New York Joins $100 Million Nationwide Monopoly Settlement In Principle With Anxiety Drug Maker
State Attorney General Spitzer today announced that New York, 32 other states and the Federal Trade Commission ("F.T.C.") have reached a settlement in principle with Mylan Laboratories, in the amount of $100 million, for illegally monopolizing the markets and significantly increasing the prices of two anti-anxiety drugs -- lorazepam and clorazepate1.
"Our investigation showed that Mylan's conduct significantly harmed consumers" Spitzer said. "What makes this behavior even more unconscionable is that these drugs are frequently prescribed to nursing home and hospice patients, and those suffering from long-debilitating conditions including Alzheimer's disease."
The agreement reached will settle the 1998 case filed in federal court by 33 State Attorneys General and the F.T.C. which alleged that Mylan entered into long-term and exclusive price-sharing agreements with pharmaceutical ingredient supplier Profarmaco S.r.l (a wholly owned subsidiary of Cambrex Corporation) and its U.S. distributor Gyma, in late 1997. These agreements excluded all of Mylan's competitors from the only reliable sources to produce the anti-anxiety drugs lorazepam and clorazepate.
Mylan promptly increased the prices for lorazepam and clorazepate by as much as 3000-percent. The price jump translated to an increase from $22.72 to $754 for a 1,000-tablet supply of clorazepate. Two months later, Mylan raised the price for lorazepam from $13.68 to $378 for a 1,000-tablet supply, which is a 2000-percent increase.
The agreement in principle has been approved by Mylan's Board of Directors. A final agreement on the terms of the settlement must be executed before the settlement funds can be disbursed.
The case is being handled by Assistant Attorneys General John A. Ioannou, Robert L. Hubbard and Gary P. Weinstein in the Anti-Trust Bureau, which is headed by Bureau Chief Harry First.