Teva Pharmaceuticals has ended settlement talks with the U.S. Justice Department in a generic drug antitrust case, betting that the agency won't file criminal charges against the drugmaker in the middle of a pandemic, The New York Times reported.
The Israel-based drugmaker, the largest maker of generic drugs in the world, has been under investigation by the Justice Department and state prosecutors for years over an alleged conspiracy to boost prices of commonly used drugs. Nearly every state attorney general and the Justice Department's antitrust division have called Teva a leading player in the alleged scheme.
The case centers on claims that Teva and a number of rival generic drug companies illegally worked together to increase prices for commonly used generics. Investigators found that Teva dominated the market for some drugs with prices that rose inexplicably and remained high.
The Justice Department has gotten guilty pleas and $224 million in penalties from four other drug companies.
Teva's lawyers were negotiating a settlement with the Justice Department, but ended the talks in mid-April, according to the Times.
Teva reportedly believes the Justice Department won't file criminal charges against it during the pandemic because charges could bankrupt the company and leave it unable to supply drugs to such federal programs as Medicare, according to the Times.
The Justice Department doesn't want to give the impression that it is harming a company helping in the fight against COVID-19, Teva executives told the Times. Teva makes hydroxychloroquine, a drug that was shown in preliminary trials to help COVID-19 patients but that recent studies have found isn't effective against the virus, and has already donated millions of hydroxychloroquine pills to American hospitals, according to the Times.
The statute of limitations on the case ends within the next two weeks, so Justice Department officials have to decide soon whether to file criminal charges. A criminal conviction would ban Teva from selling drugs to federal healthcare programs for at least five years.
In mid-April, Teva's lawyers told the Justice Department they didn't see a point in continuing settlement talks "based on their current trajectory," according to the Times.
A Justice Department lawyer told the Times that while prosecutors didn't want Teva to go bankrupt during the pandemic, they worried about giving the company a free pass for illegal behavior.
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