Two Drug Companies Will Pay $200 Million — They’re Accused of Working Together to Overcharge You for Generic Medications

Sun Pharmaceutical Industries and its subsidiary Taro Pharmaceutical have agreed to pay $200 million to settle a federal class action accusing them of conspiring with other generic drug companies to keep the prices of common medications higher than they should have been.

The case is part of a larger federal multi-district investigation that has targeted dozens of generic drug manufacturers. The central allegation: companies that were supposed to be competing against each other to lower prices were instead quietly coordinating to make sure prices stayed artificially high.

How Generic Drug Price-Fixing Works

Generic drugs exist specifically because patents on brand-name medications eventually expire. Once the patent is gone, multiple companies can make the same drug and compete on price — which is supposed to make medications dramatically cheaper for consumers and insurance plans.

But the lawsuit alleges that instead of competing, certain drug companies were talking to each other and agreeing to hold prices steady. The result was that consumers and businesses that paid for these generic medications — out of pocket, through a high-deductible plan, or through a self-funded employer plan — paid far more than the free market should have required.

What Medications Were Allegedly Involved

The broader multi-district investigation covers dozens of widely-used generic medications. The types of drugs alleged to be part of the conspiracy include common treatments for:

• High blood pressure
• High cholesterol
• Diabetes
• Bacterial infections (antibiotics)
• Skin conditions (topical creams and ointments)
• Other common chronic conditions

Many of these are everyday medications that millions of Americans take each month. You did not need to buy a rare or expensive specialty drug to be affected — the alleged price-fixing involved the kind of prescriptions people pick up at the pharmacy every month.

Who May Qualify

You may be entitled to a share of this settlement if:

• You purchased generic prescription medications directly — meaning you paid out of pocket, through a high-deductible health plan, or through another arrangement where you bore the cost
• Your purchases occurred during the alleged price-fixing period, roughly 2009 through 2020
• You are a consumer or business (not a reseller or insurer) who paid for these drugs

You do not need to know the specific drug names or recall your pharmacy receipts to check your eligibility. Submit your information now and a representative can help determine whether you’re included in the class.