Friday, May 09, 2008

Class of Direct Purchasers of Antidepressant Drug Certified in Monopoly Case

This posting was written by Jeffrey May, Editor of CCH Trade Regulation Reporter.

The federal district court in Philadelphia has certified a class comprised of approximately 100 direct purchasers of the branded antidepressant Wellbutrin SR to pursue monopoly claims against the drug's maker—GlaxoSmithKline—for delaying the entry of generic competition.

The class contended that GlaxoSmithKline engaged in monopolization through fraudulent assertions to the U.S. Patent and Trademark Office and the filing of frivolous patent infringement actions against generic-drug manufacturers seeking to market less expensive version of the drug. The class sought to recover the overcharges resulting from the challenged conduct.

Class Requirements

The court ruled that the class met the requirements of Federal Rules of Civil Procedure 23(a) and 23(b)(3). Rejected was the drug maker's argument that a conflict existed between the national wholesalers and other class members because the national wholesalers benefited from anticompetitive activity that prevented entry of generic drugs into the market.

Regardless of whether some class members profited from the alleged activity, the controlling question was whether the class members suffered an overcharge. If an overcharge occurred, all class members were entitled to recover, whether or not some plaintiffs experienced a net benefit while others experienced a net loss.

Rule 23(b)(3) required that the questions of law or fact common to class members predominate over any questions affecting only individual members, and that a class action is superior to other available methods for fairly and efficiently adjudicating the controversy.

The direct purchaser plaintiffs maintained that the impact of the alleged conduct could be established by common proof and methodology based on publicly available data as well as information obtained through discovery. They presented a colorable method for establishing common impact, thereby satisfying the predominance inquiry as to class wide impact.

Moreover, the superiority requirement was met because denying certification would require each direct purchaser to file suit individually at the expense of judicial economy and litigation costs for each party and would create a risk of inconsistent results for the defendant and for all direct purchasers.

Assignment of Claims

Certification was not denied, even though the named plaintiffs were assignees of direct purchasers. Antitrust claims could be assigned, and the drug maker's challenge to the validity of an assignment did not require the rejection of one of the class representatives. The merits of the defense would not distract the particular named plaintiff to the detriment of the class itself, according to the court.

The May 2, 2008, decision in In re Wellbutrin SR Antitrust Litigation, Civ. Action No. 04-5525, will appear at 2008-1 CCH Trade Cases ¶76,140.

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