Two subsidiaries of pharmaceutical giant Johnson & Johnson have reached a $65 million settlement agreement to resolve allegations that they artificially inflated prices for a heart medication by preventing generic alternatives from reaching the market.
The proposed settlement between Actelion Pharmaceuticals and Janssen Research & Development was submitted Wednesday to a federal court in Maryland, though it still requires judicial approval to move forward.
Health insurance plans, including the Government Employees Health Association and other organizations that covered Tracleer prescriptions for their members, filed the lawsuit claiming the drug manufacturers intentionally stalled generic competition for the medication.
Tracleer serves as an oral therapy for pulmonary artery hypertension, generating billions in revenue for Actelion before Johnson & Johnson acquired the company in 2017. Janssen operates as another division within the Johnson & Johnson corporate structure.
Company representatives have not yet provided a response to requests for comment regarding the settlement.
Sharon Robertson, representing the plaintiffs as lead counsel, stated the agreement will deliver “meaningful relief” to the group of third-party insurance providers who purchased both brand-name Tracleer and its generic equivalent across nearly ten years.
While agreeing to the financial settlement, the defendant companies have maintained their innocence and rejected any admission of wrongdoing. The original legal challenge was initiated in 2018.
According to the lawsuit, the pharmaceutical companies prevented competitors from obtaining necessary Tracleer samples, which “effectively blocked competitors from bringing a competing generic product to market for a period of time.”
The settlement encompasses Tracleer transactions across 31 states, Washington D.C., and Puerto Rico spanning from December 2015 through September 2024.
Legal representatives for the plaintiffs indicated they will request approximately one-third of the total settlement amount, roughly $21 million, to cover attorney fees and litigation costs.
The legal case is formally titled Government Employees Health Association v. Actelion Pharmaceuticals Ltd et al, filed in the U.S. District Court for the District of Maryland under case number 1:18-cv-03560-GLR.
