Introduction
The In Re Glumetza Antitrust Litigation (Case No. 3:19-cv-05822-WHA) is a landmark antitrust case that involves allegations of a reverse payment scheme and market allocation by pharmaceutical companies Bausch Health, Lupin Pharmaceuticals, and Assertio Therapeutics. This case revolves around the diabetes drug Glumetza, an extended-release form of metformin.
Background of Glumetza
Glumetza is a critical medication for treating type 2 diabetes. It was initially marketed by Assertio Therapeutics (formerly Santarus) and later acquired by Bausch Health. The drug's sales were significant, reaching $1 billion in 2016 alone[1][3].
Allegations of Antitrust Violations
The core of the litigation centers on an alleged reverse payment scheme. In 2009, Lupin Pharmaceuticals filed an Abbreviated New Drug Application (ANDA) to market a generic version of Glumetza, challenging the patents held by Assertio. Instead of litigating the patent infringement suit to its conclusion, Assertio and Lupin entered into a settlement agreement. This agreement included a "no-authorized generic" provision, which delayed generic competition and allowed Bausch to maintain a monopoly on the market[2][5].
Impact of the Settlement Agreement
The settlement agreement had profound effects on the market. Bausch was able to raise the price of Glumetza dramatically, from approximately $5.72 per tablet to over $51 per tablet in the first half of 2015. This price hike was facilitated by the absence of generic competition, which was delayed due to the settlement. Even when generic versions eventually entered the market, prices did not return to pre-hike levels[1][2][3].
Class Action Litigation
The case was filed in July 2019 and involved multiple plaintiffs, including direct purchasers and end-payors. The direct purchaser class, certified by Judge William Alsup on August 15, 2020, alleged that the defendants' actions resulted in financial injury due to overpayment for Glumetza. The end-payor class was initially dismissed but some end-payors, like Humana, pursued separate claims in state court[1][2][5].
Settlement Details
The litigation culminated in a significant settlement. Bausch agreed to pay $300 million, Lupin agreed to pay $150 million, and Assertio agreed to pay just under $4 million, totaling $454 million. This settlement was preliminarily approved by Judge William Alsup in September 2021 and received final approval on February 3, 2022[1][3].
Eligibility and Compensation
The settlement benefits entities that purchased generic or brand-name Glumetza directly from Bausch, Lupin, or Oceanside between May 6, 2012, and August 15, 2020. Compensation varies based on the amount of medication purchased, with estimates of $0.0044 per milligram or $4.40 per 1000 mg tablet and $2.20 per 500 mg tablet[3].
Additional Settlements
In addition to the direct purchaser class settlement, the defendants also reached undisclosed settlements with retailer plaintiffs who had opted out of the direct purchaser class. These settlements are believed to total several hundred million dollars[1].
Legal and Regulatory Implications
The case highlights the complexities of antitrust law and the regulatory framework surrounding pharmaceuticals. The "no-authorized generic" provision was crucial in delaying generic competition, allowing the defendants to maintain their monopoly and inflate prices. This scheme underscores the need for vigilant antitrust enforcement to protect consumers from such anticompetitive practices[2][5].
Expert Insights and Industry Impact
Industry experts and legal analysts have emphasized the significance of this case in the broader context of pharmaceutical antitrust litigation. The settlements and the court's rulings serve as a deterrent to similar anticompetitive behaviors in the industry. As noted by Judge William Alsup, the price hike from $5 to $51 per pill is a stark example of the consequences of such schemes[1][2].
Statistics and Financial Impact
The financial impact of the alleged antitrust scheme was substantial. The price increase resulted in billions of dollars in additional drug charges since 2012. The settlements themselves total $454 million, reflecting the severity of the financial injury suffered by the plaintiffs[1][3].
Key Takeaways
- Reverse Payment Scheme: The case involves an alleged reverse payment scheme where Bausch, Lupin, and Assertio delayed generic competition to maintain a monopoly on Glumetza.
- Price Hike: The price of Glumetza increased dramatically from $5.72 to over $51 per tablet due to the absence of generic competition.
- Settlement: The defendants agreed to pay a combined $454 million to settle the antitrust claims.
- Eligibility: Entities that purchased Glumetza directly from the defendants between May 6, 2012, and August 15, 2020, are eligible for compensation.
- Regulatory Implications: The case highlights the importance of antitrust enforcement in the pharmaceutical industry to prevent similar anticompetitive practices.
FAQs
What is the basis of the antitrust claims in the Glumetza litigation?
The antitrust claims are based on an alleged reverse payment scheme where Bausch, Lupin, and Assertio entered into a settlement agreement that delayed generic competition, allowing Bausch to maintain a monopoly on Glumetza[1][2][3].
How much did the price of Glumetza increase due to the alleged scheme?
The price of Glumetza increased from approximately $5.72 per tablet to over $51 per tablet in the first half of 2015[1][2][3].
Who is eligible for compensation under the settlement?
Entities that purchased generic or brand-name Glumetza directly from Bausch, Lupin, or Oceanside between May 6, 2012, and August 15, 2020, are eligible for compensation[3].
What is the total amount of the settlement?
The total amount of the settlement is $454 million, with Bausch paying $300 million, Lupin paying $150 million, and Assertio paying just under $4 million[1][3].
What is the significance of the 'no-authorized generic' provision in this case?
The 'no-authorized generic' provision was crucial in delaying generic competition, allowing the defendants to maintain their monopoly and inflate prices. This provision is a key element of the alleged antitrust scheme[2][5].
Cited Sources
- Schneider Wallace, "Class Plaintiffs Settle With Bausch, Lupin, and Assertio for Glumetza" (October 5, 2021).
- GovInfo, "In re GLUMETZA ANTITRUST LITIGATION" (August 15, 2020).
- Top Class Actions, "Glumetza Price-Fixing $453M Class Action Settlement" (April 5, 2022).
- Casetext, "In re Glumetza Antitrust Litig." (June 29, 2020).
- FindLaw, "IN RE: GLUMETZA ANTITRUST LITIGATION" (2020).
