BATON ROUGE (CN) - A federal class action accuses the maker of a popular pain medication of paying a $100 million bribe to another drug company to delay the release of its generic tablets.
Blue Cross Blue Shield of Louisiana Endo Health Solutions, its subsidiaries and Impact Laboratories Inc. individually and on behalf of a purported class consisting of anyone who bought Opana tablets after June 2010.
The insurance company says Impax took more than $112 million in cash from Endo to keep its generic, extended-release oxymorphone hydrochloride out of the market from June 2010 to January 2013.
Endo sells oxymorphone hydrochloride as Opana ER. It used the two and a half year delay to develop a new "crush resistant" formulation of Opana, Blue Cross Blue Shield claims.
The anticompetitive scheme by Endo and Impax caused consumers and insurance companies to overpay, the lawsuit alleges.
"Endo essentially bribed Impax to stay out of the market for two and a half years to protect Endo's stream of monopoly profits," the complaint states. "Endo literally bought itself freedom from generic competition. Endo and Impax - competitors - conspired to allocate the market for Opana ER and its generic equivalents in a manner that gave each company more exclusivity than it was entitled to in order to maximize profits at the expense of purchasers of Opana ER."
The scheme began when Endo sued a group of generic manufacturers, including Impax, that wanted to sell generic extended-release oxymorphone hydrochloride. Endo alleged patent infringement. Simply filing the lawsuit stopped the FDA from approving the pill makers' generic drug applications, Blue Cross Blue Shield claims.
Next, after ending its suit against Impax, Endo entered into an "exclusion payment agreement" with the generic manufacturer. The agreement included a $102 million payment to Impax in April 2013 and a second payment of "$10 million up front with an obligation to pay an additional $30 million under the guise of a development and co-promotion agreement for Impax's yet-to-be approved product to treat Parkinson's disease," according to the complaint.
If not for the plan with Endo, Impax would have released its generic version of Opana more than four years ago, when it received FDA approval for most strength levels of the pill, the lawsuit alleges, and Blue Cross Blue Shield says that would have saved it and others money.
"As a direct and proximate result of defendants' illegal conduct, plaintiff and the class members were compelled to pay, and did pay, artificially inflated prices for Opana ER and its generic equivalents," the complaint states.
Blue Cross Blue Shield is represented by Douglas Plymale of the Dugan Law Firm in New Orleans.
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