Merck & Co. Inc. and Upsher-Smith Laboratories Inc. have agreed to pay $60.2 million to settle multidistrict litigation (MDL) accusing the companies of a pay-for-delay scheme for the potassium supplement K-Dur. On May 23, U.S. District Judge Stanley B. Chesler gave preliminary approval to the settlement, which was agreed to in February. This comes “after more than 17 years of litigation and four rounds of mediation” over direct purchasers’ claims that the companies had wrongly kept K-Dur’s generic competition off the market. Pursuant to the settlement, the Defendants will pay $60.2 million into an escrow fund for the class members.
The MDL revolves around settlements Merck reached with Upsher-Smith and Baxter International Inc. unit ESI Lederle Inc. in which the generics manufacturers pushed back their release of generic forms of K-Dur 20, which treats potassium deficiencies, including those that stem from taking diuretics to treat high blood pressure. The Plaintiffs, which included drug retailers Walgreen Co., Rite Aid Corp. and CVS Pharmacy Inc., had contended that the drug companies had entered a reverse-payment agreement that delayed the entry of low-cost generic versions of K-Dur 20 until September 2001, keeping the price of the brand-name drug artificially high in violation of the Sherman Act.
The Plaintiffs are represented by Deborah S. Corbishley of Kenny Nachwalter PA, Barry L. Refsin of Hangley Aronchick Segal Pudlin & Schiller, Scott E. Perwin and Lauren C. Ravkind of Kenny Nachwalter PA, Peter Pearlman of Cohn Lifland Pearlman Herrmann & Knopf LLP, David F. Sorensen of Berger & Montague PC and Bruce E. Gerstein, Joseph Opper and Kimberly Hennings of Garwin Gerstein & Fisher LLP. The case is Hip Health Plan, et al. v. Schering-Plough et al., (case number 2:01-cv-01652) and the MDL is In Re: K-Dur Antitrust Litigation (case number 1419). Both of the cases are in the U.S. District Court for the District of New Jersey.