U.S. News

Two HIV/AIDS Patients File Federal Antitrust Suit Against Abbott Over Price of Norvir; May Seek Class-Action Status

April 20, 2004

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Two HIV/AIDS patients on Monday in the U.S. District Court for Northern California filed a federal antitrust lawsuit against Abbott Laboratories claiming that the pharmaceutical company illegally "jack[ed] up the price" of its antiretroviral drug Norvir by 400%, Reuters reports (Reuters, 4/19). In December 2003, Abbott increased from $54 per month to $265 per month the per-patient wholesale price of Norvir, which is known generically as ritonavir. Norvir is used primarily as a booster for other protease inhibitors, such as Bristol-Myers Squibb's Reyataz and Merck's Crixivan. On Feb. 6, Illinois Attorney General Lisa Madigan (D) announced that her office had opened an investigation into whether the price increase of Norvir was designed to increase the price of antiretroviral drug combinations that use Norvir as a booster and steer patients toward Abbott's newer antiretroviral drug Kaletra. Kaletra, which does not need a booster because it includes ritonavir, costs about $18.78 per patient per day, or $563.40 per patient per month, and has a longer patent life (Kaiser Daily HIV/AIDS Report, 4/14). In addition, the AIDS Healthcare Foundation last month filed suit against Abbott claiming that the drug maker used false advertising to say that state Medicaid programs would not be affected by the price increase. The AHF suit, filed in Los Angeles Superior Court, alleges that Abbott falsely stated the impact the price increase could have on California's Medicaid program. AHF in February also filed a federal antitrust suit against Abbott, seeking unspecified damages and a court order establishing a price for Norvir that is within "reasonable financial reach of the HIV-infected public." AHF -- which operates seven pharmacies and several clinics in the United States, Africa and Central America -- is one of the country's largest purchasers of antiretrovirals (Kaiser Daily HIV/AIDS Report, 3/19).

Lawsuit Details, Reaction
According to Joseph Tabacco, a lawyer representing the patients, the lawsuit could be the first Norvir suit seeking class-action status, Reuters reports. In order to establish class-action status, the court must determine that the plaintiffs are "similar enough to represent a class," according to Reuters (Reuters, 4/19). Lawyers representing the patients say that by increasing the price of Norvir -- which adds thousands of dollars a year to the cost of its competitors' regimens that use the drug as a booster -- Abbott is attempting to direct patients and physicians to use Kaletra, the San Jose Mercury News reports. Tabacco said, "It is one thing for a pharmaceutical company to make money, but Abbott's unjustified price increase has taken unfair advantage of the very people it should be trying to help" (Krieger, San Jose Mercury News, 4/20). He added, "What makes this particularly outrageous is that Abbott depended on U.S. government grants to develop Norvir. Even without the price hike, the company was on track to generate total sales of more than $3 billion on the drug -- 180 times its original investment" (Berman, DeValerio, Pease, Tabacco, Burt & Pucillo release, 4/19). Abbott spokesperson Jennifer Smother said, "The lawsuit is completely without merit. Abbott will defend against the allegations and continue working to deliver cost-effective medicines for people with HIV." Martin Delaney of the San Francisco-based AIDS advocacy group Project Inform said, "It's become a rallying cry over drug pricing. In the long haul, it creates anti-competitive pressure and continues the process of prices going up and up and up" (San Jose Mercury News, 4/20).

A group of protestors on Monday began a 34-hour vigil in front of an Abbott location in South Pasadena, Calif., Reuters reports (Reuters, 4/19). Participants in the vigil include representatives from AHF, the Southern California HIV Advocacy Coalition, Bienestar, Whittier Rio Hondo AIDS Project and other AIDS advocates and patients. The vigil also is being supported by the Organization of HIV Healthcare Providers (AHF release, 4/19). Participants in the vigil carried signs reading, "Abbott Labs: 'Getting Fat on AIDS,'" according to Reuters (Reuters, 4/19).

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