A UK based producer of opioids, Indivior Plc, is being sued in America by 36 States for alleged anticompetitive behaviour.
The medication they produce – Suboxone – is used to treat addictions to heroine and pain killers, which are reported as growing problems in America, according to news sources.
They are alleged to have blocked access to cheaper alternatives of their medication, forcing users to pay the higher prices they enforce.
Denying consumer choice
The company obtained a US-style “patent” of sorts, known as a an “orphan drug” monopoly, which was allowed by the U.S. Food and Drug Administration given the value of the medication in helping people. They were allowed to recoup their research and development costs for a period of seven years on this basis; but the allegations of wrongdoing are in relation to what happened after this seven-year monopoly honeymoon period had ended.
They are alleged to have denied consumers the choice of cheaper alternatives, which has forced people to buy their product at higher prices, and severely limited options available for treating what are very serious addictions.
Anti-competitive behaviour alleged
The seven-year honeymoon period ran from 2001 to 2008, and it was between 2008 and 2013 that they are being sued for the alleged anti-competitive behaviour.
Amongst the “range of anti-competitive conduct” alleged was changing the medication from pill form to a dissolvable strip form to dupe regulators in to thinking the medication had changed so much that generic versions of it would not be valid, according to the reports (www.bloomberg.com/news/articles/2016-09-22/opioid-treatment-maker-accused-of-illegally-blocking-generics).
They argued to regulators that there were risks to children associated with the pill form, which meant that the dissolvable strip form would be the only achievable remedy. Although these arguments were rejected by the FDA, by the time the generic pill from other companies had hit the market, most users had already been switched to the dissolvable form, and there are currently no cheaper alternatives of the strip form on the market.
The company are said to be robustly defending the law suit.
What happens if they are found guilty?
With reports that they may have been able to make billions through blocking competition, they could be in for some hefty financial sanctions from the U.S. States suing, as well as compensation for customers.
We help victims of UK competition breaches, so we can’t properly advise on how the U.S. system works. We do work with U.S. lawyers in terms of global anti-competitive conduct cases, so we can tell you that the general rules are fairly similar: fines for the firms, and compensation for the victims!