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Vyera Daraprim Settlement Overview:
- Why: The deal settles most of the lawsuit brought against the companies and their executives for gouging the price of a life-saving drug and preventing outside access to the drug.
- Who: Vyera Pharmaceuticals LLC and Phoenixus AG reached a $40 million settlement with the Federal Trade Commission and seven states.
- Where: The lawsuit was filed in New York federal court.
Vyera Pharmaceuticals LLC and its parent company, Phoenixus AG, have agreed to a $40 million settlement with the Federal Trade Commission and seven states after the companies and its executives allegedly hiked the price of life-saving drug Daraprim by 4,000 percent back in 2015.
The $40 million will provide relief to consumers who were affected by the substantial price hike, $10 million of which is guaranteed up front. Up to $30 million more is payable over 10 years depending on the companies’ financial condition.
The settlement requires Vyera and Phoenixus to make Daraprim available to any potential generic competitor at list price or the cost of producing the drug. The companies must also provide prior notification of any planned pharmaceutical transaction valued at $25 million or more.
Former Vyera CEO Kevin Mulleady has been banned from “working for, consulting for or controlling a pharmaceutical company” for seven years. Mulleady will pay $250,000 if he violated these terms.
The deal also prohibits Mulleady, Vyera and Phoenixus from engaging in any conduct similar to what was brought forth by the FTC and state plaintiffs in their April 2020 amended complaint.
‘Handsome’ Investment Led to Federal Investigation
The settlement is one result of a January 2020 complaint against Shkreli, Mulleady and the two companies brought forward in federal court by the FTC, New York, California, Illinois, North Carolina, Ohio, Pennsylvania and Virginia.
Vyera’s first CEO, so-called “Pharma Bro” Martin Shkreli, must still stand trial for his role in this case of allegedly masterminding the drug control scheme. Shkreli is currently serving a seven-year prison sentence for an unrelated securities-fraud conviction.
The complaint alleged that the defendants monopolized sales of Daraprim, accusations which Vyera called “meritless.” Daraprim is used to treat toxoplasmosis, a potentially deadly infection for people with HIV, immunocompromised patients and children born to women infected while pregnant.
After the companies acquired exclusive rights to the drug in 2015, the price of Daraprim shot up from $17.50 to $750 per pill.
While Shkreli billed it as a “very handsome investment for all of us” to the company, some patients now faced co-pays as high as $16,000.
Vyera also prevented other companies from creating cheaper generic versions. It blocked others’ access to a key ingredient in Daraprim and to crucial market data, creating a “web of anticompetitive restrictions,” according to court documents.
Were you affected by the Daraprim price hike? You might be eligible for a settlement reward! Tell us about it in the comments below.
The Vyera Daraprim Settlement is Federal Trade Commission, et al. v. Vyera Pharmaceuticals, LLC, et al., Case No. 1:20-cv-00706-DLC, in the US District Court for the Southern District of New York.
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