Two drug companies have agreed to pay $80 million to settle allegations that they conspired to keep a cheaper, generic version of a blood pressure medication off the market.
Under the settlement announced today, Aventis Pharmaceuticals Inc. and Andrx Corp. will pay that amount to states, insurance companies and consumers nationwide.
Consumers paid too much for the drugs Cardizem CD and its generic equivalents because the companies conspired to delay the marketing of cheaper competitors, said New York state Attorney General Eliot L. Spitzer.
Spitzer said that in 1998, the German pharmaceutical giant Hoechst -- which merged with Rhone-Poulenc in 1999 to form Aventis -- paid Andrx just under $100 million to not market a generic form of Cardizem CD for 11 months. The agreement was to be renewed annually, he said.
This "most craven form of anti-competitive behavior" kept the drug financially out of the reach of countless people, Spitzer said.
The lawsuit was filed in 1998, said Spitzer spokesman Darren Dopp. The companies did not acknowledge any guilt in the settlement, he said.
Andrx said in a statement that it believed its actions were lawful but that "this settlement was preferable to the uncertainties and distractions inherent in continued litigation of this matter."
A spokeswoman for Aventis didn't immediately respond to requests for comment.
The average consumer will be eligible to recover 20 percent of what he or she spent on the drug over 14 months in 1998-99 -- as much as several hundred dollars, said Spitzer, who handled the case with state officials in Michigan with assistance from officials in 27 other states.
About $21 million of the settlement will go to consumers in every state, Puerto Rico and the District of Columbia; $30 million will go to insurance companies and other third-party payers; and $4.5 million will go to the states. The remainder -- more than $24 million -- will pay administrative and legal costs.
In 2001 the two companies agreed to pay $110 million to settle similar charges in a federal suit filed by consumer groups.
Consumer groups have said that Cardizem sales total about $700 million a year domestically. Users of Cardizem were paying about $73 a month for the drug when a generic cost about $32 a month.