Settlement Reached in Class Action Against Martin Shkreli and His Former Companies for Allegedly Monopolizing Market for Life-saving Drug Daraprim
January 31, 2022
Minneapolis, MN and New York, NY. (January 31, 2022) —Today, on behalf of Blue Cross and Blue Shield of Minnesota (Blue Cross), Robins Kaplan LLP announced that a settlement has been reached in Blue Cross’s class action lawsuit accusing Martin Shkreli, two of his former companies, and a former executive of illegally monopolizing the market for Daraprim—a once-affordable, life-saving drug, which increased in price by more than 4,000 percent under Shkreli’s leadership.
Daraprim is the gold-standard treatment for toxoplasmosis, a parasitic infection that can be fatal for people with compromised immune systems, like those with HIV/AIDS. Blue Cross claims that Shkreli, his former companies Vyera Pharmaceuticals, Phoenixus AG, and Kevin Mulleady (Vyera’s former CEO) endangered vulnerable patients and overcharged health plans by raising the price of Daraprim from $17.50 to $750 per pill while illegally blocking lower-cost generic versions.
Under the settlement, which was submitted for the court’s approval on Friday, Vyera and Phoenixus must abandon their allegedly anticompetitive practices and pay up to $28 million to a proposed class of third-party payers that purchased Daraprim. The settlement also requires Shkreli to abide by the injunctive relief entered against him in a related lawsuit brought by the Federal Trade Commission and several states, where the court recently ordered Shkreli to be banned from the pharmaceutical industry for life.
“We are pleased to be on the path towards compensating class members who we allege were harmed by the defendants’ scheme,” says Kellie Lerner, co-chair of the Robins Kaplan Antitrust and Trade Regulation Group. “We hope this settlement sends a clear message that private payers will fight against unconscionable price increases.”
“Blue Cross and Blue Shield of Minnesota believes that drug companies need to be held accountable for the uncontrollable rise of prescription drug costs,” said Dana Erickson, president and CEO at Blue Cross and Blue Shield of Minnesota. “We look forward to finalizing this settlement in the courts so that funds may be distributed appropriately to impacted members of the class.”
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For nearly 90 years, Blue Cross and Blue Shield of Minnesota (bluecrossmn.com) has supported the health, wellbeing and peace of mind of our members by striving to ensure equitable access to high quality care at an affordable price. We are on a mission to inspire change, transform care and improve health for the people and communities we serve by reinventing both ourselves and the broader system. Our more than 2.5 million members can be found in every Minnesota county, all 50 states and on four continents. As a proud nonprofit organization, we believe working to advance wellness for all Minnesotans is the greatest investment we can make. Our goal is nothing less than for everyone to be able to achieve their full health potential, regardless of race or other socially defined circumstances. Blue Cross and Blue Shield of Minnesota is an independent licensee of the Blue Cross and Blue Shield Association, which serves more than 107 million members across the U.S.
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