Humana Sues 37 Drug Makers, Alleges Conspiracy to Fix Prices of Certain Generics

August 8, 2018

The lawsuit alleges that the pharmaceutical companies have conspired to fix, increase, stabilize, and/or maintain the price of a range of generic drugs, including antidepressants and beta-blockers.

Humana has filed a lawsuit against dozens of pharmaceutical companies for allegedly conspiring to fix the prices of certain widely-used generic drugs, ranging from antidepressants to beta-blockers for heart conditions. The lawsuit names 37 pharmaceutical companies, including Mylan, Novartis, and Sandoz.

The nature of the lawsuit, according to Humana, is to recover damages it incurred from the overcharging of these generics.

“In the pharmaceutical industry, generic drug entry predictability typically results in increased price competition, which reduces the price of drugs for wholesalers, retailers, consumers, and third-party payers such as Humana,” stated the court document. “Defendants here, however, along with other generic drug manufacturers, conspired to manipulate the relevant markets, allocating these markets among themselves, and obstruct generic competition.”

Read more about the impact of generics on price competition.

The insurer alleges that the pharmaceutical companies orchestrated the conspiracy through secret communications and meetings, at both private and public events, in order to fix, increase, stabilize, and/or maintain the price of the specified drugs.

Drugs named in the lawsuit include the antidepressants amitriptyline and clomipramine, the muscle relaxant baclofen, the local anesthetic lidocaine, the antifungal nystatin, and the beta-blocker propranolol. According to the insurer, the conspiracy has led to unprecedented increases in the prices of the drugs, including a 2400% increase for amitriptyline, a 600% increase for baclofen, and a 1000% increase for propranolol.

The suit is not the first to allege a conspiracy to fix drug prices among some of the biggest name drug manufacturers. Attorneys general of 47 states, the District of Columbia, and Puerto Rico have filed a civil enforcement against most of the name defendants, alleging an agreement to fix the prices of 15 drugs, 4 of which are included in Humana's suit.

According to Humana, 2 executives of Heritage Pharmaceuticals, named in the suit, have already plead guilty to participating in a conspiracy to fix prices of doxycycline—included in the present complaint—and glyburide, between at least 2013 and 2015.

The allegations made in Humana's suit are based on personal knowledge and information made public during these ongoing investigations, they said.

The lawsuit also comes at a time of increased pressure on the healthcare system reign in prescription drug prices. In May, President Donald Trump announced his “American Patients First” blueprint to drive down prescription drug prices, which included putting an end to the complex system of rebates. Since then, Trump has singled out drug companies, such as Pfizer, for raising drug prices.

HHS Secretary Alex Azar has also made the rounds to several Senate committees, insisting the blueprint would shake up the health system and offering some more detail into how the administration plans to tackle the growing issue of prescription drug prices.