Teva, Boehringer, and other pharmaceutical companies seek to dismiss indirect purchaser complaints

July 2, 2015 by

white crossTeva Pharmaceuticals USA Inc., Boehringer Ingelheim Pharmaceuticals, Inc., and other pharmaceutical companies are defendants in multidistrict litigation where it is alleged they engaged in a pay-for-delay scheme over the stroke drug Aggrenox.

Our firm and others are representing end-purchaser plaintiffs.  Defendants moved to dismiss the complaints in the Connecticut federal court by six retailers because they didn’t show they directly bought the drug.  The six retailers are Walgreens, RiteAid Corp., Kroger Co., Safeway Inc., Albertsons LLC, and HEB Grocery Co. LP.

The drugmakers argued that none of the six retailers alleges any direct purchases of Aggrenox from the defendants, and therefore their claims are barred by the U.S. Supreme Court’s llinois Brick decision, which limits indirect purchasers from bringing federal antitrust claims.

The drug manufacturers also argued that the six retailers “attempted [an] end-run around Illinois Brick” by relying on partial assignments of claims from three pharmaceutical wholesalers — Cardinal Health Inc., AmerisourceBergen Drug Corp. and McKesson Corp. — that bought the drugs and resold them to the stores.

In March, U.S. District Judge Stefan R. Underhill threw out some of the state law claims that a group of indirect purchasers and Humana had brought, but left the direct purchasers’ federal claims largely intact.

Consolidated in Connecticut, the MDL includes plaintiffs such as wholesaler Miami-Luken Inc. and a slew of workers health and welfare funds that claim they have been purchasing Aggrenox at artificially inflated prices because Boehringer paid off a potential competitor, agreeing to give it a share of Aggrenox’s profits in exchange for delaying sale of the generic for seven years.

Boehringer received the U.S. Food and Drug Administration’s approval for Aggrenox in 1998, and it went on to become a success, netting $366 million in U.S. sales alone by 2008, according to Miami-Luken’s suit. Barr, which was later acquired by Teva, sought regulatory approval in 2007 to introduce a generic version of the drug and was promptly hit with a patent infringement suit by Boehringer, according to court documents.

To settle the patent infringement suit, Boehringer agreed to pay Barr $120 million over a period of seven years to delay the introduction of a generic version of Aggrenox until 2015, according to the complaint. In addition, Boehringer granted Barr a license to sell an authorized generic version of Aggrenox immediately.

Also as part of the deal, Boehringer trained the specialty sales force of Barr subsidiary Duramed Pharmaceuticals Inc., now known as Teva Women’s Health, to promote Aggrenox to obstetricians, gynecologists, and women’s health professionals, the plaintiffs claim.

Walgreens and the other retailers, however, claimed it was unlikely that the co-promotion efforts generated enough prescriptions to justify the payments because Aggrenox’s label warns women in their third trimester to avoid taking the drug.

The MDL is In re: Aggrenox Antitrust Litigation, case number 3:14-md-02516, in the U.S. District Court for the District of Connecticut.

Steve Larson
An experienced trial lawyer who handles both hourly and contingent fee cases, Steve has expertise in class actions, consumer cases, antitrust litigation, securities litigation, corporate disputes, intellectual property disputes, unfair competition claims, employment matters, and disputes involving family wealth. Steve regularly represents individuals and businesses in federal and state court and has obtained class-wide recovery in multiple class actions. A veteran practitioner, Steve's clients value his creative approach to resolving complex litigation matters.

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