SCHENECTADY COUNTY — A lawsuit brought by Schenectady County and 13 other New York counties seeking damages from makers of generic prescription drugs was filed last week in Nassau County.
The lawsuit alleges the companies improperly inflated their prices for prescription drugs covered under the counties’ health insurance program, divided markets among themselves, and fixed bids.
In addition to Schenectady County, participating municipalities in the Capital Region include Montgomery and Fulton counties.
The counties, like many other New York counties, pay prescription drug costs themselves rather than buying insurance for them. They lawsuit says that in addition to covering prescription costs for their employees, the counties cover drugs needed at the county jails, in workers’ compensation cases involving county employees, and the county share of Medicaid recipients’ drug prescriptions.
The Schenectady County Legislature in June authorized participation in the proposed lawsuit, which is being brought by a New York City law firm on behalf of a number of counties. Prescription medications cost the county about $6 million per year, county officials said.
“Schenectady County consistently works to protect taxpayer money,” said County Legislature Chairman Anthony Jasenski, D-Rotterdam. “The lawsuit will ensure that the county recoups any moneys improperly paid due to unfair practices by these drug manufacturers.”
In the lawsuit, the drug companies are accused of anti-trust violations and conspiracy to control the prices of such common prescription drugs as statins, ACE inhibitors, beta blockers, antibiotics, anti-depressants, contraceptives, and non-steroidal anti-inflammatory drugs.
The lawsuit does not seek a specific amount of damages or spell out the estimated overcharges each county has experienced.
Schenectady County obtained a $293,908 settlement in a separate case against brand-name drug manufacturers that covered the years between 2008 and 2015.
In addition to Schenectady County, the counties participating in the lawsuit include Nassau, Allegany, Clinton, Cortland, Franklin, Greene, Herkimer, Lewis, Madison, Niagara, and Steuben counties. They name 34 pharmaceutical manufacturers or drug companies as defendants, including such companies as Pfizer and Sandoz. In previous proceedings, the companies have denied the charges.
Officials said there will be no upfront cost to the county, with the law firm receiving a share of any settlement or verdict against drug companies.
The U.S. Department of Justice and many state attorneys general are investigating if generic drug manufacturers are engaged in price-fixing, bid-rigging and other possible anti-trust violations. In May, state attorneys general filed a federal lawsuit in Connecticut against 21 drug companies, involving 116 different generic drugs. New York is one of the states participating in that lawsuit.