Major pharmaceutical antitrust news for December 2022, as of January 1st, 2023:

Payor Claims Submission Deadline for $54.4 Million Namenda Pay-For-Delay Class Action Settlement with Allergan and Merz is February 3, 2023. 

On November 4, 2022, the U.S. District Court for the Northern District of California unsealed a September 27, 2022 order certifying two classes of direct purchasers and six classes of end payors in antitrust litigation against Gilead and Janssen for anticompetitive conduct in the market for combination antiretroviral therapy (“cART”) drugs. This litigation has been pending since 2019. The plaintiffs allege that drug makers through a series of agreements frustrated competition from generic products in the cART market.

End-payors submitting a claim in the Namenda class settlement have until February 3, 2023 to submit a claim form, online or by mail, with the necessary spend data included.  On November 14, 2022, the U.S. District Court for the Southern District of New York issued an order preliminarily approving a $54.4 million settlement between a class of indirect purchasers of Namenda on one hand and Allergan and Merz on the other hand. Five of the generic manufacturers who were named as defendants had previously settled with this same class for a total of $1.9 million. The direct purchasers had settled their claims based on the same allegations for $750 million in 2020.

In this case, the end payor plaintiffs accuse Actavis, its subsidiary Forest, development partner Merz, and generic manufacturers of an anticompetitive scheme to delay entry of a generic competitor for Namenda, a drug used to treat symptoms of Alzheimer’s disease. In 2014, Forest pulled its immediate release version of Namenda from the market, substituting a new extended-release version. That new version had a longer patent life, making it easier for Forest to fend off generic competition. As competitors prepared for market entry, Forest leveraged this patent protection by suing generic manufacturers for infringement then entering into the allegedly anticompetitive settlement agreements.

Schneider Wallace Cottrell Konecky has experience assisting companies with claim submissions, including antitrust claims. To contact the antitrust attorneys at Schneider Wallace, contact us at 1-800-689-0024 or info@schneiderwallace.com.

In Re Namenda Indirect Purchaser Antitrust Litigation, No. 1:15-cv-06549 (S.D.N.Y) 

RICO Complaint Filed Against Actelion for Copayment Assistance Charity Scheme 

On December 2, 2022, MSP Recovery Claims filed a complaint against Actelion pharmaceuticals and two non-profits including the Caring Voice Coalition (“CVC”) alleging Actelion and CVC agreed that CVC would act as an illegal conduit, disguised as an independent charity, by which Actelion could funnel kickbacks and bribes to pharmacies in the form of copay assistance through CVC’s disease funds. Actelion and CVC agreed that CVC would create a fund that would almost exclusively serve patients taking the subject Actelion drugs, and that Actelion would be the sole donor to the fund.  

In support of the scheme, Actelion allegedly would obtain data from CVC detailing how many patients taking each of the Actelion drugs CVC had assisted, how much CVC had spent on those patients, and how much CVC expected to spend on those patients in the future. This information was shared to ensure that CVC used the purported donations for Actelion drugs only and allowed Actelion to perform return on investment calculations. Actelion and CVC routinely exchanged information to ensure Actelion possessed sufficient data to maximize returns from its donations. 

On December 5, 2018, Actelion paid $360 million to settle the federal government’s claims that Actelion violated the Anti-Kickback Statute and False Claims Act through this same co-pay assistance scheme involving CVC.  

MSP Recovery Claims, Series LLC, a Delaware Series Limited Liability Company et al. v. Actelion Pharmaceuticals US, Inc. et al., No. 3:22-cv-07604 (N.D.CA) 

Blue Cross Blue Shield of Kansas City Reaches Settlement Related to COVID Healthcare Fraud 

On December 16, 2022, Blue Cross Blue Shield of Kansas City and GS Labs reached a settlement to dismiss claims that GS Labs over-billed for COVID testing services. The proposed settlement would also cover antitrust counterclaims made by GS Labs. GS Labs was accused of misleading patients into taking as many as three different COVID-19 tests and then submitting fraudulent insurance claims with inflated prices up to ten times what they charged cash to uninsured patients, in violation of the CARES Act. 

Private health insurers have been active in trying to recover from COVID testing companies that allegedly induced reimbursements by fraud. Since the fall of 2021, Premera Blue Cross in Washington and Blue Cross Blue Shield of Minnesota have also taken legal action against GS Labs, LLC to recover tens of millions  in overpayments. GS Labs has locations in 9 states: Colorado, Iowa, Indiana, Massachusetts, Minnesota, Missouri, Nebraska, Oregon, and Washington. 

Several recent government enforcement actions have also targeted similar Covid testing schemes. The Department of Justice created a COVID-19 Fraud Enforcement Task Force in May of 2021 to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force focused their efforts on investigating and prosecuting the most egregious domestic and international COVID-related fraud, and to assist with fraud prevention for various agencies in charge of administering relief programs. On April 20, 2022, the DOJ announced a nationwide coordinated law enforcement action to investigate and punish health-care related COVID-19 fraud. Along with the announcement, the DOJ unveiled criminal charges against twenty-one defendants in nine federal districts across the United States for their alleged participation in various healthcare related fraud schemes that exploited the COVID-19 pandemic. The DOJ alleged that these defendants caused over $149 million in COVID-19-related false billings to federal programs and theft from federally funded pandemic assistance programs.

Schneider Wallace Cottrell Konecky has been actively investigating COVID testing fraud in the context of the federal False Claims Act. If you wish to speak with an attorney at Schneider Wallace, contact us at 1-800-689-0024 or info@schneiderwallace.com. 

Premera Blue Cross v. GS Labs LLC, No. 2:21-cv-01399 (W.D. Wash.).

Antitrust Lawyers 

Schneider Wallace Cottrell Konecky has experience representing companies who faced rising costs due to alleged pay-for-delay actions.  Schedule an appointment with our legal team to learn more about antitrust legal options. Our national trial firm maintains offices in California, Texas, North Carolina and Puerto Rico. We represent both businesses and consumers who have suffered damages due to anticompetitive conduct. 

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