Court Issues Ruling On Defendants’ Motions to Dismiss in Nexium Antitrust Litigation

September 12th, 2013

On September 11, 2013, the United States District Court for the District of Massachusetts, the Honorable William G. Young presiding, issued a decision denying several motions to dismiss brought by various generic drug manufactures in a case involving AstraZeneca’s drug for heartburn, which is sold under the brand name Nexium. SFMS is co-counsel with several other law firms in this case, that together represent a group of health and welfare benefit funds (“End-Payor Plaintiffs”) against drug manufactures, including AstraZeneca AB, Ranbaxy Inc., Teva Pharmaceuticals Industries Ltd. and Dr. Reddy’s Laboratories, Ltd. (collectively, “Defendants”). Plaintiffs allege that Defendants violated state and federal antitrust laws by delaying the entry of generic Nexium to the market by entering into anticompetitive agreements to keep generic Nexium off the market. As a result, Plaintiffs allege that they and consumers were damaged, as they were forced to pay high prices for brand name Nexium. Defendants brought motions to dismiss on the basis that, among other things, the challenged agreements between AstraZeneca AB and various Defendants are immune from antitrust scrutiny; certain claims are time-barred under state and federal statutes of limitations; the End-Payor Plaintiffs lack standing under Article III and Federal Rule of Civil Procedure 23 to bring their claims; and the End-Payor Plaintiffs’ claims brought under the antitrust laws and various consumer protection statutes of various states are deficient. On April 18, 2013, after argument, the Court denied Defendants’ motions to dismiss, but asked for further briefing on the issues raised by Defendants with respect to the End-Payor Plaintiffs’ standing and claims under federal and state law. In response to the additional briefing submitted by the parties, on September 11, 2013, the Court issued an opinion which denied Defendants’ motions to dismiss with respect to claims challenging the harm from reverse payment agreements, thus finding that End-Payor Plaintiffs adequately alleged that AstraZeneca and Defendants entered into these agreements to prevent generic Nexium from coming to market. The Court did limit End-Payor Plaintiffs’ claims by only allowing the End-Payor Plaintiffs to challenge the reverse payment agreements in three states which have a six-year statute of limitations. The Court also allowed Plaintiffs’ claims to proceed which relate to continuing harms suffered as a result of the reverse payment agreements.