Attorney General Mayes Announces $17.85 Million Settlements With Lannett and Bausch Over Conspiracies to Inflate Generic Prescription Drug Prices and Limit Competition, Announces New Complaint Against Novartis and Sandoz

PHOENIX — Today, Attorney General Kris Mayes joined a coalition of 48 states and territories announcing two settlements with Lannett Company, Inc. (“Lannett”) and Bausch Health US, LLC and Bausch Health Americas, Inc. (“Bausch”), totaling $17.85 million to resolve allegations that both companies engaged in widespread, long-running conspiracies to artificially inflate and manipulate prices, reduce competition, and unreasonably restrain trade with regard to numerous generic prescription drugs. 

"Arizonans were unfairly ripped off by these companies and paid illegally-high prices for prescription drugs they relied on to stay healthy. I'm proud to get Arizonans hard-earned money back and hold these pharmaceutical companies accountable for conspiring to raise prices," said Attorney General Mayes. "These types of cases, those that expose the dark underbelly of corporate greed, are the very reason I became Attorney General." 

Also today, 42 states and territories will file new lawsuit against Novartis and its subsidiaries Sandoz Group AG and Sandoz AG alleging a systemic campaign to conspire with other generic manufacturers to fix prices, allocate markets, and rig bids for 31 different generic drugs. The complaint further alleges that Novartis took steps to fraudulently transfer and drain assets from Sandoz, Inc., a defendant in the three previously filed state antitrust complaints, and spin off Sandoz, Inc. to shield Novartis from liability. 

"We're not going to stop going after these greedy corporations who are rigging the system against hardworking Arizonans," said Attorney General Mayes. "There's something particularly sinister about large pharmaceutical manufacturers rigging the system for medicine, which many times consumers have no choice but to continue to purchase. It's gross." 

As part of their settlement agreements, Lannett and Bausch have agreed to cooperate in the ongoing multistate litigations led by Connecticut against 30 corporate defendants and 25 individual executives. Both companies have further agreed to a series of internal reforms to ensure fair competition and compliance with antitrust laws. The Lannett and Bausch settlements follow prior settlements with Apotex and Heritage which totaled $49.1 million. These settlements come as the States prepare for the first trial to be held in Hartford, Connecticut and anticipated to be scheduled in late 2026. 

If you purchased a generic prescription drug manufactured by either Lannett or Bausch between May 2009 and December 2019, you may be eligible for compensation. To determine your eligibility, call 1-866-290-0182 (Toll-Free), email [email protected] or visit www.AGGenericDrugs.com.

Connecticut’s Attorney General Office is leading a coalition of nearly all states and territories in three antitrust cases, starting first in 2016 under the leadership of then-Attorney General George Jepsen. The first Complaint included Heritage and 17 other corporate Defendants, two individual Defendants, and 15 generic drugs. Two former executives from Heritage Pharmaceuticals, Jeffery Glazer and Jason Malek, have since entered into settlement agreements and are cooperating. The second Complaint was filed in 2019 against Teva Pharmaceuticals and 19 of the nation’s largest generic drug manufacturers. The Complaint names 16 individual senior executive Defendants. The third complaint, to be tried first, focuses on 80 topical generic drugs that account for billions of dollars of sales in the United States and names 26 corporate defendants and 10 individual defendants. Seven additional pharmaceutical executives have entered into settlement agreements with the States and have been cooperating to support the States’ claims in all three cases.  

The cases all stem from a series of investigations built on evidence from several cooperating witnesses at the core of the different conspiracies, a massive document database of over 20 million documents, and a phone records database containing millions of call detail records and contact information for over 600 sales and pricing individuals in the generics industry.  Each complaint addresses a different set of drugs and defendants, and lays out an interconnected web of industry executives where these competitors met with each other during industry dinners, "girls nights out", lunches, cocktail parties, golf outings and communicated via frequent telephone calls, emails and text messages that sowed the seeds for their illegal agreements. Throughout the complaints, defendants use terms like "fair share," "playing nice in the sandbox," and "responsible competitor" to describe how they unlawfully discouraged competition, raised prices and enforced an ingrained culture of collusion. Among the records obtained by the States is a two-volume notebook containing the contemporaneous notes of one of the States’ cooperators that memorialized his discussions during phone calls with competitors and internal company meetings over a period of several years.

States and territories settling today with Lannett and Bausch include: Alaska, Arizona, California, Colorado, Connecticut, Delaware, District of Columbia, Florida, Georgia, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota, Northern Mariana Islands, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Utah, U.S. Virgin Islands, Vermont, Virginia, Washington, West Virginia, Wisconsin, Wyoming, and Puerto Rico.

States and territories filing the new complaint against Novartis, Sandoz AG, and Sandoz Group AG include: Alaska, Arizona, California, Connecticut, Colorado, Delaware, District of Columbia, Idaho, Illinois, Indiana, Iowa, Kentucky, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, New  York, North Carolina, North Dakota, Northern Mariana Islands, Ohio, Oklahoma, Oregon, Pennsylvania, Puerto Rico, Rhode Island, South Dakota, Tennessee, Vermont, U.S. Virgin Islands, Virginia, Washington, West Virginia, Wisconsin, and Wyoming. 

A copy of the settlement is below. A copy of the new complaint can also be found below.