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Pfizer subsidiary Wyeth has agreed to a $39 million settlement in a long-standing antitrust case related to its antidepressant drug Effexor XR. The settlement aims to resolve claims that Wyeth conspired with rival Teva to delay the launch of a cheaper generic version of the drug.
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Background and Settlement Terms
Plaintiffs, including drug purchasers like Rochester Drug Co-Operative and Stephen L. LaFrance Holdings, revealed the proposed settlement terms in a filing in New Jersey federal court. If approved, the settlement would put an end to over 12 years of litigation, with Wyeth denying any violation of antitrust laws. However, the case against Teva will continue despite the settlement with Wyeth.
Response and Implications
Pfizer defended the settlement as fair, reasonable, and the best way to resolve the litigation, while Teva and the plaintiffs’ attorneys remained silent on the matter. The settlement is seen as a way to avoid further litigation costs and risks associated with a trial.
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Allegations and Legal Proceedings
The lawsuit alleged that Wyeth and Teva engaged in anticompetitive behavior, artificially inflating the prices of Effexor XR by delaying the market entry of generic alternatives. Wyeth was accused of making a “reverse payment” to Teva to suppress competition. Although Wyeth initially succeeded in dismissing the claims in 2014, the 3rd U.S. Circuit Court of Appeals reinstated the allegations three years later.
Continuing Actions
While some retailer plaintiffs have settled their individual actions against Wyeth, others like Kroger, Walgreens, CVS, Meijer, and Rite Aid plan to continue litigating their claims against Teva. Attorneys for the direct purchaser plaintiffs seek up to one-third of the settlement fund, amounting to approximately $13 million, in legal fees.
In summary, the settlement marks a significant development in the Effexor XR antitrust case, providing a resolution for Wyeth while the litigation against Teva persists.
Legal Case Details:
In re: Effexor XR Antitrust Litigation, U.S. District Court for the District of New Jersey, No. 3:11-cv-05479-PGS-JBD.
Representation:
For direct purchaser plaintiffs: Thomas Sobol of Hagens Berman Sobol Shapiro; David Sorensen of Berger Montague; Peter Kohn of Faruqi & Faruqi; Barry Taus of Taus, Cebulash & Landau; Dianne Nast of Nastlaw; and Don Barrett of Barrett Law Group.
