Drugmaker Celgene has agreed to pay $55 million to settle a class action lawsuit accusing it of violating antitrust laws by interfering with the development of generic versions of two of its cancer drugs.

Plaintiffs in the class action, a group of labor unions and other end payers, moved Wednesday for preliminary approval of the settlement. The suit claimed Celgene repeatedly hiked the prices of its drugs Thalomid and Revlimid while pursuing an anti-competitive scheme against at least 11 makers of generic drugs. The settlement was reached after negotiations with mediator Jed Melnick of JAMS in New York.

Celgene charges up to $500 per capsule for the drugs, and has taken in $17.1 billion selling them from 2009 to 2013, the suit claimed.

Celgene, based in Summit, is in the midst of a deal to be acquired by Bristol-Myers Squibb. The acquisition prompted a suit in Delaware Chancery Court last March by a Celgene investor who claimed the deal undervalued the company and its cancer therapies that are in the development pipeline. The stockholder class action suit claimed that Bristol-Myers was “taking advantage” of a temporary decline in Celgene's stock price to offer investors an estimated $102 in total value for each share they own in Celgene. Bristol-Myers' headquarters are in New York City.

Celgene refuses to sell its product, citing an FDA-mandated distribution program called Risk Evaluation and Mitigation Strategies (REMS), which requires pharmacists and patients to enroll in the program before receiving the drugs.

Thalomid is also known as thalidomide, which was developed in the 1950s as a treatment for morning sickness in pregnant women, but it was taken off the U.S. market in 1962 after it was found to cause severe birth defects. It was approved in 1998 as a treatment for leprosy, and more recently was used in conjunction with steroids to treat multiple myeloma. Revlimid is similar to Thalomid and is also used for myeloma. Approval in 1998 was contingent on participation in the REMS program to ensure pregnant women do not use the drugs.

The Thalomid and Revlimid litigation claimed Celgene violated the Clayton Act and Sherman Act, and raised various antitrust, unfair trade practices and unjust enrichment claims under the laws of several states. Plaintiffs alleged that Celgene listed in the Orange Book and sued to enforce patents that were invalid, refused to sell samples of Thalomid and Revlimid to permit development of generics, encouraged the Food and Drug Administration to reject generics' applications based on sham safety concerns, and entered into anti-competitive settlement agreements with generic manufacturers. Generic equivalents of Thalomid and Revlimid were delayed for years due to the conduct of Celgene, the suit claimed.

The settlement class consists of people or entitles who paid the purchase price of Thalomid or Revlimid in California, the District of Columbia, Florida, Kansas, Maine, Massachusetts, Michigan, Nebraska, New York, North Carolina, Oregon, Pennsylvania, Rhode Island or Tennessee, for consumption by themselves, their families, or their members, employees, insureds, participants or beneficiaries.

Class counsel for the plaintiffs were the firms of Hausfeld; Block & Leviton; and Hach Rose Schirripa & Cheverie.

Hausfeld partner Melinda Coolidge, who worked on the case, said in a statement, “Cancer patients shouldn't have to worry about the rising cost of their life-saving medications. We are very pleased to have achieved such a sizable settlement on behalf of those who have shouldered the cost of these drugs.”

Hausfeld said in its statement that the settlement is “one of the largest pharmaceutical settlements on behalf of end payers (consumers, insurers, union health and welfare funds, municipalities, and others) in an antitrust case in the last decade.”

Whitney Street, a Block & Leviton partner who worked on the case, said in a statement, “We are pleased to have obtained a substantial recovery on behalf of cancer patients and other parties that bear the skyrocketing cost of these lifesaving drugs.”

Lawyers at Williams & Connolly and Lowenstein Sandler who represented Celgene did not respond to requests for comment.