AG Brown announces $17.85 million in settlements in ongoing drug price-fixing conspiracy case, new complaint against Novartis and subsidiaries

Attorney General Nick Brown and a coalition of 48 states and territories today announced they have won $17.85 million in settlements with Lannett Company, Inc. ("Lannett") and Bausch Health US, LLC and Bausch Health Americas, Inc. ("Bausch"), to resolve allegations that both companies engaged in widespread, long-running conspiracies to artificially inflate and manipulate prices, reduce competition, and unreasonably restrain trade with regard to numerous generic prescription drugs.

These agreements are part of a larger antitrust enforcement action against dozens of companies that conspired to manipulate drug prices. As a result of this conspiracy, consumers had to pay more than 10 times as much for some drugs, ranging from antibiotic ointment to cancer treatments.

As part of today's agreements, Lannett and Bausch have agreed to cooperate in the ongoing multistate litigations against 30 corporate defendants and 25 individual executives. Both companies have further agreed to make internal reforms to ensure fair competition and compliance with antitrust laws.

The Lannett and Bausch settlements follow prior settlements with two other drug companies, Apotex and Heritage, which totaled $49.1 million. These settlements come as the states prepare for the first trial, which will likely take place in late 2026 in Connecticut.

"It's hard to imagine more despicable corporate behavior than conspiring to raise the price of medicine for people who need it," Brown said. "We will continue holding these wrongdoers accountable and secure restitution for Washington consumers and businesses."

Washingtonians who purchased one or more of the generic prescription drugs at issue in the states' cases between May 2009 and December 2019 may be eligible for compensation. Impacted customers can call 1-866-290-0182 (Toll-Free), email [email protected] or visit https://www.AGGenericDrugs.com to determine their eligibility.

Washington and Idaho were the only states in the coalition which also secured restitution for businesses impacted by this conspiracy. Businesses in Washington that indirectly purchased (i.e., purchased the drug from someone other than the manufacturer), paid for, and/or provided reimbursement for some or all of the purchase price for one of more of the generic prescription drugs at issue in the states' cases between May 2009 and December 2019 may be eligible for compensation. For more information, visit https://www.aggenericdrugs.com/English/CorporateEntities.

Brown was joined in the settlement agreement by the attorneys general of Alaska, Arizona, California, Colorado, Connecticut, Delaware, District of Columbia, Florida, Georgia, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota, Northern Mariana Islands, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Utah, U.S. Virgin Islands, Vermont, Virginia, West Virginia, Wisconsin, Wyoming, and Puerto Rico.

Read the agreement here.

New Complaint

Also today, 42 states and territories filed a new lawsuit against Novartis and its generic subsidiary Sandoz alleging they conspired with other generic manufacturers to fix prices, allocate markets and rig bids for 31 different generic drugs. The complaint further alleges that Novartis took steps to fraudulently transfer and drain assets from Sandoz and spin off Sandoz to shield Novartis from liability in the three previously filed state antitrust complaints against the company.

This is the fourth complaint filed in this case. Washington is joined in this complaint by the attorneys general of Alaska, Arizona, California, Connecticut, Colorado, Delaware, District of Columbia, Idaho, Illinois, Indiana, Iowa, Kentucky, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota, Northern Mariana Islands, Ohio, Oklahoma, Oregon, Pennsylvania, Puerto Rico, Rhode Island, South Dakota, Tennessee, Vermont, U.S. Virgin Islands, Virginia, West Virginia, Wisconsin, and Wyoming.

Read the new complaint here.

Case Background

The attorneys general partnered on three other lawsuits against generic drug manufacturers. The first case included Heritage and 17 other companies who allegedly fixed the price of 15 generic drugs. The second case focuses on Teva Pharmaceuticals and 19 of the nation's largest generic drug manufacturers. The third lawsuit will be heard first and involves 26 companies fixing the prices on 80 topical generic drugs that account for billions of dollars in sales. Seven additional pharmaceutical executives have entered into settlement agreements with the states and have been cooperating to support the states' claims.

The cases are built on evidence from several cooperating witnesses at the core of the different conspiracies, a massive document database of over 60 million documents, and a phone records database containing millions of call detail records and contact information for over 600 sales and pricing individuals in the generics industry.

The complaints allege that these companies coordinated their prices during industry dinners, "girls nights out", lunches, cocktail parties, golf outings and communicated via frequent telephone calls, emails and text messages that sowed the seeds for their illegal agreements.

Throughout the complaints, defendants use terms like "fair share," "playing nice in the sandbox," and "responsible competitor" to describe how they unlawfully discouraged competition, raised prices and enforced an ingrained culture of collusion. Among the evidence states collected is a two-volume notebook containing the contemporaneous notes of one of the executives that details his discussions with competitors and internal company meetings over a period of several years.

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