It was only a year ago when Turing Pharmaceuticals purchased the manufacturing license for a certain drug that is a vital medicine for many patients. The CEO of the company, Martin Shkreli, attracted a massive wave of criticism when he revealed his plans regarding the new asset. At his influence, Daraprim, an antiparasitic drug, received a price tag of $34,000 per vial, which was a raise of 85,000% percentage from its previous price of $40. Beside antitrust violations, the company made sure no other manufacturer could enter the market with a competitive product.
This week, the lawsuit against the Irish drug maker has finally come to a close after a year of activity. Martin Shkreli agreed to a new settlement that obliges him to honor a $100 million fine. The payment will cover charges of antitrust violations as well as the anti-competitive nature of their business format. Martin Shkreli negotiated and agreed to these terms with three state attorney generals and the Federal Trade Commission.
The main complaint of FTC was that Questcor, a subsidiary of the Mallinckrodt company, purchased the U.S. rights for a competing drug in 2014. The product in question is the Synachen Depot from Novartis. The FTC found this move as fraudulent. The acquisition was deliberately initiated so that the company assured for itself the monopoly on the market. By owning the rights over all existent formulas, no other organization was able to come up with a version of synthetic ACTH drug.
After the Synachen Depot acquisition, Questcor continued its antitrust violations by raising the price for Achtar. This drug is a vital medicine first and foremost for infants that develop spasms. Moreover, the same drug is crucial in treatments for other serious conditions. What used to be a common and affordable treatment became an expensive and hard to get solution.
Besides the $100 million fine, Questcor has to obey other court stipulations. The company has to deliver the rights over the Synacthen Depot drug to another party that the commission will choose. This way, the market will escape monopoly, and Questcor will have to develop its activity under competitive terms. The paid fee will be split between the states of New York, Alaska, Washington, Maryland, and Texas. There will be an additional payment of $2 million that will cover the expenses made by attorneys.
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