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STATES SETTLE ANTITRUST SUIT AGAINST SANDOZ DRUG COMPANY TO PAY $16.5 MILLION IN DAMAGES AND COSTS

 STATES SETTLE ANTITRUST SUIT AGAINST SANDOZ
 DRUG COMPANY TO PAY $16.5 MILLION IN DAMAGES AND COSTS
 RALEIGH, N.C., Sept. 3 /PRNewswire/ -- North Carolina Attorney General Lacy Thornburg today announced that the attorneys general of all states and the District of Columbia have reached agreement with Sandoz Pharmaceuticals Corporation and the Caremark, Inc. subsidiary of Baxter International to settle the states' antitrust lawsuit over Sandoz's marketing of the antischizophrenia drug, Clozaril.
 Under the terms of the settlement, which is subject to court approval, Sandoz and Caremark will pay purchasers of the prescription drug, including state agencies, $16.5 million.
 According to the states' complaint filed in December 1990, Sandoz would not permit any person to buy the drug unless he also paid an exorbitant price for non-drug services performed exclusively by Caremark. In June, 1991, Sandoz and Caremark ended their exclusive arrangement.
 As part of the settlement, Sandoz and Caremark have agreed to a court order which forbids them from requiring consumers to purchase services from Caremark as a condition of obtaining the drug.
 Under the monetary provisions of the agreement, Sandoz and Caremark will return $38.92 out of the original $172 that a purchaser paid for each week the Caremark services were required under the illegal agreement. This means that reimbursement for one person's use of Clozaril for the entire 15 months of the illegal agreement would be approximately $2,500.
 Thornburg said that between one-half and two-thirds of all purchases were made by state governments, either under their Medicaid programs or for patients in state hospitals. Thornburg estimated the benefit to North Carolina will be about $285,000, with about $164,000 going directly to state agencies that have paid for Clozaril, and $17,500 to Thornburg's office to reimburse it for its attorneys' fees in bringing the action.
 Thornburg said, "The settlement is significant for North Carolina's recovery of the bulk of the overcharge, as well as for the message it sends to the pharmaceutical industry: We will not tolerate this type of coercion in the marketplace."
 An eight-state subcommittee of the National Association of Attorneys General Antitrust Task Force, led by the Minnesota Antitrust Division, began a national investigation into Clozaril distribution in April 1990. The states filed suit in December 1990 in the United States District Court for the Southern District of New York in Manhattan.
 The suit was eventually moved to the Northern District of Illinois in Chicago, where the settlement will be reviewed by United States District Court Judge Harry D. Leinenweber. The states today took the first step in obtaining court approval by filing a Motion for Preliminary Approval.
 Sandoz Pharmaceuticals, the U.S. subsidiary of Sandoz, Ltd. of Basle, Switzerland, is located at 59 Route 10, East Hanover, New Jersey. Caremark, Inc. is located at 455 Kingsbridge Parkway, Lincolnshire, Illinois.
 -0- 9/3/92
 /CONTACT: Kip Sturgis, Assistant Attorney General, 919-733-7741/ CO: State of North Carolina Department of Justice; Sandoz
 Pharmaceuticals Corporation; Caremark, Inc. ST: North Carolina, New Jersey, Illinois IN: MTC SU:


SB -- CH007 -- 6445 09/03/92 12:59 EDT
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Publication:PR Newswire
Date:Sep 3, 1992
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