Nationwide Classes OK’d In Wholesale Pricing Case

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wholesaleA federal judge in Boston has certified two nationwide classes and set the stage for two more trials in the multidistrict wholesale drug pricing case against AstraZeneca and Bristol-Myers Squibb, The National Law Journal notes.

The case alleges they published fraudulently inflated average wholesale drug prices, which led consumers and insurers to overpay for branded and generic drugs used to treat serious illnesses like cancer and HIV. In a September 26 order, US District Judge Patti Saris ruled there would be a trial for each of the two classes and each class period would range from January 1, 1991, to January 1, 2005.

The first class includes third-party payors who made reimbursements for Medicare Part B covered drugs based on average wholesale prices. The second class includes consumer or third-party payors who paid for certain physician-administered drugs made by AstraZeneca or Bristol-Myers. The second class also includes all third-party payors whose reimbursements contracts were based on the published wholesale prices.

“This hard-fought, costly multi-district litigation involves a highly complex system for reimbursement for drugs and some of the finest lawyers in the country,” Saris wrote in the 105-page ruling. “As a result of presiding over the MDL, this Court has experience with these Kafka-esque and opaque drug pricing issues that few other courts currently do.” Here is the ruling.

“Instead of a class confined to one state or jurisdiction, we can now address the problem on a national level,” Steve Berman, a plaintiff’s attorney, tells the paper.

An AstraZeneca spokeswoman says the drugmaker “competed responsibly” and acted legally when pricing and marketing its drugs. “We believe the lawsuit has no merit and that the certification of a nationwide class is improper, particularly in light of the numerous differences in consumer protection laws from state to state,” she tells the Journal.

A Bristol-Myers spokeswoman says the drugmaker is disappointed that the court certified the multistate class action. “BMS continues to believe that it acted appropriately,” she tells the paper. “We are exploring whether to seek an appeal of the class certification ruling.”

Several parts of the case have gone to trial or settled. Following a trial last November, Saris ordered AstraZeneca and Bristol-Myers to pay nearly $14 million to insurers and consumers in Massachusetts (read here).

In March, 11 drugmakers and their subsidiaries settled claims against them for $125 million (back story). The agreement followed AstraZeneca’s May 2007 settlement of claims brought by Medicare Part B Zoladex users for $24 million and Glaxo’s $70 million settlement in August 2006.

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