CVS, Rite Aid Accuse AstraZeneca of Conspiracy to Box Out Generic Competitors for Seroquel
The lawsuit, alleging violations of the Sherman Act, seeks overcharge damages, which could be trebled after trial.
October 29, 2019 at 05:53 PM
3 minute read
CVS Pharmacy Inc. and Rite Aid Corp. accused AstraZeneca Pharmaceuticals on Tuesday of conspiring with three generic drugmakers to delay competition for its blockbuster antipsychotic Seroquel XR.
The antitrust lawsuit, filed in U.S. District Court for the Southern District of New York, targeted patent-infringement settlements AstraZeneca had reached with Handa Pharmaceuticals and Accord Healthcare Inc., which had separately sought regulatory approval to bring generic versions of Seroquel to market.
Under those agreements, AstraZeneca agreed to make large "reverse payments" in exchange for promises from Handa and Accord that they would drop their patent fights and agree not to compete with AstraZeneca for up to five years, the complaint said. The lawsuit also names Par Pharmaceutical Inc., a subsidiary of Irish drugmaker Endo International, which acquired Handa's right to apply for generic approval in 2012.
Both agreements, the complaint claimed, created "windfalls" for the defendants and extended AstraZeneca's "market and monopoly power" by postponing competition from cheaper, generic versions of the drug, which generates more than $1 billion in annual sales and is used to treat depression, bipolar disorder and schizophrenia.
"Absent the unlawful non-compete agreements, plaintiffs would have been able to satisfy their requirements for extended-release quetiapine fumarate at significantly lower prices substantially earlier," lawyers for CVS and Rite Aid said in the 69-page filing.
The lawsuit, alleging violations of the Sherman Act, seeks overcharge damages, which could be trebled after trial.
AstraZeneca's press shop did not immediately respond to a call Tuesday afternoon seeking comment on the lawsuit.
In addition to the reverse payments, AstraZeneca agreed not to launch its own authorized Seroquel generic during the first 180 days after Handa and Accord finally brought their products to market. According to the suit, that arrangement further solidified Seroquel's dominance and amounted to cash payments of $164 million and $76 million to Handa and Accord, respectively, during their exclusivity periods.
"AstraZeneca intended these payments to induce Handa/Par and Accord to delay entry into the market for Seroquel XR and its generic equivalents in return for a share of AstraZeneca's monopoly profits," the filing said. "This was a per se illegal naked market allocation or output restriction agreement."
CVS and Rite Aid are represented by Alexander Egerváry, Monica Kiley, Eric Bloom, Barry Refsin, Chelsea Nichols and Caitlin McHugh of Hangley Aronchick Segal Pudlin & Schiller in Philadelphia and Harrisburg.
The case, captioned CVS Pharmacy v. AstraZeneca, has not yet been assigned to a judge.
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