Target, American Airlines Say Generic Drugmakers Fixed Prices

American Airlines Group Inc. and Target Corp. are among employers suing generic drugmakers over claims they fixed the price of medications, leading to higher costs for consumers.

The suit, filed Thursday in US District Court for the Eastern District of Pennsylvania, claims dozens of pharmaceutical manufacturers including Actavis Pharma Inc., Amneal Pharmaceuticals Inc., Glenmark Pharmaceuticals Inc., and Teva Pharmaceuticals Inc. entered into illegal agreements that led to “staggering” price increases for critical drugs.

The complaint’s allegations stem from information made public in state and federal government investigations involving the pharma companies, and documents filed in pending multidistrict litigation in Pennsylvania, the complaint states.

The company plaintiffs, which also include General Motors Co. and Lowe’s Cos. Inc., provide health benefits to their employees and their dependents, and therefore pay for some of the costs of medications. The suit adds to a string of litigation facing drug manufacturers over claims they reduced or eliminated competition for particular drugs.

Prices for generic drugs typically fall as new entrants compete for share, presenting a cheaper option for consumers than brand-name counterparts. But the “defendants have deprived the public of the benefit of that bargain by entering into a series of illegal ‘fair share’ agreements to allocate customers and markets, engage in bid rigging, and fix the prices of hundreds of pharmaceutical products,” the complaint states.

“These agreements, which are illegal per se under federal and state antitrust laws, led to staggering price increases for critical medications and forced consumers and their health plans to shoulder the cost of Defendants’ illegal activities.”

The plaintiffs are represented by Bartlit Beck LLP.

The case is American Airlines v. Actavis Holdco US Inc., E.D. Pa., No. 2:24-cv-01430, 4/4/24.