Connecticut’s Attorney General William Tong filed a lawsuit alleging that more than a dozen drug companies participated in a vast conspiracy to artificially keep the prices of generic drugs high for consumers.
“On a widespread basis and among the largest manufacturers and large segments of the market, prices are fixed and the market is rigged and we have emails, text messages, phone records, in person meetings, cooperating witnesses that demonstrate conclusively and without a doubt that the major drug manufacturers are openly and brazenly colluding on price and they’re dividing up market share,” Tong said Monday during a press conference in his Hartford office.
Forty-three states have joined Connecticut’s lawsuit.
The state has been investigating the issue of price fixing going back to the previous Attorney General George Jepsen. Joseph Nielsen, an attorney with the office’s Antitrust and Fraud Unit, was an attorney on the first case filed several years ago.
Nielsen said through subpoenas for documents and communications by drug company employees, the state was able to obtain exchanges between competitors that appear to detail when and how they would hike prices on competing drugs. Nielsen said they were fortunate to identify those communications in the documents they obtained.
“Most of them have been very sophisticated about this and have kept it out of writing,” he said. “Many senior executives at these companies have instructed their employees to keep this out of writing. We happened to catch a few of them who were not as good at that and that has allowed us to better understand how this was all working.”
Among the defendants are Pfizer and Teva, two of the largest drug manufacturers in the world, and Teva is the largest generic drug manufacturer.
Both companies denied any wrong doing in separate statements.
A spokesperson for Teva told NBC Connecticut, “The allegations in this new complaint, and in the litigation more generally, are just that – allegations. Teva continues to review the issue internally and has not engaged in any conduct that would lead to civil or criminal liability. Teva delivers high-quality medicines to patients around the world, and is committed to complying with all applicable laws and regulations in doing so. We will continue to vigorously defend the Company.”
A spokesperson for Pfizer wrote, “The Company has cooperated with the Connecticut Attorney General since it was contacted over a year ago. We do not believe the Company or our colleagues participated in unlawful conduct and deny any wrongdoing. Greenstone has been a reliable and trusted supplier of affordable generic medicines for decades and intends to vigorously defend against these claims.”
Tong said the goal is to win justice for Connecticut customers who were gouged when paying for generic drugs. He said they have evidence that 144 different generic medications saw massive price increases that they allege were in concert across different manufacturers and competitors.
“This is common, every day stuff. As common as frankly aspirin, or pain killers. These are the drugs that all of us in Connecticut take to live,” Tong said. “And that’s why the effort by this group is so profound in its reach and foundational to try and to reduce the cost of American healthcare for all of America’s families.”
Tong says as the case unfolds, he believes a culture of wrongdoing will be exposed within the multi-billion dollar pharmaceutical industry.
He said, “They just go in in the morning and they break the law. Then they have lunch, they come back and they break the law. The go home, they have dinner. They come in the next day and they do it again.”