Allergan Pays $130M to End Drug Price Antitrust Class Action Lawsuit with Investors

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Allergan will pay $130 million to end a class action lawsuit alleging it drove up drug prices by as much as 7,000 percent in an antitrust conspiracy and misled investors about its price-fixing activities.  

Lead plaintiffs, Sjunde AP-Fonden and Union Asset Management Holding AG, filed court documents asking for judicial approval of the proposed settlement agreement Friday. They say that the proposed class action rebates are an “excellent recovery” for Class Members, including those who purchased Allergan stock between Oct. 29, 2013 and Nov. 2, 2016.  

The class action lawsuit was filed in 2016 after Allergan stock prices took a double blow, first when the company was accused of antitrust activity by the U.S. Department of Justice, and again when federal prosecutors considered criminal charges.  

Investors alleged that Allergan failed to come clean about its price-fixing activity, inflating the price of its stock along with generic drugs, according to the allegations.  

“The disclosures of previously misrepresented and concealed material facts about Allergan’s involvement in anti-competitive price collusion caused the price of Allergan’s securities to decline markedly, wiping out billions of dollars in shareholder wealth,” claimed the class action lawsuit.  

The plaintiffs say that the $130 million settlement reached with Allergan is a good result for shareholders. The motion for preliminary approval of the agreement notes that it “the first to be achieved among the federal securities cases arising from the antitrust allegations at issue here, which date back half a decade or more.” 

“It is particularly remarkable in light of the significant challenges that the settlement class would have had to overcome, including the need to prove an antitrust conspiracy — a ‘case within a case,’ with all of the challenges and risks that would entail — in order to prevail on the merits and obtain any recovery for the settlement class,” states the motion.  

The plaintiffs are also seeking certification of their proposed Class.  

Were you affected by Allergan price-fixing? Did you pay higher prices or invest in the company? Tell us about it in the comment section below! 

The plaintiffs are represented by Carella Byrne Cecchi Olstein Brody & Agnello PC; Kessler Topaz Meltzer & Check LLP; and Bernstein Litowitz Berger & Grossmann LLP. 

The Allergan Drug Price Antitrust Lawsuit is In re: Allergan Generic Drug Pricing Securities Litigation, Case No. 2:16-cv-09449, in the U.S. District Court for the District of New Jersey.

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