Vyera Settles Antitrust Class Action Over Daraprim
On December 10, 2021, Blue Cross and Blue Shield of Minnesota (“BCBS Minnesota”), on behalf of a putative class of health care end payors, announced a settlement in principle with Vyera Pharmaceuticals, LLC (“Vyera”) and two of its executives, including Martin Shkreli, over their alleged anticompetitive conduct to protect exorbitant price increases for Daraprim. Daraprim is a drug used to treat toxoplasmosis, a parasitic infection most commonly suffered by individuals with compromised immune systems, such as those with HIV/AIDS. The amount and other terms of the settlement have not yet been publicly disclosed.
Vyera acquired the exclusive rights to Daraprim in March 2015. It immediately increased the price of the drug from $13.50 per tablet to $750 per tablet, an increase of more than 4,000 per cent. This price increase led to public outrage and congressional hearings. In order to preserve this price increase in the face of expected generic competition, BCBS Minnesota allege that Vyera: (1) restricted distribution of Daraprim to specialty pharmacies who were not allowed to sell the drug without Vyera’s approval – a power Vyera used to prevent potential generic competitors from obtaining the drug for the required bio-equivalency testing; (2) entered into exclusive supply contracts with the sole FDA-approved supplier and all potential suppliers of Daraprim’s active pharmaceutical ingredient, pyrimethamine; and (3) prohibited distributors of Daraprim from providing sales data to aggregators of market data. A generic version of Daraprim was first made available in 2020 even though it had been sold since 1953 and was not covered by any patents.
BCBS Minnesota’s class action lawsuit followed a similar lawsuit against Vyera and its executives by the FTC and the Attorneys General of New York, California, Illinois, North Carolina, Ohio, Pennsylvania, and Virginia. This action was settled against all defendants other than Shkreli for between $10 million and $40 million, depending on the financial condition of Vyera. An undisclosed portion of this settlement will be used to satisfy the BCBS Minnesota settlement.
BCBSM, Inc. v. Vyera Pharmaceuticals, LLC et al., 1:21-cv-01884 (S.D.N.Y.)