Attorney General Hilgers Announces $400 Million Settlement in Principle with Sandoz Over Conspiracy to Inflate Prices and Limit Competition

Lincoln - Attorney General Hilgers today joined a coalition of 43 states and territories announcing a $400 million settlement in principle with Sandoz Inc. to resolve allegations that the generic drug manufacturer engaged in widespread, long-running conspiracies to artificially inflate and manipulate prices, reduce competition, and unreasonably restrain trade with regard to numerous generic prescription drugs. If approved, Sandoz Inc. will pay a total of approximately $469 million to settle the claims brought by state enforcers, including amounts paid pursuant to previous settlements with other states. The settlement will also resolve allegations that Sandoz Inc.’s past and present international affiliates, Novartis AG, Sandoz AG, and Sandoz Group AG, participated in the alleged anticompetitive conduct and fraudulently transferred assets in order to avoid liability. 

As part of the settlement in principle, Sandoz has agreed to a series of internal reforms to ensure fair competition and compliance with antitrust laws. This settlement is contingent upon obtaining signatures from all necessary states and territories and comes as the States prepare for an anticipated trial in 2027. 

The States have also secured settlements in the same litigation with Glenmark, Lannett, Bausch, Apotex and Heritage totaling approximately $96.5 million. 

The cases all stem from a series of investigations built on evidence from several cooperating witnesses at the core of the different conspiracies, a massive document database of over 20 million documents, and a phone records database containing millions of call detail records and contact information for over 600 sales and pricing individuals in the generics industry. Each complaint addresses a different set of drugs and defendants and lays out an interconnected web of competing industry executives that met with each other during industry dinners, "girls’ nights out," lunches, cocktail parties, golf outings, and communicated via frequent telephone calls, emails, and text messages that sowed the seeds for their illegal agreements. Throughout the complaints, defendants use terms like "fair share," "playing nice in the sandbox," and "responsible competitor" to describe how they unlawfully discouraged competition, raised prices and enforced an ingrained culture of collusion. Among the records obtained by the States is a two-volume notebook containing the contemporaneous notes of one of the States’ cooperators that memorialized his discussions during phone calls with competitors and internal company meetings over a period of several years. 

Attorney General Hilgers joined the attorneys general of Alaska, Arizona, California, Colorado, Connecticut, Delaware, the District of Columbia, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota, Northern Mariana Islands, Ohio, Oklahoma, Oregon, Pennsylvania, Puerto Rico, Rhode Island, South Dakota, Tennessee, U.S. Virgin Islands, Vermont, Virginia, Washington, West Virginia, Wisconsin, and Wyoming.