In a noteworthy development within the ongoing campaign against antitrust transgressions in the pharmaceutical field, Teva Pharmaceuticals and Glenmark Pharmaceuticals have reached an agreement to settle fines and divest specific products as part of a deferred prosecution arrangement with the U.S. Department of Justice (DOJ). Both companies have acknowledged their involvement in price-fixing schemes, leading to substantial penalties and the requirement to divest.
Teva Pharmaceuticals has been imposed a considerable $225 million penalty over a span of five years, signifying the largest fine ever imposed in a domestic antitrust collusion case. The company has communicated its intention to disburse $22.5 million annually from 2024 through 2027, with the remaining $135 million scheduled for payment in 2028.
Allegations against Teva Pharmaceuticals:
The pharmaceutical manufacturer has been found culpable of partaking in three instances of price-fixing, targeting crucial medications including the generic cholesterol medicine pravastatin, clotrimazole (a treatment for skin infections), and tobramycin (commonly prescribed for eye infections). Teva’s penalty, in conjunction with other related settlements, aggregates the total sum of criminal fines to surpass $681 million.
The DOJ’s antitrust division has been actively probing price-fixing practices within the pharmaceutical sector since 2020. The accords entered into by Teva and Glenmark constitute the latest resolutions in a succession of cases involving similar circumstances, wherein competitors collaborate to artificially escalate product prices, consequently depriving consumers of reasonably priced access to vital medicines.
Regarding these settlements, the assistant attorney general of the DOJ’s antitrust division, stated, “Today, the Antitrust Division and our law enforcement partners hold two more pharmaceutical companies accountable for raising prices of essential medicines and depriving Americans of affordable access to prescription drugs.”
Glenmark Pharmaceuticals, a collaborator in Teva’s price-fixing undertakings, has concurred to a $30 million fine. Glenmark’s participation in the conspiracy centered around the cholesterol medication pravastatin, wherein it colluded with Teva to manipulate prices. As part of the deferred prosecution agreement, Glenmark will also divest its version of pravastatin.
The deferred prosecution agreement enables the companies to avoid criminal trials and penalties, contingent on their adherence to the terms outlined. Both Teva and Glenmark have acknowledged their misconduct and have committed to collaborating in eradicating price-fixing practices from their operations. Conviction could potentially result in exclusion from federal healthcare initiatives such as Medicare and Medicaid.
As a facet of their settlements, Teva has committed to donating $50 million worth of generic drugs impacted by the price-fixing schemes to charitable organizations serving underprivileged Americans. This restitution underscores their resolve to mitigate the adverse repercussions of their actions on patients reliant on reasonably priced medications.
Teva Pharmaceuticals, in a press release, has underscored its dedication to preventing the recurrence of such unethical activities. The company’s robust compliance controls are tailored to ensure adherence to equitable market practices and thwart collusive behaviors that harm consumers.
Likewise, in an official statement, Glenmark emphasized its commitment to upholding societal and ethical obligations as a corporation. The company highlighted its substantial allocation of resources to bolster compliance procedures, with the aim of upholding the most stringent ethical operational standards.
