My Oh Mylan: The Price Fix.
ATTORNEYS FROM 33 U.S. STATES and the Federal Trade Commission in July settled in principle a lawsuit for $100 million against pharmaceutical giant Mylan Laboratories and three other defendants for an illegal astronomical price increase for two drugs used to treat Alzheimer's disease and other afflictions.The lawsuits leading to the settlement alleged that Mylan developed a plan late in 1997 to drastically increase prices on two of the 91 generic drugs it manufactured by cutting off its competitors' supply of the drugs' active ingredients. Mylan accomplished this by entering into long-term profit sharing agreements with industry suppliers and distributors that gave Mylan the only reliable sources of the active ingredients.
Having excluded all real and potential competitors, Mylan then promptly increased its prices on the two widely prescribed sedatives by more than 2,500 percent.
In January 1998, Mylan raised the price of clorazepate by 3,218 percent: Clorazepate is a generic version of Abbott Laboratories' Tranxene that is prescribed nearly three million times each year in the United States. The price jump translated to an increase from $22.72 to $754 for a 1,000 tablet supply of the drug.
Two months later, Mylan raised the price of lorazepam, a generic version of Wyeth-Ayerst's Ativan, by 2,679 percent, from $13.60 to $378 for a 1,000 tablet bottle of the drug.
Revenues from sales of lorazepam reportedly rose from $9 million in 1997 to $133 million in 1998.
"What makes this behavior even more unconscionable," says Ohio Attorney General Betty Montgomery, "is that these drugs, especially lorazepam, are anti-anxiety medications frequently prescribed for nursing home and hospice patients, including those suffering from long-term debilitating conditions such as Alzheimer's disease." Ohio took the lead role in the states' litigation.
The $100 million settlement in principle includes both recovery of damages by the states and the forfeiture of ill-gotten profits sought by the Federal Trade Commission.
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| Title Annotation: | Mylan Laboratories Inc. |
|---|---|
| Author: | Mokhibe, Russell |
| Publication: | Multinational Monitor |
| Article Type: | Brief Article |
| Geographic Code: | 1USA |
| Date: | Sep 1, 2000 |
| Words: | 319 |
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