Pfizer, Ranbaxy Sued Over Alleged Anti-Competitive Scheme

Pfizer, Ranbaxy Sued Over Alleged Anti-Competitive Scheme

February 7th, 2012 // 1:27 pm @ jmpickett

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Pfizer Inc. and Ranbaxy Laboratories Ltd. were sued in an antitrust case filed in federal court in New York alleging the drugmakers engaged in an anti-competitive scheme to delay a generic version of Lipitor into the market.

The AFL-AGC Building Trades Welfare plan, a health and welfare benefit plan based in Mobile, Alabama, claims that two drugmakers engaged in a monopolization scheme after the Pfizer’s original patent for the cholesterol-lowering drug expired on March 24, 2010.

In the proposed class-action, or group, lawsuit, the plaintiffs allege the drug companies agreed to delay the entry of generic Lipitor for 20 months. As a result of an unlawful agreement with generic-maker Ranbaxy, Pfizer cost purchasers to pay more for Lipitor than they would have paid for the generic version of the drug.

“Defendants’ scheme was successful — generic Lipitor did not become available for sale until November 2011,” the plaintiffs said. “As a result of defendants’ illegal acts, plaintiffs and the indirect purchaser class were forced to pay billions of dollars more for Lipitor than they would have absent defendants’ anticompetitive scheme.”

Both drugmakers were sued in a complaint making similar allegations filed in federal court in San Francisco by 11 California pharmacies in November. In that case, the plaintiffs alleged that they held back on a generic version of the cholesterol-lowering drug in the U.S. and then fixed its price.

Inflated Costs

Lipitor sells for more than $4 a day compared with prices as low as 10 cents day for the generic, the drug stores said in their complaint. Lipitor’s purchasers in the U.S. are paying inflated costs as a result, the pharmacies said.

Sales of Lipitor generated $10.7 billion in revenue for New York-based Pfizer in 2010. A legal settlement with Pfizer gave New Delhi-based Ranbaxy six months’ exclusivity to market generic Lipitor, the world’s best-selling drug.

The lawsuit seeks disgorgement of profits from the allegedly illegal arrangement and triple damages.

“The Federal Trade Commission reviewed the terms of the 2008 settlement,” Chris Loder, a Pfizer spokesman said in a telephone interview. “Pfizer believes the suit has no merit. We are confident that the Lipitor patent settlement with Ranbaxy is appropriate,” he said.

Chuck Caprariello, a spokesman for Ranbaxy, didn’t immediately return a voice-mail message left at his office seeking comment on the complaint.