By Brendan Pierson
(Reuters) – Swiss drugmaker Novartis AG has agreed to pay $30 million to settle claims by health plans and consumers that it schemed to delay the U.S. launch of generic competition for its Exforge hypertension drug.
In a motion filed in Manhattan federal court Wednesday, lawyers for the plaintiffs said the proposed deal was fair and “provides immediate, certain, and meaningful relief” while avoiding “enormously expensive” litigation.
Novartis did not immediately respond to a request for comment.
The deal is part of a broader $245 million settlement to end the entire litigation, including claims by drug wholesalers and retailers, which Novartis announced in December. The drugmaker at the time did not say how the money would be broken down.
In December, it sought court approval for a $127 million settlement with so-called direct purchasers, such as drug wholesalers. It has not yet sought approval of an agreement with the retailers, which include CVS Health Corp and Walgreens Boots Alliance Inc.
U.S. District Judge Alvin Hellerstein must approve all of the settlements.
The class-action litigation stemmed from a 2011 licensing agreement between Novartis and Endo International Plc’s Par Pharmaceutical unit.
Plaintiffs accused Novartis and Par of entering an illegal “reverse payment” agreement to delay launches of less expensive, generic versions of Exforge, which treats hypertension to lower blood pressure and reduce the risk of strokes.
Plaintiffs said Par agreed not to launch an Exforge generic for two years after the expiration of one of Novartis’s patents, and Novartis agreed not to compete with Par by launching its own Exforge generic during the 180-day exclusivity period following Par’s entry into the market.
Novartis’s annual U.S. sales of brand-name Exforge exceeded $400 million before generic versions were sold, court papers show.
Endo filed for bankruptcy last year.
The case is In re Novartis and Par Antitrust Litigation, U.S. District Court, Southern District of New York, No. 18-04361.
For Novartis: Evan Chesler of Cravath, Swaine & Moore
For plaintiffs: Robin van der Meulen of DiCello Levitt
Novartis to pay $245 mln to end antitrust cases over Exforge drug generics
(Reporting By Brendan Pierson in New York)