Taro Pharmaceuticals U.S.A. Charged by DOJ in Ongoing Criminal Antitrust Investigation
Posted on 07/23/2020
A number of generic drug companies have been caught conspiring to artificially increase prices over the past few years in the United States. Taro Pharmaceutical Industries is an Israeli research-based pharmaceutical manufacturer publicly listed in the New York Stock Exchange (NYSE). The company’s operations are managed in three sub-companies, including Taro Pharmaceutical Industries Ltd., Taro Pharmaceuticals Inc. and Taro Pharmaceuticals U.S.A., Inc. (Taro U.S.A.). The latter two are its subsidiaries. The U.S. Department of Justice charged Taro U.S.A. for conspiring to fix prices, allocate customers, and rig bids for generic drugs. TARO U.S.A. agreed to a deferred prosecution agreement in which it admitted to participating in two charged conspiracies between 2013 and 2015.
According to the press release, “A two-count felony charge was filed today in the U.S. District Court for the Eastern District of Pennsylvania in Philadelphia, charging Taro U.S.A. with participating in two criminal antitrust conspiracies, each with a competing manufacturer of generic drugs and various executives.
The Antitrust Division also announced a deferred prosecution agreement (DPA) resolving the charges against Taro U.S.A., under which the company agreed to pay a $205,653,218 criminal penalty and admitted that its sales affected by the charged conspiracies was in excess of $500 million. Under the DPA, Taro U.S.A. has agreed to cooperate fully with the Antitrust Division’s ongoing criminal investigation. As part of the agreement, the parties will file a joint motion, which is subject to approval by the Court, to defer for the term of the DPA any prosecution and trial of the charges filed against the defendant.”
The press release adds, “Specifically, Count One charges Taro U.S.A. for its role in a conspiracy with Sandoz Inc., former Taro U.S.A. Vice President of Sales and Marketing Ara Aprahamian, and other individuals, from at least as early as March 2013 and continuing until at least December 2015. Count Two charges Taro U.S.A. for its role in a second conspiracy with a generic drug company based in Pennsylvania and other individuals, from at least as early as May 2013 and continuing until at least December 2015. According to the charge and DPA, Taro U.S.A. and its co-conspirators agreed to fix prices, allocate customers, and rig bids for numerous generic drugs, including medications used to prevent and control seizures and treat bipolar disorder, pain and arthritis, and various skin conditions.”
According to recent filings, Sun Pharmaceutical Industries Limited owns 29,497,813 shares, or 77.1% of Taro Pharmaceutical Industries.