Judge trims case against Viatris, pharmacy benefit managers over EpiPen

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EpiPen auto-injection epinephrine pens manufactured by Mylan NV pharmaceutical company. REUTERS/Jim Bourg

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  • Antitrust, RICO claims by direct purchasers trimmed
  • Ruling comes after related claims by indirect purchasers settle

(Reuters) - Viatris Inc and pharmacy benefit managers Optum RX Inc, CVS Caremark and Express Scripts Inc have gotten much of a lawsuit accusing them of conspiring to drive up the price of the EpiPen anti-allergy auto-injector thrown out.

U.S. District Judge Eric Tostrud in Minnesota ruled on Tuesday that the plaintiffs, drug distributors Rochester Drug Co-Operative Inc and Dakota Drug Inc, failed to make a case that Viatris' predecessor Mylan and the PBMs unreasonably restrained trade in violation of the federal Sherman Act, an antitrust law.

Tostrud said the plaintiffs had not shown that the PBMs ever made any agreement with one another, and that no single PBM had enough market share for its agreement with Mylan to be anticompetitive.

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Viatris said in a statement that it was pleased with the decision and would vigorously defend against the remaining claims.

Lawyers for the plaintiffs and the PBMs could not immediately be reached for comment.

The ruling leaves in place a different Sherman Act claim, accusing the defendants of illegally trying to maintain a monopoly by suppressing competition for the EpiPen, though Tostrud said more evidence is needed to determine whether the plaintiffs waited too long to file it. It also leaves in place parts of a racketeering claim.

The EpiPen, which treats life-threatening allergic reactions, is manufactured by Pfizer Inc but sold by Viatris, which was formed by the merger of Mylan and Pfizer's Upjohn unit. The distributors seek to represent a class of direct purchasers that bought EpiPens from the manufacturer.

The litigation followed public outcry in 2016 after Mylan raised the price of a pair of EpiPens to $600, from $100 in 2008.

PBMs negotiate drug prices with manufacturers on behalf of health plans, and decide what drugs to include in their formularies.

In their 2020 lawsuit, the drug distributors claimed that beginning around 2013, the PBMs abandoned their duty to negotiate on behalf of health plans and instead accepted sharp price increases in exchange for rebates that allowed them to enrich themselves.

Viatris in February settled a similar lawsuit filed by indirect EpiPen purchasers, including consumers and health plans, for $264 million. The settlement came after a district court judge dismissed most of the case, leaving only claims about an allegedly anticompetitive patent settlement.

Pfizer settled related claims for $345 million last July.

The case is In re EpiPen Direct Purchaser Litigation, U.S. District Court for the District of Minnesota, No. 20-cv-00827.

For plaintiffs: Bruce Gerstein of Garwin Gerstein & Fisher

For Viatris: Adam Levin of Hogan Lovells

For Express Scripts: Michael Lyle of Quinn Emanuel Urquhart & Sullivan

For CVS Caremark: Enu Mainigi of Williams & Connolly

For Optum: Brian Boone of Alston & Bird

Read more:

EpiPen antitrust litigation settled; Viatris to pay $264 million

Pfizer agrees to pay $345 mln to resolve EpiPen pricing lawsuit

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Brendan Pierson reports on product liability litigation and on all areas of health care law. He can be reached at brendan.pierson@thomsonreuters.com.