The U.S. Justice Department charged Glenmark Pharmaceuticals, headquartered in India, with conspiring with other generic drug companies to increase and hold prices for the cholesterol drug pravastatin between May 2013 and December 2015.
The U.S. Justice Department charged Glenmark Pharmaceuticals, headquartered in India, with conspiring with other generic drug companies to increase and hold prices for the cholesterol drug pravastatin between May 2013 and December 2015. The charges alleged this resulted in $200 million in gain for the companies involved.
According to the Justice Department, Glenmark is the fifth company to be charged with antitrust violations related to the generic drug industry in the last 13 months. The charges carry a $100 million maximum penalty, which can be increased to twice the amount the companies gained or twice the loss for consumers.
In May, Apotex, one of the companies named as a conspirator, agreed to pay a $24 million penalty. To date, other generic drug companies have paid more than $229 million in settlements with the Justice Department.
Glenmark was charged with one count of conspiracy in restraint of trade. The filing was made in the Eastern District of Pennsylvania.
A Glenmark spokesperson said the allegations are false. The spokesperson said in a statement, “We strongly disagree with the continued allegations being advanced by the Justice Department that persist after months of providing abundant evidence demonstrating that there is no justification for Glenmark to be part of their investigation. These allegations run contrary to the very essence of Glenmark—to drive down drug prices and improve patient access to medications. We will continue to vigorously defend against these allegations that we know to be false, and we are confident the overwhelming evidence will make that clear.”
“By cheating through fixing prices, generic drug companies artificially raised prices even though prescription drug costs were already sky high,” said Makan Delrahim, who heads the Department of Justice’s Antitrust Division. “As today’s charge shows, the Antitrust Division will not hesitate to charge these companies, and litigate where necessary, particularly where their crimes resulted in hundreds of millions of dollars in overcharges for life-saving medications.”
On June 26, Glenmark reported its four quarter and financial year-end earnings. Consolidated revenue was up 7.96%, with consolidated net profit for the quarter increasing 36.28%.
“Our growth momentum sustained in the fourth quarter despite the COVID-19 pandemic and challenging generic business environment across markets globally,” said Glenn Saldanha, chairman of Glenmark. “Our India, Europe and Latin America regions performed well during the quarter. Our sustained performance has been due to the continuous efforts of all our employees around the world. Our manufacturing facilities have operated continuously and facilitated the uninterrupted supply of medicines to operating markets.”
Although sales were up 14.52% in India, 29.26% in Europe, and up 46.9% in Latin America, sales were down 1% in the US, and down 12.65% in Africa, Asia and the CIS Region (Commonwealth of Independent States, formerly part of the former Soviet Union, now Russia).
Company shares dropped almost 5% at the news of the Justice Department charges. However, the company stock climbed almost 120% in the last three months after Glenmark received approval in India to make and sell oral favipiravir, an antiviral drug to treat mild-to-moderate COVID-19 infections.
According to a June 17 Medscape report, Japan has begun a Phase III trial of favipiravir against COVID-19 and in the U.S. a Phase II trial of about 50 patients with COVID-19 is enrolling in collaboration with Brigham and Women’s Hospital, Massachusetts General Hospital, and the University of Massachusetts Medical School. A Phase III trial of favipiravir and umifenovir began in May 2020 in India.
