Attorney General Bonta Announces Cooperation Agreements and Settlements with Generic Drug Manufacturers Heritage and Apotex for $49.1 Million

Today’s agreements and settlements will resolve allegations against these companies over conspiracies to inflate prices and limit competition

OAKLAND – California Attorney General Rob Bonta today joined a coalition of 50 states and territories in announcing two significant cooperation agreements and settlements with Heritage Pharmaceuticals and, in the near future, Apotex totaling $49.1 million to resolve allegations that both companies engaged in widespread, long-running conspiracies to artificially inflate and manipulate prices, reduce competition, and unreasonably restrain trade on numerous generic prescription drugs. As part of the settlement agreements, both companies have agreed to cooperate in the ongoing multistate litigations against 30 corporate defendants and 25 individual executives. Both companies have further agreed to a series of internal reforms to ensure fair competition and compliance with antitrust laws. A motion for preliminary approval of the $10 million settlement with Heritage was filed today in the United States District Court for the District of Connecticut in Hartford. A settlement with Apotex for $39.1 million is contingent upon obtaining signatures from all necessary states and territories and will be finalized and filed for approval in the U.S. District Court soon. 

“When drug prices are inflated, it often forces patients to make impossible choices between essential medications and basic necessities, while undermining our healthcare system, which is meant to work for individuals, not corporations,” said Attorney General Bonta. “I am proud to stand with 50 states and territories to hold Heritage and Apotex accountable for their unconscionable action of raising drug prices in order to line their own pockets. At the California Department of Justice, we will continue to root out anti-competitive practices that manipulate drug pricing to ensure a fair market and consumer access to affordable, life-saving medications.”

The three cases against these companies stem from a series of investigations built on evidence from several cooperating witnesses at the core of the different conspiracies alleged in each case, a database of over 20 million documents, and a separate database containing millions of call detail records and contact information for over 600 sales and pricing individuals in the generics industry. Each complaint addresses a different set of drugs and defendants and shows how an interconnected web of industry executives meant to be competitors met up for industry dinners, "girls’ nights out," lunches, cocktail parties, golf outings, and communicated through frequent telephone calls, emails, and text messages, sowing the seeds for their illegal agreements. Defendants used 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 records obtained by the coalition is a two-volume notebook containing the contemporaneous notes of one of the coalition’s cooperators that memorialized his discussions during phone calls with competitors and internal company meetings over a period of several years.

The first complaint included Heritage and 17 other corporate defendants, two individual Defendants, and 15 generic drug manufacturers. Two former executives from Heritage Pharmaceuticals, Jeffery Glazer and Jason Malek, have since entered into settlement agreements and are cooperating. The second complaint was filed Teva Pharmaceuticals and 19 of the nation’s largest generic drug manufacturers. The complaint names 16 individual senior executive defendants. The third complaint, which will be tried first, focuses on 80 primarily topical generic drugs that account for billions of dollars of sales in the United States and names 26 corporate defendants and 10 individual defendants. Six additional pharmaceutical executives have entered into settlement agreements with the coalition and have been cooperating to support the coalition’s claims in all three cases.  Connecticut led a coalition of nearly all states and territories in filing the three antitrust complaints, starting with the first in 2016.

If you purchased a qualifying generic prescription drug between 2010 and 2018, you may be eligible for compensation. To determine your eligibility, call 1-866-290-0182 (Toll-Free), email info@AGGenericDrugs.com, or visit www.AGGenericDrugs.com.

Attorney General Bonta joined the attorneys general of Alaska, Arizona, Colorado, Connecticut, Delaware, District of Columbia, Florida, Georgia, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, 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, Washington, West Virginia, Wisconsin, Wyoming, and Puerto Rico.