FTC, N.Y. AG Sue Vyera Pharmaceuticals, Shkreli over Alleged Anticompetitive Scheme

The Federal Trade Commission and New York Attorney General have filed a complaint in federal court against Vyera Pharmaceuticals, imprisoned former executive Martin Shkreli, and another former executives that alleges the company engaged in a scheme to preserve a monopoly for Daraprim, a treatment for the rare and fatal parasitic infection toxoplasmosis.

Toxoplasmosis is usually contained by the immune system and causes no symptoms, according to the complaint. But for people with compromised immune systems, toxoplasmosis can cause deadly infections of the brain and lungs.

The complaint alleges that Daraprim had been an affordable drug for more than 60 years but said that when Vyera acquired the drug it immediately raised the list price to $750 per tablet from $17.50, which significantly impacted access to care.

The suit charges that Vyera prevented competitors from introducing generic alternatives by preventing them from buying samples of Daraprim. Without samples, competitors were unable to conduct the FDA-mandated bioequivalence tests necessary for obtaining approval. The defendants also prevented competitors from accessing a critical ingredient used to manufacture Daraprim.

In addition, the suit charges the defendants signed “data blocking” agreements preventing several distributors from selling Daraprim sales data to third-party data reporting companies. Without such data, generic drugmakers are unable to assess whether a given development project is worth pursuing. With these agreements, the defendants sought to keep potential generic competitors from accurately assessing the market.

The complaint alleges that consumers and other purchasers of Daraprim likely would have saved tens of millions of dollars by purchasing generic versions of Daraprim. Instead, as a result of the defendants’ anticompetitive conduct, there is no generic version on the market today.

Vyera said the claims were “without merit” and said it will “vigorously defend” itself in court.
“The FTC and the NY AG allege in their complaint that certain activities undertaken by Vyera with respect to Daraprim constituted anticompetitive conduct that was unlawful,” the company said. “These allegations are unsupported by the facts and overlooks the realities in the marketplace. Robust competition from other products for the treatment of toxoplasmosis already exists and no action taken by Vyera has prevented additional potential competitors from entering the market.”

An attorney for Shkreli told The New York Times that the suit was “baseless and unprecedented.”

The complaint seeks monetary relief for people who overpaid for the drug, as well as remedial injunctive relief to restore competitive conditions to the market, halt any ongoing anticompetitive conduct, and prevent the defendants from engaging in similar conduct in the future.

Photo: Martin Shkreli, former executive of Vyera Pharmaceuticals

Author: Rare Daily Staff