Antitrust Law Daily Wrap Up, ANTITRUST—E.D. Pa.: Generic drug makers fail to exclude Humana economic expert opinion,(Jul. 29, 2026), (Jul 29, 2026)

By Justin Marcus Smith, J.D.

When an expert’s review of the evidentiary record is voluminous, failure to consider contradictory evidence goes to weight.

The opinion of a Humana Inc. economic expert was admissible under Fed. R. Civ. P. 702 for the upcoming trial of Humana direct action plaintiff (DAP) claims, one facet of generic drug pricing multidistrict litigation (MDL), because the expert deployed economic expertise, held the federal district court in Philadelphia. Among other things, the court reasoned the expert (1) conducted a review of the evidentiary record to confirm alignment with his economic understandings; (2) observed that the defendants acted inconsistently with rational self-interest; and (3) provided economic context that would assist the jury. The expert’s review of the fact record was “reliable and fit this case.” Among other stated reasons for denying exclusion of this Humana expert, the court found the use of average sales prices (ASPs) tracked economic literature. An inability to distinguish between defendants weakened the analysis, but aggregate market-wide analysis can assist a jury. A Third Circuit holding that the use of average pricing data requires rigor was tailored to class certification. The expert’s molecule-level analysis was acceptable because some studies about generic drug pricing have used it. Defendants repeated that the expert ignored contrary evidence, but again, the expert conducted a reasonably tailored review of millions of documents. The expert also explained that isolated denials of conspiracy would not have undermined his conclusion that the record was “holistically” indicative of an overarching conspiracy. The court found the expert had a basis for finding oligopolistic pricing inapplicable. After considering the defendant’s manifold objections, the court denied exclusion of this expert (In Re: Generic Pharmaceuticals Pricing Antitrust Litigation, No. 2:18-cv-03299-CMR (E.D. Pa. Jul. 28, 2026)).

Background. In multidistrict litigation (MDL) about alleged price-fixing of generic drugs, the court selected the Humana Inc. v. Actavis Elizabeth, LLC 2018 action (Humana I) as the first bellwether case to involve a direct-action plaintiff (DAP). The Humana bellwether is one of several direct-action cases in the broader generic pricing MDL. The MDL also includes complaints by other purchasers and payors alleging price-fixing claims against many of the same generic drug manufacturers.

Humana alleged that the defendants increased prices on certain generic drugs in violation of the antitrust laws and that those price increases caused Humana financial harm. Humana’s claims involve two distinct streams of commerce: (1) claims as an indirect purchaser based on insurance payments made on behalf of members who submitted claims under their prescription drug coverage; and (2) claims as a direct purchaser or DAP based on the transactions of its Humana Pharmacy, Inc. subsidiary. The subsidiary purportedly bought generics directly from defendants for distribution to plan members on a mail-order and retail pharmacy basis. As previously reported, trial is set to begin on September 14, 2026.

In May, the court denied the defendants’ motion to strike portions of Humana’s rebuttal expert reports, including the rebuttal report of this expert, or to permit additional sur-rebuttal reports. The court held, among other things, that any remaining objections were best left to Daubert motions.

In June 2026, the court heard argument on the defendants’ joint Fed. R. Evid. 702 motion to exclude five Humana experts and Humana’s motion to exclude the opinions and testimony of two defense experts. The court said the parties offered opinions on a range of issues, including collusion, damages, and the functioning of the generic drug market. At the hearing, the parties only presented arguments. They declined to present live testimony.

The defendants noted that the 2023 amendment to R. 702 resulted in two modifications. First, the amendment clarified that courts apply a preponderance of the evidence standard when assessing questions of admissibility under R. 702. Second, the amendment emphasized that an expert opinion must “reflect a reliable application of the principles and methods to the facts of the case.”

At length, the court issued a discrete opinion denying exclusion of a particular Humana expert report by Dr. W. David Bradford, a university professor with “extensive” health economics research experience.

Collusion expert. In November 2025, Humana served an expert report from Bradford purportedly addressing why defendants allegedly increased generic drug prices and the impact of those increases on Humana. The court found Bradford’s analysis had the requisite indicia of reliability and fit.

Bradford performed a multi-part analysis consisting of four steps: (1) a market power study that found the defendants had substantial market power because price hikes enhanced profitability and because their market shares for most subject drugs tended to surpass 75% of the alleged collusion period; (2) a study of price trends that found the magnitude and timing of price increases suggested collusion; (3) a ruling-out of alternative explanations like supply shortages; and (4) a review of the discovery record that purportedly found price upticks were accompanied by conduct consistent with unlawful collusion, like sharing of price information. Bradford also considered factors that “facilitate” collusion, like concentration, and found each satisfied and lent support to an inference of collusion. Bradford concluded the defendants had ability and incentive to act in concert; sharp prices increases were atypical of competition; and that they took actions that would ordinarily be against self-interest. He opined the defendants pricing and sale conduct indicated collusion or agreement, not independent decisions, oligopolistic pricing, or other market factors.

Core objections. The defendants argued Bradford’s analysis was (1) one-sided and did not support two-sided collusion; (2) steps 1 through 3 were methodologically flawed; and (3) discovery review at step 4 was based on a skewed sample and not within expertise. The defendants also complained he used arbitrary start and end dates.

The court did not see Bradford’s reliance on tables and charts that were underinclusive of brand name manufacturers and overinclusive of defendants as a reason to exclude. The criticism was “overstated.” Experts only need to present good grounds for testimony. Bradford premised market power on direct and indirect evidence, profitable sharp price increases and dominant market shares, respectively, as consistent with academic literature. The court suggested reasonable experts could disagree on whether aggregating market shares for all defendants was helpful to the analysis.

The court reached a similar conclusion about Bradford’s price trends analysis at step 2. The defendants objected to the use of market-wide average sales prices (ASPs) and the plotting of prices by molecule rather than form or strength, but the court disagreed. The court found the price-trends technique “testable and well documented in non-judicial fields.” The use of ASPs did not negate that and tracked the literature. A Third Circuit holding that the use of average pricing data requires rigor was tailored to class certification.

The molecule-level analysis was acceptable because some studies about generic drug pricing have used it. Most drugs in the Humana complaint identified the molecules. The jury is the proper arbiter of whether different forms and strengths were not substitutable.

Concerns about Bradford’s step 3 were misplaced. The thrust of the analysis was not that supply shocks did not happen. Rather, it was that they did not explain upheavals in pricing. Most increases allegedly surpassed 300%. The method for ruling-out supply constraints tracked peer-reviewed studies. A preponderance of the evidence showed Bradford’s analysis was reliable.

At step 4, the defendants said Bradford did not use economic expertise and used unreliable and selectively examined evidence, but experts routinely opine about indications of collusion in the form of illegal conspiracy, self-interest, and placing events in economic context. An expert’s examination of the factual record can be broad, as necessary to confirm consistency, but is not admissible if acting in the same role as a lay juror. In the EPPs’ class bellwether, the court found a different experts’ review of depositions, competitor communications, and exchange of confidential information withstood Daubert scrutiny. In DPPs’ class bellwether, the court said it held analogously. The same conclusion about review of the evidence applied here.

Record review was also reliable and fit the case because consideration of non-content phone records and trade show attendance did not taint the expert’s analysis. For example, communications cited clustered around pricing decisions or actions to secure or concede market share. Omission of contradictory evidence was “not so grave” as to render the record review unreliable. When the record is voluminous, as here, involving tens of millions of documents, failure to consider contradictory evidence goes to weight. The court said the expert did search the record for alternative explanations that might contradict an inference of collusion.

The court distinguished the instant matter from another in that the instant defendants discussed contradictions originating from the fact record, not scientific evidence.

Comparative conclusion. As for the expert’s comparative conclusion and whether it was two-sided and detached from an underlying one-sided analysis, such that it was ostensibly “cherry-picked,” the court found the expert offered a basis for distinguishing lawful and unlawful conduct. As already noted, the expert looked at a lot of evidence indicating adoption of “fair share” agreements, price information exchange, market share concessions, and tanked bidding opportunities. The court noted the timing of phone calls also raised an inference of conspiracy. Defendants repeated that the expert ignored contrary evidence, but again, the expert conducted a reasonably tailored review of millions of documents. He also explained that isolated denials of conspiracy would not have undermined his conclusion that the record was “holistically” indicative of overarching conspiracy.

As for oligopolistic pricing, the court found the expert had a basis for distinguishing it. The expert’s rebuttal report explained how purportedly skyrocketing prices and documentary evidence were inconsistent with oligopoly behavior, whether “conscious parallelism” or “price leadership.” Mere opinions are not evidence of conspiracy. The court said the defendants were free to offer their own experts. Their objections went to weight, not Daubert admissibility. Last, the fact that Bradford did not discuss causation raised a merits issue, not a reason for exclusion.

Other arguments. The court said the defendants’ objection to Bradford’s start and end dates for the alleged collusion period seemed to repeat the objection that he improperly used record evidence to inform his opinion. Again, study of defendant interactions was appropriate to confirm assumptions and put events into economic context. The court also did not see how the use of an end date that the defendants first requested made the analysis unreliable.

The court also disagreed with the defendants that Bradford’s opinion was devoid of economic analysis. Bradford adhered to economic principles in analyzing market power, price trends, and supply and demand. He found the generic drug market susceptible to collusion due to high concentration of supply, multimarket contracts, high barriers, product homogeneity, stable inelastic demand, and price transparency. These were clearly economic inquiries. Qualms about their accuracy were for cross-examination.

The court acknowledged that Bradford’s “inability” to distinguish between the defendants in Steps 1 through 3 weakened his testimony, but aggregated, market-wide analyses can assist jurors in assessing the “important economic context” bearing upon Humana’s overarching conspiracy allegations.

The Case is No. 2:18-cv-03299-CMR.

Judge: Rufe, C.

Attorneys: James Caleigh Macdonald (Schneider Wallace Cottrell Kim LLP) for Humana Inc. Sheron Korpus (Kasowitz LLP) for Actavis Elizabeth, LLC, Actavis Holdco US, Inc., Actavis Pharma, Inc. and Akorn, Inc. Donald W. Hawthorne (Carter Ledyard & Milburn LLP) for Breckenridge Pharmaceutical, Inc. Brian T. Feeney (Greenberg Traurig, LLP) for Dr. Reddy's Laboratories, Inc. Dimitra Doufekias (Morrison & Foerster LLP) for Glenmark Pharmaceuticals Inc., USA.

Companies: Humana Inc.; Actavis Elizabeth, LLC; Actavis Holdco US, Inc.; Actavis Pharma, Inc.; Akorn, Inc.; Breckenridge Pharmaceutical, Inc.; Dr. Reddy's Laboratories, Inc.; Glenmark Pharmaceuticals Inc., USA

Cases: Antitrust PennsylvaniaNews