribution of opiates in the county.

Getman said his office would be carefully reviewing the statement of facts for evidence that could be used to support the county’s lawsuit.

“Schuyler County’s complaint alleges increased opioid use has fueled an illegal secondary market for opioids and the criminals who support it,” Getman said. “It also alleges that the defendants flooded the county with suspiciously large amounts of opioids.”

“To date, county officials have expended significant resources to help its residents battle opioid addiction and prevent further deaths,” Getman said. “Schuyler County’s lawsuit is moving forward to seek reimbursement for expenses related to the opioid crisis as well as to provide the county with financial aid to fight addiction, overdoses, drug-related crimes and drug deaths.”

In 2017, the County Legislature voted to retain the firm of Napoli Shkolnik to work with Getman, as special counsel, to bring an action against the manufacturers and distributers of prescription opiates for damages to the county.

According to Schuyler County Administrator Tim O’Hearn, the lawsuit was 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 going forward with litigation, the County Legislature hopes to lessen the burden to taxpayers and hold manufacturers and distributors responsible for their role in the opioid epidemic,” O’Hearn said.

Schuyler County is one of several New York municipalities filing lawsuits against the manufacturers and distributors of opioid pain killers. At least 14 counties across New York are suing pharmaceutical companies for what they are claiming are deceptive marketing practices.

The consent decree is subject to final approval by the court. Any charges contained in complaints, indictments and other court documents are merely accusations, and any defendants are presumed innocent unless and until proven guilty in a court of law.

Schuyler County joins class action lawsuit against U.S. Department of Interior

Watkins Glen, NY—Schuyler County has successfully opted into a class action lawsuit against the federal government to recover payments in lieu of property taxes on federal lands within the county.

According to Schuyler County Attorney Steven Getman, the county was notified Friday (August 31) that its claim had been accepted in the Kane County, Utah v. United States class action lawsuit to recover federal Payment in Lieu of Taxes (PILT) underpayments for fiscal years 2015 through 2017.

The County Legislature voted August 13 to authorize Getman to file papers joining the lawsuit.

The United States Court of Claims has held that underpayments by the Department of Interior on federal PILT programs in Kane County and other local governments may have occurred during 2015 to 2017, Getman explained.   The PILT Act is intended to compensate local governments for tax revenues lost from federal lands in their jurisdictions, and the costs of providing services to those lands, Getman said.

That could include the part of the Finger Lakes National Forest in the Town of Hector, Getman said.

“If court determines the county was underpaid under PILT agreements for lands in the National Forest, the county can recover additional money” Getman said.   “There is no cost to participate in the lawsuit and no disadvantage to the county to do so.”

According to County Administrator Tim O’Hearn, “any money collected would go to the county as direct revenue to offset the cost of services to the forest and lost tax revenue, in order to reduce the local tax burden.”

“Given the fiscal stresses placed on local governments by state and federal mandates, county officials have a duty to make sure that any funds due Schuyler County taxpayers come back to Schuyler County to pay for necessary services,” Getman noted.

County Treasurer Harriett Vickio has reported that the County received payments for the affected years as follows:  2015, $16,526.00; 2016, $17,244.00; 2017, $17,091.00.   

Any additional amounts for those years obtained from the lawsuit would be calculated by the court, Getman said.

Schuyler and Yates Counties to Share Public Health Director, Expand Shared Services

In a move towards continued cost savings and increased efficiency, Schuyler and Yates counties have adopted resolutions authorizing the sharing of a Public Health Director between the two counties.

At their respective meetings on Monday, August 13, county legislators voted to authorize an Intermunicipal Agreement (IMA) permitting the consolidation of this position within the two counties.

The aim of the project is to work collaboratively while maintaining two distinctive health departments with shared leadership and integrated service delivery. Both departments will be governed by their respective legislatures and/or boards of health.

Yates Chairman Doug Paddock commented “As we continue to seek efficiencies for our residents and taxpayers, this most recent move exemplifies the commitment of both counties towards improving service delivery while lowering costs.”

Schuyler Chairman Dennis Fagan added, “While we continue to struggle with unfunded mandates and their associated escalating costs, it is great to be able to partner with our neighbors to the north, to achieve real savings for our residents.” 

Both Chairs expressed their appreciation to County Attorneys Steven Getman (Schuyler) and Scott Falvey (Yates) for their efforts in crafting an IMA that both Legislatures agreed upon.

The agreement, which now goes to the NYS Department of Health for approval, is in response to the announced retirement of Schuyler Public Health Director Marcia Kasprzyk, and the desire to further collaboration between each county. 

According to Schuyler County Administrator Tim O’Hearn while the combined savings approach $100,000 annually, the move will actually provide increased levels of service as each county shares departmental resources. 

By combining some resources, functions, and staff in their health departments, the two counties provide services that enhance their role as public health facilitators and educators in their respective communities, including:

• ·        Public health education
• ·        Emergency preparedness
• ·        Childhood Early Intervention Programs
• ·        Residential sanitary inspections
• ·        Flu clinics
• ·        Rabies clinics

O’Hearn stated “I commend both Marcia and Deb for their initiative in bringing this recommendation to their respective Legislatures. It is not often in government that such a collaborative and non-parochial approach to administration is achieved and this is a testament to their professionalism and dedication to public health!”

This is the latest shared service initiative between Yates and Schuyler, who currently share a Director of Weights and Measures and Code Enforcement responsibilities.

Both Counties have long recognized that inter-municipal cooperation can help local governments increase effectiveness and efficiency in the delivery of services and is encouraged by the New York State legislature via broad statutory authority.  Here, the counties are taking advantage of legislation passed in 2011 that allows up to three county public health offices in counties with a combined population of less than 150,000 to share staff and services under the management of one public health director.

A County Health Department's mission is to protect and promote the health of its residents through prevention, science and the assurance of quality health care delivery.