Analysis Group Clients GSK and Teva Win Multiple Class Certification Rulings in Pharmaceutical Suit
March 14, 2023
Analysis Group was retained on behalf of GSK and Teva, defendants in a long-running antitrust lawsuit filed by direct purchasers of Lamictal, an anti-epilepsy drug manufactured by GSK. The direct purchasers alleged that GSK and Teva (the manufacturer of a generic version of Lamictal) entered into a reverse payment settlement that violated antitrust laws and caused the purchasers to pay more for both branded and generic versions of the drug than they otherwise would have. They sought certification as a class in the US District Court for the District of New Jersey.
An Analysis Group team led by Managing Principals Ted Davis, Crystal Pike, and Kenneth Weinstein, as well as Vice President Aaron Kelley, supported academic affiliate James Hughes, who filed an expert report and testified at deposition to rebut the plaintiffs’ expert on class certification issues. Professor Hughes critiqued the opposing expert’s reliance on average prices to establish proof of common injury. He opined instead that it was “not possible, absent individualized inquiry, to determine whether any particular member of the proposed [c]lass suffered injury in the form of higher prices as a result of the alleged anticompetitive conduct.”
While the district court initially certified the class, a panel of the US Court of Appeals for the Third Circuit vacated the certification. Citing Professor Hughes’s report at multiple points, the panel held that the district court had incorrectly assumed “absent a rigorous analysis, that averages are acceptable” for establishing proof of common injury. Such an analysis, the panel added, “was necessary in order to determine whether the Direct Purchasers, in light of the competing expert reports and evidence, could show that common issues predominated.”
The panel remanded the case to the district court to carry out the required “rigorous analysis.” On remand, and referring to Professor Hughes’s submission, the district court denied certification, holding that the plaintiffs “have not shown by a preponderance of the evidence that they can prove antitrust injury through common evidence.” In response, the plaintiffs attempted to certify a narrower class of purchasers. Again, certification was denied, as the district court (once again citing Professor Hughes) held that the new class definition failed to satisfy Rule 23’s numerosity requirement.