By Nate Raymond
BOSTON, May 18 (Reuters) – A U.S. jury on Monday found Takeda Pharmaceutical liable for causing about $885 million in damages by delaying a generic version of its constipation drug Amitiza through an anticompetitive scheme.
Jurors in federal court in Boston, following a five-week trial, sided with wholesalers, insurers, health funds and retailers including CVS and Walgreens who said the delay forced them to overpay for the drug.
The award could rise to several billion dollars. Federal antitrust law that covers the bulk of the plaintiffs’ claims allows damages to be automatically tripled, meaning $821.7 million of the jury’s award could swell to $2.47 billion.
Japan-based Takeda denied wrongdoing during the trial and said in a statement it will “vigorously pursue” an appeal.
“We also believe that there were both evidentiary and legal errors made during the trial,” the company said. “While we are disappointed with this outcome, we thank the jury for its service.”
The company said it was currently assessing the amount of the provision it must recognize in relation to the litigation and will revise its financial statements for the previous fiscal year that ended in March.
FIRST TRIAL WIN FOR PLAINTIFFS
The lawsuits, filed in 2021, are among a wave of cases targeting so-called “pay-for-delay” deals, in which brand-name drugmakers pay generic rivals to postpone launching cheaper versions of medicines in exchange for resolving patent lawsuits. The U.S. Supreme Court ruled in 2013 such agreements can violate antitrust law.
Monday’s verdict is the first time a jury has found a pharmaceutical company liable in class-action litigation over such pay-for-delay agreements since the Supreme Court’s ruling. Three earlier trials ended in defense verdicts.
“We were incredibly fortunate to have a committed jury that really showed up every day, took their job seriously,” said Kristen Johnson, a lawyer for drug purchasers pursuing class-action claims against Takeda. “They understood that paying off a competitor has real consequences on competition.”
The case centered on Amitiza, a medication developed by Sucampo Pharmaceuticals, which partnered with Takeda to market the drug in the United States after its approval in 2006.
In 2012, Par Pharmaceutical sought FDA approval to bring a generic version of Amitiza to market. Sucampo and Takeda sued for patent infringement, while Par argued that the patents were invalid.
The companies settled in 2014, with Par agreeing to delay launching its generic until January 2021, when it was allowed to sell an authorized version of Amitiza, known as lubiprostone, supplied by Sucampo under a profit-sharing deal.
‘PAYOFF’
Lawyers for the plaintiffs said the settlement amounted to a $210 million “payoff” that delayed generic competition by six years while giving Par a lucrative partnership. Sucampo was later acquired by Mallinckrodt in 2018.
But Joshua Barlow, one of Takeda’s lawyers, told jurors in his closing argument on Thursday the settlement had been lawful and pro-competition, saying that without it, generic Amitiza would not have been available until years later.
“It increased competition,” he said.
Takeda’s license agreement related to Amitiza ended in 2024, and the company no longer sells the drug.
The jury awarded $474.9 million to direct purchasers such as pharmacies and wholesalers, and $63.2 million to insurers and other “end payors.”
It also awarded $346.8 million in damages to five retailers that sued individually, including $191 million to CVS and $121 million to Walgreens.
Jonathan Stratton, a lawyer for the retailers, said in a statement the verdict “makes clear that pharmaceutical companies cannot buy their way out of competition.”
(Reporting by Nate Raymond in Boston; Additional reporting by Kantaro Komiya in Tokyo; Editing by Bill Berkrot, Sanjeev Miglani and Christian Schmollinger)
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