Glaxo Accused Of Monopolizing Wellbutrin Market
A federal judge has certified a class action antitrust suit that accuses Glaxo of using monopolistic tactics to boost profits of its Wellbutrin antidepressant, by delaying a generic version from coming to market, The Legal Intelligencer reports.
The suit was brought by direct purchasers who claim Glaxo devised a scheme to keep Wellbutrin prices high by making fraudulent assertions to the US Patent and Trademark Office and by engaging in “sham” patent litigation against generic drugmakers, the paper writes.
According to the suit, the plan worked because the patent litigation delayed the market entry of generic versions of Wellbutrin, and the direct purchasers were forced to pay unnecessarily high prices for the drug, because no generic versions of bupropion were available for nearly two years after Glaxo’s patent monopoly would have expired, according to the paper.
In their motion for class certification, the plaintiffs seek to certify the case on behalf of direct purchasers who bought the 100 mg or 150 mg dosage of Wellbutrin directly from Glaxo between January 24, 2002 - the date on which the suit says generic entry would have occurred had Glaxo not engaged in allegedly anticompetitive conduct - and June 30, 2006, the date on which prices allegedly stabilized at competitive levels.
Glaxo lawyers argued in their own brief that when a brand-name drug faces no competition from generic equivalents, it is usually sold to the three major national drug wholesalers who purchase the majority of the product for resale to other parties in the distribution chain, the paper writes.
When a generic drug enters the market, the defense team argued, it generally hurts the national wholesalers because generic manufacturers often sell directly to the other parties in the distribution chain, bypassing the national wholesalers, according to the Intelligencer.
As a result of “generic bypass,” Glaxo lawyers argued, a conflict exists among members of the proposed class of direct purchasers because national wholesalers benefit from anticompetitive activity that prevents generic entry, allowing them to retain higher sales, whereas other direct purchasers are harmed by the same anticompetitive activity in the form of higher prices, the paper writes.
But US District Court Judge Bruce Kauffman found the defense argument was premised on a 2003 decision from the 11th U.S. Circuit Court of Appeals that has been rejected by other courts. The court said the putative class in Valley Drug vs. Geneva Pharmaceuticals, which included the three major national wholesalers and other direct purchasers, likely had differing interests because the national wholesalers may have benefited from the alleged anticompetitive activity, the paper writes.
But Kauffman refused to follow Valley Drug, saying Glaxo’s defense failed to convince him that a true conflict exists in the Wellbutrin purchaser class. “Even assuming that the national wholesalers in this case were harmed by the introduction of generic drugs, generic versions of Wellbutrin…have been on the market since 2004. Therefore, the national wholesalers are no longer reaping the alleged benefits of delayed generic entry, and their interests are not ‘harmed’ by recovery of any illegal overcharge,” Kauffman wrote.
“Indeed, any economic benefits the wholesalers experienced in the past are legally irrelevant because the overcharge itself - not any economic effect of the overcharge - is the proper measure of recovery in this antitrust case,” Kauffman wrote, according to the Intelligencer.
