A group of potentially thousands of municipalities and pension funds has been granted class-action status in a price-fixing and racketeering lawsuit brought against wholesale pharmaceutical distributor McKesson Corp.
Judge certifies class action against McKesson
U.S. District Judge Patti Saris late Friday certified the class and consolidated complaints from two pending lawsuits in U.S. District Court in Boston into one case. The judge estimated that the class could encompass thousands of self-insured, non-Medicaid public payers that purchased more than 400 brand-name drugs using wholesale price indexes allegedly manipulated by McKesson between 2001 and 2005.
McKesson, San Francisco, which calls itself the largest wholesale pharmaceutical distributor in North America, settled similar allegations in 2009 brought by the New England Carpenters Health Benefits Fund for $350 million. In court records, McKesson has denied the price-fixing and racketeering allegations, including the claims in the carpenters' fund case that it settled out of court.
According to the plaintiffs, McKesson conspired with medical-price publishing firm First DataBank to increase the markup between wholesale and retail drug prices, which allegedly made the drugs more profitable for the retail pharmacies that purchased drugs from McKesson. However, the practice also artificially increased the prices that municipalities paid for drugs, since public entities relied on the retail markup figures to price their drugs.
On Friday, Saris consolidated the complaints brought against McKesson by the San Francisco Health Plan and several municipalities: Douglas County, Kansas; Baltimore; Panama City, Fla.; Anoka County, Minn.; Columbia, S.C.; and Goldsboro, N.C.
McKesson officials said in an e-mailed statement that the company was pleased that Saris' opinion “dramatically reduced the scope” of the proposed class of litigants, claims, and the time period for the alleged activity. “We believe the plaintiffs' claims are without merit and we will vigorously defend ourselves,” the statement said.
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