About 88 percent of the medications sold in the United States are generics and often chosen because they are cheaper, but the United States government has spent two years investigating the actions of more than a dozen drug makers pricing of at least two dozen drugs and is suggesting some may have worked together illegally to increase prices. File photo by John Angelillo/UPI |
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WASHINGTON, Nov. 3 (UPI) -- The U.S. Department of Justice has set its sites on the generic drug industry, issuing subpoenas to several companies and individuals on suspicion the companies have worked together in recent years to drive up prices.
A two-year-old investigation into collusion between generic drug companies, which now covers more than a dozen companies and two dozen drugs, may be on the verge of charging executives or fining companies for working together to increase the prices of generic drugs.
Drug prices are well-known to be astronomically high in the United States compared to other countries, and recent controversies surrounding Martin Shkreli's jacking-up of the price of a decades-old antiparasitic drug and the huge increase in the cost of EpiPens in recent years have caused people to wonder if the medical industry is ripping them off.
It's not illegal for companies to increase their prices at the same time, but it is illegal for competing companies to coordinate on increasing or lowering prices, or on other business practices that affect prices, because it rigs the marketplace.
The Department of Justice and most of the companies have refused to comment on the investigation, but it is known the inquest has touched companies including Teva Pharmaceutical Industries, Mylan NV, Dr. Reddy's Laboratories, Taro Pharmaceuticals, Endo International and Actavis. Actavis was recently sold to Teva by Allergan, which experts hold up as an example of companies joining to further reduce competition in the industry and which may potentially be bad for consumers.
The look specifically at generic drug prices was emphasized by a Government Accountability Office report earlier this year that found 300 of 1,441 generic drugs it looked at had at least one large price increase of 100 percent or more in the last five years.
