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Thanks to the passage of the Hatch-Waxman Act by Congress in 1984, the U.S. generic drug market has flourished, and American consumers have benefited from less expensive prescription medications. In 2018, nine of 10 prescriptions dispensed in this country were generic, up from three of four in 2009.[1]
As a result, patients and the health care system saved nearly $300 billion in 2018 and $2 trillion from 2009 to 2018.[2] But allegations made in a recent federal indictment filed...
Thanks to the passage of the Hatch-Waxman Act by Congress in 1984, the U.S. generic drug market has flourished, and American consumers have benefited from less expensive prescription medications. In 2018, nine of 10 prescriptions dispensed in this country were generic, up from three of four in 2009.[1]
As a result, patients and the health care system saved nearly $300 billion in 2018 and $2 trillion from 2009 to 2018.[2] But allegations made in a recent federal indictment filed against Teva Pharmaceuticals USA — one of the largest generic drug manufacturers — suggest that the savings over the past several years should have been even greater.
On August 25, the U.S. Department of Justice (DOJ) charged Teva with conspiring to, among other things, fix prices and rig bids for generic drugs.[3] According to the charging indictment, the company allegedly participated in three conspiracies with various other generic drug makers from about May 2013 to December 2015.
In the first conspiracy, Teva allegedly colluded with generic drug companies Apotex Corp. and Glenmark Pharmaceuticals USA, among others, in a scheme to increase prices for the commonly prescribed cholesterol-lowering drug pravastatin and other generic drugs.[4] Apotex in May 2020 admitted to its role in the conspiracy and agreed to pay a $24 million fine.
In the second conspiracy, Teva allegedly schemed with Taro Pharmaceuticals USA and others to fix prices and rig bids for generic drugs used to treat arthritis, seizures, pain, skin conditions and blood clots.[5] In July 2020, Taro acknowledged its role in the conspiracy and agreed to pay a $206 million penalty to resolve these charges and those stemming from another conspiracy.
Finally, Teva was charged with conspiring with Sandoz Inc. and others to fix prices and rig bids for generic drugs used to treat brain cancer, cystic fibrosis, arthritis and hypertension.[6],[7] In March 2020, Sandoz admitted to its role in this conspiracy and agreed to pay a $195 million fine.
The DOJ alleges that Teva’s criminal conspiracies resulted in consumers being overcharged by at least $350 million.[8] Unlike most of the other companies involved in these conspiracies, Teva refused to admit its role in any of them or to settle with the government.
Commenting on the indictment, Steven Stuller, an acting special agent in charge at the U.S. Postal Service Office of Inspector General, said “When generic drug companies conspire to artificially increase prices, they do so to the detriment of many who depend on these medications to maintain good health.”[9]
Therefore, it is imperative that the perpetrators of illegal price-gouging schemes for prescription drugs, such as those alleged in the indictment against Teva, be held accountable.
References
[1] Association for Accessible Medicines. The Case for Competition: 2019 Generic Drug & Biosimilars Access & Savings Report. https://accessiblemeds.org/sites/default/files/2019-09/AAM-2019-Generic-Biosimilars-Access-and-Savings-US-Report-WEB.pdf. Accessed September 3, 2020.
[2] Ibid.
[3] U.S. Department of Justice. Seventh generic drug manufacturer is charged in ongoing criminal antitrust investigation. August 25, 2020. https://www.justice.gov/opa/pr/seventh-generic-drug-manufacturer-charged-ongoing-criminal-antitrust-investigation. Accessed September 3, 2020.
[4] Ibid.
[5] Ibid.
[6] Ibid.
[7] Ibid.
[8] Ibid.
[9] Ibid.
