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Pharmaceutical Antitrust Suit Survives Motion to Dismiss

Recently pharmaceutical company Fresenius Kabi USA LLC ("Fresenius") accused Par Pharmaceutical Companies, Inc. ("Par") of abusing its monopoly on an anti-diuretic drug, which increases blood pressure in patients with vasodilatory shock, by increasing prices and preventing competitors from entering the market, which violates antitrust laws. On February 10, 2017, the U.S. District Court for the District of New Jersey allowed the case to proceed by denying Par's motion to dismiss.

According to Fresenius's allegations, Par controls the entire market on anti-diuretic drugs because it is the only company with the Federal Drug Association's ("FDA") approval to sell intravenous vasopressin injections. These injections contain a man-made form of the polypeptide hormone normally produced by the pituitary gland that constricts blood vessels and retains water. In order to obtain FDA approval, Fresenius would need access to a supplier of the drug's active pharmaceutical ingredient ("API"). However, there are only three API suppliers approved by the FDA and Par leveraged its dominant market position to deny competitors from accessing these suppliers. Consequently, Fresenius alleges that Par anti-competitively increased the price of the drug from $5.13 to $138.60 per vial.

Par argued in its motion to dismiss, that antitrust laws do not protect companies who fail to outbid their competitors for the supplies. Par further argued that competitors could have gone to court in order to gain access to supplies under their own preferred terms.

However, Judge Susan D. Wigenton decided that Fresenius alleged sufficient claims to show Par may have used anti-competitive practices to secure its market advantage in a way that kept its competitors out of the market. In this beginning stage of the case, the Court must assume that Fresenius can prove the alleged facts, and if those facts are shown, then the resulting injury would be covered under antitrust laws.

The legal team at SFMS has significant experience litigating antitrust matters. If you have any questions regarding this subject or this posting, please contact Nick Lussier ([email protected]) or Chiharu Sekino ([email protected]). We can also be reached toll-free at (866) 540-5505.

Shepherd, Finkelman, Miller & Shah, LLP is a law firm with offices in California, Connecticut, Florida, New Jersey, New York, and Pennsylvania. SFMS is an active member of Integrated Advisory Group (www.iaginternational.org), which provides us with the ability to provide our clients with access to excellent legal and accounting resources throughout the globe. For more information about our firm, please visit us at www.sfmslaw.com.

SOURCES

Greene, Kat. "Par Can't Shake Antitrust Suit Over Vasopressin Access," Law360. Last modified on February 10, 2017.

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