A price fixing investigation has expanded to 16 different companies and 300 different generic drugs according to a report by the Washington Post.
Generic drugs — formulations that contain the same medications as brand name products — are in common use, and show up both in “drug cocktails” for HIV treatment as well as HRT care for transgender people.
Generic drugs make up 90% of all prescriptions written in the country, and were a $104 billion-dollar business in 2017. Even a small price manipulation could lead to huge additional profits for companies.
“This is most likely the largest cartel in the history of the United States,” said Joseph Nielsen, a Connecticut assistant attorney general and antitrust investigator who heads the investigation.
The probe began in 2015 with a federal lawsuit filed by 20 state attorneys general alleging that six drug companies were artificially manipulating prices for an oral diabetes drug and an antibiotic medication with the goal of reducing competition.
In one instance, an older drug, albuterol produced by Sun Pharmaceutical and Mylan to treat asthma symptoms saw a 3400% price hike, going from just 13 cents to $4.70 per tablet.
Much of the investigation remains under seal, but many details have emerged. For one, company executives regularly meet over dinner and other outings to set prices, even coming up with their own jargon to discuss their practices.
Those involved called their market the “sandbox,” and expected those in it to cooperate with each other and make sure everyone got their “fair share” of the profits. Those who failed to set their drugs for the agreed upon prices were said to be “trashing the market.”
A federal judge ruled last month that more than 1 million emails, texts, and other materials cited as evidence could be shared by all plaintiffs in the case. That plaintiff pool has also increased since the initial lawsuit, now involving 47 states.
White the companies involved have largely remained mum on the charges, drug maker Teva claimed in a court filing that any allegations of price fixing are, “entirely conclusory and devoid of any facts.”