Summary
The United States District Court for the Eastern District of Pennsylvania addresses eleven motions by Epic Pharma LLC to dismiss amended complaints alleging anticompetitive conduct involving the pricing and distribution of Ursodiol. The court concludes that eight complaints plausibly allege Epic's participation in a conspiracy with Lannett and Actavis, while three complaints fail to plead specific conspiratorial conduct by Epic. The court denies the motions as to eight actions and grants them as to the HCSC, Molina, and CVS actions.
Topics
Practice areas
Questions Presented
- Whether eight amended complaints plausibly alleged that Epic conspired with Lannett and Actavis to raise and control the price of Ursodiol.
- Whether the HCSC, Molina, and CVS amended complaints plausibly alleged that Epic participated in an anticompetitive conspiracy involving Ursodiol.
- Whether the state-law claims could survive when they were derivative of the federal antitrust allegations.
- Whether plaintiffs could rely on allegations across separate complaints collectively to establish claims against Epic.
Holdings
- The eight complaints plausibly alleged that Epic conspired with Lannett and Actavis to raise and control the price of Ursodiol and therefore stated actionable federal and derivative state-law claims against Epic.
- The HCSC, Molina, and CVS complaints failed to plausibly allege that Epic participated in an anticompetitive conspiracy concerning Ursodiol and were dismissed under Rule 12(b)(6).
- Each complaint had to stand or fall on its own; plaintiffs could not cure deficiencies in one complaint by aggregating allegations from the other complaints.
- Because the state-law claims rose or fell on the sufficiency of the federal antitrust allegations, the state-law claims survived in the eight complaints with sufficient federal allegations and failed in the three complaints that inadequately pleaded Epic's participation.
Key quotations
“Each complaint stands or falls on its own.” (Section III.A)
“The temporal proximity of these meetings to Epic and Actavis’ increases, as well as Lannett’s inception of Ursodiol sales at a similar price to theirs, is a satisfactory description of a traditional conspiracy.” (Section III.B)
“The complaints must raise a reasonable expectation that discovery will reveal the existence of an illegal agreement.” (Section III.C)
Factual background
The complaints alleged that generic-drug manufacturers and distributors conspired to allocate markets and fix prices for generic pharmaceuticals, including Ursodiol. Eight complaints alleged that Lannett entered the Ursodiol market at $5.11 per 300-mg unit on May 1, 2014, Epic increased its price from $0.45 to $5.10 six days later, and Actavis increased its price from $0.77 to $5.11 on June 24, 2014. Those complaints also alleged communications among Epic, Lannett, and Actavis and purchases of Ursodiol from Epic or its alleged co-conspirators. Three other complaints alleged only generalized price increases, corporate information, trade-association activity, or broad conspiracy allegations without identifying a specific actionable act by Epic concerning Ursodiol.
Procedural history
The actions were pending in the Generic Pharmaceuticals Pricing Antitrust MDL in the Eastern District of Pennsylvania. Plaintiffs filed or amended individual and other non-class complaints against Epic and other generic-drug manufacturers and distributors. Epic moved to dismiss each complaint for failure to state a claim, and the court resolved the motions in this memorandum opinion and order.