Bristol-Myers Squibb settles antitrust class action for $10M

Bristol-Myers Squibb has settled for $10 million an antitrust class action accusing it and alleged co-conspirators Gilead and Janssen of blocking generic versions of their HIV drugs, according to a court filing.

The agreement includes no finding of fault by the company.

As part of the deal filed on Thursday for preliminary approval, BMS agreed to waive a no-generics restraint in its contract with Gilead for Evotaz, an HIV drug. It resolves claims brought by end payers such as third-party insurers.

"The settlement agreement provides to plaintiffs most of everything they could realistically get from BMS in this litigation," wrote plaintiffs' attorney Steve D. Shadowen, a partner at Hilliard Shadowen LLP. "It does so with decisive structural relief and with a cash recovery that is immediate and certain."

Although they will not seek fees from the $10 million fund, attorneys representing pension funds leading the case seek $2.5 million for litigation expenses. They said they have incurred more than $3.3 million in such expenses.

BMS said in a statement it's "proud to have developed innovative, lifesaving. fixed-dose medicines for the treatment of HIV."

"While we believe the plaintiffs' claims are without merit, we are pleased to put this matter behind us so that we can continue to focus our resources on advancing more scientific innovations for patients in areas of significant unmet need," the statement said.

The complaint accused Gilead of using its monopoly on a critical ingredient in HIV drugs to suppress generic competition and keep prices inflated. The company was accused of conspiring with BMS and Janssen in an agreement to only use patent-protected components rather than lower priced generics.

The class action alleged Gilead orchestrated a plan to monopolize HIV cocktail medications and a no-generics restraint on a number of drugs, including BMS HIV drugs Evotaz and Atripla.

Claims that BMS participated in a Gilead monopolization plan have been dismissed. Plaintiffs' attorneys agreed not to appeal the ruling from U.S. District Judge Edward M. Chen, who's overseeing the litigation, as part of the deal.

"There was no guarantee that a jury would have found in favor of the classes against BMS or that plaintiffs would obtain appellate reversal of the court's dismissal of claims against BMS," Shadowen wrote in a motion for preliminary approval of the agreement.

Under the settlement, $5 million will be divided among the third-party purchaser class and $2.5 million will be divided among consumers who bought BMS HIV drugs.

BMS is represented by Arnold & Porter Kaye Scholer LLP.

Hagens Berman Sobol Shapiro LLP and Durie Tangri LLP also represent plaintiffs in the lawsuit. Attorneys at the firms did not respond to requests for comment.

Plaintiffs' attorneys emphasized the substantial injunctive relief. They wrote the settlement "terminates a restraint that began having its principal anticompetitive bite in December 2017 and that would otherwise exist until at least September 2029."

Several class actions have been filed against the companies, alleging anti-competitive practices in violation of federal and state antitrust laws and state consumer protection laws. Staley v. Gilead Sciences, Inc. et al., CV19-02573 (N.D. Cal., filed May 14, 2019).