Class Actions -- 2019



Ahold, U.S.A. v. Warner Chilcott PLC   (1st Circuit)

Antitrust liability for branded pharmaceutical manufacturers

The NAM filed an amicus brief to argue against overbroad antitrust liability for pharmaceutical manufacturers that settle patent infringement litigation with potential generic competitors. A group of plaintiffs brought a class action lawsuit against the manufacturer of a branded contraceptive pill, arguing that a litigation settlement agreement between the branded manufacturer and a potential generic competitor delayed market entry for the generic product and artificially maintained prices for the branded product. Only 26 wholesalers purchased the branded product. Courts generally require at least 40 plaintiffs to meet the numerosity requirement of class certification. The plaintiffs’ counsel sought to expand the size of the plaintiff class by including wholesale purchasers of other generic contraceptive pills made by another manufacturer. They argued that under the “umbrella theory” of antitrust injury, antitrust violators who limit output thereby bring about higher market prices for related products. By this logic, the group of potential plaintiffs increased from 26 to 47. A federal district court accepted that reasoning and certified the class action. The defendants sought immediate review from the U.S. Court of Appeals for the First Circuit. The NAM’s amicus brief in support of review explains why the umbrella theory of antitrust injury is invalid and identifies the harms to manufacturers if such a theory is upheld. On December 17, 2019, the parties filed a notice of settlement with the court.


Related Documents:
NAM brief  (July 23, 2019)