Teva Pharmaceutical Industries Ltd.
- Company Name
- Teva Pharmaceutical Industries Ltd.
- Stock Symbol
- Class Period
- August 4, 2017 to May 10, 2019
- Motion Deadline
- August 23, 2019
- Eastern District of Pennsylvania
The complaint charges Teva and certain of its officers with violations of the Securities Exchange Act of 1934. Teva is the world’s largest generic drug manufacturer.
Since at least 2014, there has been intense public scrutiny into the rising prices of generic drugs, including Congressional hearings, calls for drug pricing legislation, and prosecutorial investigations. The first such investigation was initiated by the Attorney General (“AG”) of Connecticut in July 2014. Shortly thereafter, the U.S. States Congress and U.S. Department of Justice launched probes into the skyrocketing prices of generic drugs. Since that time, Teva has been the subject of intense scrutiny concerning its alleged involvement in an industry-wide price-fixing scheme and other collusive misconduct in the U.S. generic drug market.
The complaint alleges that throughout the Class Period, contrary to defendants’ denials that Teva had “engaged in any conduct that would give rise to liability” in various antitrust proceedings and investigations, Teva had in fact engaged in a vast, industry-wide price-fixing scheme and other collusive misconduct since at least 2012; Teva was not only a participant, but the company at the heart of the anticompetitive scheme; and several Teva employees were so deeply involved in the scheme that they would ultimately be named as defendants in a sweeping civil enforcement action filed by the AGs of virtually every state in the nation. As a result of defendants’ repeated denial of and failure to disclose the truth regarding these allegations, the price of Teva American Depositary Shares (“ADSs”) was artificially inflated to more than $31 per share during the Class Period.
On December 9, 2018, it was publicly disclosed that the scope of the State AGs’ investigation had expanded greatly to include 300 drugs and at least 16 companies, exposing “the largest cartel in the history of the United States.” On this news, the price of Teva ADSs fell $0.97 per shares, or 5%, to close at $18.44 per share on December 10, 2018.
Then on May 10, 2019, a coalition of 44 states filed a 524-page antitrust complaint revealing previously undisclosed facts regarding Teva’s participation in the generic drug price-fixing conspiracy. Among other things, the action detailed Teva’s role as a “consistent participant” in the conspiracy, implementing price increases on upwards of 110 generic drugs and colluding with competitors regarding over 85 different generic drugs. On this news, the price of Teva ADSs fell $2.13 per share, or approximately 15%, to close at $12.23 per share on May 13, 2019.