Dec 16, 2018; Vancouver, British Columbia, CAN; Sales representatives of pharmaceutical company Apotex attend an employee meeting at VanDusen Botanical Garden in Vancouver, Canada. Photo taken December 16, 2018. Mandatory Credit: Nick Procaylo-USA TODAY Sports
Apotex Ltd. has paid $100 million to help investigators look into possible price-fixing activity, the U.S. Justice Department says.
The agreement to cooperate — with the potential of U.S. charges — followed an investigation into the Canadian pharmaceutical giant following an antitrust complaint filed in August by the U.S. government.
The DOJ said in a statement on Monday that the investigation will look into whether Apotex illegally re-designated brands of generic drugs to gain entry into the U.S. market by making them more expensive than competing products.
“While Apotex has made substantial payments to bring its generic offerings more in line with those of rival manufacturers, it has avoided paying substantial price discounts to facilitate equal price reductions by its generic competitors,” the Justice Department said.
The company has agreed to investigate competing generic manufacturers and U.S. consumers.
The allegations follow allegations that the company placed supplier orders for a branded generic version of the cardiovascular drug Vascepa after ensuring that brand producers paid higher rates than did Apotex — resulting in higher generic prices.
Apotex’s response to that accusation was that the customers — which included both generic and brand makers — had obtained agreements with Amarin Corp. to sell a generic version of Vascepa for a higher price — creating a sweet-heart deal that let Apotex gain entry to the U.S. market and gain additional sales.
At the time, Apotex said it submitted claims with state Medicaid programs based on higher sales.
While Apotex is an aggressive player in the industry, the small company was one of the first to ramp up the development of the topical business, pioneering topical formulations for personal care products like sunscreens.
The company also helped launch the first brand-name drug based on a specialized gel, launched intramuscular injectable treatments to treat gastrointestinal diseases and launched a popular antibiotic-like drug for chemotherapy-induced nausea.
Apotex was the fourth-largest company in Canada last year, with sales of $2.2 billion, according to data collected by Nielsen. The company is listed on the Toronto Stock Exchange under the symbol ACY.
Apotex’s Canada office could not be reached for comment on Monday.
However, speaking to Reuters earlier this year, Apotex CEO Marcel Coutu denied claims that his company colluded in price-fixing activities to gain a competitive advantage.
“The very first accusation of collusion is absolutely unfounded. It is an outrage,” Coutu told Reuters in August.
Apotex has a strong presence in Canada and operates there through more than 60 affiliated companies.