Courtney Jorstad  |  June 16, 2015

Category: Consumer News

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Nexium class action settlementA $24 million class action settlement deal between Teva Pharmaceutical Industries Ltd. and plaintiffs, who accused Teva and generic drug companies of engaging in a pay-for-delay deal to keep generic versions of the heartburn drug Nexium off the market, was given preliminary approval by a Massachusetts federal judge.

U.S. District Judge William G. Young granted preliminary approval to the class action settlement reached with Teva and both end-payers and direct purchasers of Nexium, made by AstraZeneca PLC in two separate orders. This class action settlement resolves antitrust conspiracy charges against Teva.

According to the terms of the Nexium class action lawsuit, $24 million will be put into a fund by Teva. From there, it will be dispersed to the direct purchasers’ and end-payers’ class.

Under the deal, after legal costs, taxes and the $1 million for the indirect purchasers was accounted for, 61 percent of the settlement fund would go to to the direct purchasers and 39 percent would go to the direct buyers, or retailers.

According to the motions for preliminary approval, the attorneys would only get enough money to reimburse their costs, not attorneys’ fees.

In December 2013, the Massachusetts federal court approved a class, which included any person or business “who purchased Nexium directly from AstraZeneca at any time during the period from Aug. 27, 2008 through Dec. 11, 2013.”

“The court finds that the settlement is within the range of reasonableness and warrants preliminary approval,” Judge Young said in both orders.

The hearing for final approval is scheduled for Sept. 29. Judge Young also ordered that a separate unrelated class action lawsuit against Teva filed by end-payers and direct purchasers also be placed on hold for the time being.

The plaintiffs allege that AstraZeneca, Ranbaxy Inc., and Teva engaged in an “overarching conspiracy to delay the introduction of generic versions of the prescription drug Nexium (delayed-release esomeprazole magnesium).”

The plaintiffs allege that the federal antitrust laws were broken when AstraZeneca paid Teva to not sell a generic version of the acid reflux drug. They also allege Ranbaxy and Dr. Reddy’s Laboratories were part of the broader conspiracy to put off an introduction of generic Nexium.

Dr. Reddy’s was removed from the class action lawsuit in October 2014, after it agreed to help the drug buyers at the trial against the three remaining defendants. Dr. Reddy did not pay anything to the classes to be removed as a defendant.

A trial did proceed against Ranbaxy, in which the jury said that the agreement between AstraZeneca and Ranbaxy did not harm competition.

It was the first trial of its kind since the Supreme Court had ruled in 2013 that patent agreements could be the subject of antitrust litigation.

The plaintiffs in that class action lawsuit want a new trial and have filed documents with the court that reportedly shows that a new trial is warranted.

The judge said in January that the pay-for-delay class action lawsuit would go to trial on March 3, if a settlement wasn’t reached. This Nexium class action settlement deal was first disclosed in April.

The direct purchaser plaintiffs are represented by Thomas M. Sobol, David S. Nalven, Donna M. Evans and Kristen A. Johnson of Hagens Berman Sobol Shapiro LLP, David F. Sorensen, Daniel Simons, Ellen Noteware, Caitlin G. Coslett and Nicholas Urban of Berger & Montague PC, Bruce E. Gerstein, Joseph Opper, Elena Chan and Ephraim R. Gerstein ofGarwin Gerstein & Fisher LLP,

The end-payors are represented by Glen DeValerio of Berman DeValerio, Steve D. Shadowen and Anne Fornecker of Hilliard & Shadowen LLC, Kenneth A. Wexler, Bethany R. Turke and Justin N. Boley of Wexler Wallace LLP, J. Douglas Richards and Sharon K. Robertson of Cohen Milstein Sellers & Toll PLLC, and Jayne A. Goldstein of Pomerantz LLP.

The individual plaintiffs are represented by Richard A. Arnold, Scott E. Perwin, Lauren C. Ravkind and Anna T. Neill of Kenny Nachwalter PA, Barry L. Refsin and Monica L. Rebuck of Hangley Aronchick Segal Pudlin & Schiller, and Bernard D. Marcus, Moira Cain-Mannix, Brian C. Hill and Erin Gibson Allen of Marcus & Shapira LLP.

Teva is represented by Laurence A. Schoen and Adam L. Sisitsky of Mintz Levin Cohn Ferris Glovsky and Popeo PC and Jay P. Lefkowitz, Karen N. Walker, Kevin T. Van Wart and Jonathan D. Janow of Kirkland & Ellis LLP.

The Nexium Antitrust Class Action Lawsuit is In re: Nexium (Esomeprazole Magnesium) Antitrust Litigation, Case No. 1:12-md-02409, in the U.S. District Court for the District of Massachusetts.

UPDATE: A settlement has been reached to resolve a portion of this Nexium antitrust class action lawsuit. Details on the deal can be found here. 

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12 thoughts on$24M Class Action Settlement Reached with Teva Over Nexium Pay-for-Delay

  1. Hakeem pittman says:

    My wife passed away 5 months ago. She had Kidney failure and renal failure. She was on stage four renal failure stage 4 she’s been taking a drug for years. I’m raising 3 kids on my own now. I need help and more information about the class action lawsuit.

  2. Elezabeth Cameron says:

    Been on the drug for years a really long time in lieu of surgery. I may now have Kidney issues because of the prolonged use!

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