(NaturalNews) The office of the New York Attorney General and the American units of Ranbaxy Laboratories Ltd. and Teva Pharmaceutical Industries Ltd. have come to terms on a settlement involving claims that an agreement between the two Big Pharma companies restricted competition unlawfully.
Both companies agreed to pay a small fine (by comparison) of $150,000 to New York State and to cease making similar agreements in the future as part of the settlement, Reuters reported. Neither company admitted or denied the allegations, but the settlement absolves them of having to do so.
By settling, the companies have ended an investigation that was being conducted by the state into an agreement that was signed by both in 2010 to sell a generic version of Pfizer, Inc.'s cholesterol-lowering drug Lipitor in the U.S., while not horning in on the exclusivity rights of other generic drugs sold by the pharmaceutical companies. Per Reuters:
The agreement was drawn up as a contingency plan to allow Israel's Teva to sell the generic Lipitor, or atorvastatin calcium, in case Ranbaxy's version was not approved by the U.S. Food and Drug Administration before Lipitor lost its patent protection on November 30, 2011.
While India's Ranbaxy, majority-owned by Japan's Daiichi Sankyo Co Ltd, eventually got FDA approval in time, the agreement remained in place and could have been used to protect other drugs made by the two companies.
"Agreements between drug manufacturers to protect each other's market positions violate fundamental principles of antitrust law, and can lead to higher drug prices," Attorney General Eric Schneiderman said in a statement.
While the agreement related only to the sale of the one drug, it included a "no-challenge" clause, which allowed both companies to shield from competition, as well as legal and regulatory challenges, scores of other medications, according to the NY attorney general's office, which added, however, that no anti-competitive effects due to the agreement had been identified during the investigation.
Schneiderman says the entire ordeal represents the application of a recent legal precedent that arose from challenges of "pay-for-delay" agreements that were established between makers of brand-name and generic drugs.
Those deals, where a brand-name Pharma company pays a generic rival not to sell their versions of a drug at a much-reduced price, have caught the attention of regulators in countries all over the world, because such agreements raise patient-care costs as well as the public sector's costs to cover healthcare treatments.
"Ranbaxy... continues to believe that the agreement was pro-competitive and an important part of making the product readily available to patients and the U.S. healthcare system in a timely fashion," a Ranbaxy spokesman said in an email to Reuters, but the other company involved, Teva, would not comment.
"The settlement is positive for (Ranbaxy). The settlement amount will not significantly impact the company," said Sarabjit Kour Nangra, an analyst at Angel Broking, as quoted by the newswire service.
Ranbaxy was banned from exporting drugs to the U.S. after failing to abide by U.S. Food and Drug Administration manufacturing standards.
Natural News has reported on illegal activity committed by Big Pharma companies often in the past. As our editor, Mike Adams, the Health Ranger, has documented, anyone who has labeled the industry as little more than a criminal enterprise has been vindicated time and again. In 2012, Mike wrote:
Drug and vaccine manufacturer Merck was caught red-handed by two of its own scientists faking vaccine efficacy data by spiking blood samples with animal antibodies. GlaxoSmithKline has just been fined a whopping $3 billion for bribing doctors, lying to the FDA, hiding clinical trial data and fraudulent marketing. Pfizer, meanwhile has been sued by the nation's pharmacy retailers for what is alleged as an "overarching anticompetitive scheme" to keep generic cholesterol drugs off the market and thereby boost its own profits.
This latest settlement with authorities in New York further documents the previous pattern of criminality.