Antitrust Law Daily Wrap Up, ANTITRUST—DMass: Direct Purchaser Class Certified to Sue Drug Company for Delaying Generic Entry, (May 2, 2013)

By Jeffrey May, J.D.

The federal district court in Boston has certified a class of direct purchasers of the prescription drug Prograf and its generic equivalent, tacrolimus, to proceed with antitrust claims against Astellas Pharma US, Inc., the maker of Prograf. Although Astellas did not oppose the motion in an effort to streamline pretrial motions practice, the court noted that it performed a rigorous analysis to determine that, under the Federal Rules of Civil Procedure, all of the requirements of Rule 23(a) and at least one of the requirements of Rule 23(b) were met (In Re: Prograf Antitrust Litigation, April 23, 2013, Zobel, R.).

Prograf is a branded prescription immunosuppressant used in organ transplant patients. The direct purchaser plaintiffs include pharmaceutical wholesalers Burlington Drug Company Inc., King Drug Company of Florence, Inc., Louisiana Wholesale Drug Co., Stephen L. LaFrance Holdings, Inc., and Uniondale Chemists, Inc.

The plaintiffs allege that they overpaid for the drugs because Astellas foreclosed generic competition to its branded prescription immunosuppressant Prograf by delaying generic drug market entry. Specifically, they contend that, after another pharmaceutical company sought Food and Drug Administration approval to market and sell generic tacrolimus capsules, Astellas filed an objectively baseless citizen petition with the agency for the purpose of delaying such approval.

These plaintiffs will represent a class of approximate 25 entities that purchased Prograf directly from Astellas between April 8, 2008, and December 31, 2011.

Pursuant to Rule 23(b)(3), the court concluded that common questions of law and fact predominate over questions affecting only individual members. Among the common issues identified by the court were whether Astellas unlawfully maintained monopoly power by delaying generic entry and whether Astellas's conduct caused antitrust injury and, if so, the appropriate measure of damages. According to the court, an economist's declaration supported this finding with respect to class-wide impact and damages.

It was also found that a class action was the best method for resolving the dispute between the direct purchasers and Astellas. There is also a related indirect purchaser class action pending before the court on behalf of consumers.

The case is No. 1:11-md-2242-RWZ.

Attorneys: Thomas M. Sobol (Hagens Berman Sobol Shapiro LLP) for Stephen L. LaFrance Holdings, Inc. Jonathan Gerstein (Garwin Gerstein & Fisher LLP) for Louisiana Wholesale Drug Co. Allison W. Reimann (Sidley Austin LLP) for Defendant Astellas Pharma US, Inc.

Companies: Astellas Pharma US, Inc.; Burlington Drug Company Inc.; King Drug Company of Florence, Inc.; Louisiana Wholesale Drug Co.; Stephen L. LaFrance Holdings, Inc.; Uniondale Chemists, Inc.

Cases: Antitrust MassachusettsNews