Barry Sherman’s Apotex has paid $100 million to answer U.S. price-fixing allegations and agreed to help investigate competitors.
Sherman and his partner Eugene Shapiro, Apotex’s president and chief operating officer, each paid $75 million and will pay an additional $15 million penalty if the U.S. government comes back with further allegations of wrongdoing, the company said Monday.
Apotex announced the settlement without admitting to any wrongdoing. It said it still intends to vigorously defend itself against the allegations, which involved excessive price-fixing of at least one generic drug over a seven-year period between 2009 and 2014.
Drug prices are an important issue in the United States, where President Donald Trump has repeatedly berated makers of cheaper generic medicines. Some state attorneys general have launched investigations into drug companies, including Allergan, Bristol-Myers Squibb, Merck, Pfizer and Express Scripts.
“Although the size of the monetary penalty is of no concern to us, it is gratifying that we have been able to resolve our actions in a constructive manner and set an important precedent for upholding drug company standards of integrity,” Amit Kapur, vice president and chief legal officer at Apotex, said in a statement.
Drug companies across the country are competing to make the world’s cheapest copy of a medicine. One version of a cancer drug costs $100,000 a year, but another generic drug could be considerably cheaper and reach the marketplace for as little as $2,000.
Both Levamin and gevokizumab, two cancer drugs made by Allergan, are in high demand because their potency is better than that of other cancer drugs. American patients and insurers have grown accustomed to finding out about generic versions of drugs within weeks or months of a patent expiring. They find out about the new generic products long before competitors enter the market to sell branded medicines.
But some wonder if companies are setting artificially high prices to cover the costs of a generic medicine’s research and development, or corporate profits. U.S. drug prices soared by 14% last year — after being unchanged for the previous four years.