Blue Cross and Blue Shield of Minnesota Files Class Action Lawsuit Against Vyera Pharmaceuticals and Phoenixus AG

Complaint Alleges Anticompetitive Conduct to Increase Drug Price by 4,000%

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Blue Cross and Blue Shield of Minnesota

Mar 04, 2021, 10:00 ET

EAGAN, Minn., March 4, 2021 /PRNewswire/ -- Blue Cross and Blue Shield of Minnesota (Blue Cross) is taking legal action against Vyera Pharmaceuticals and its parent company, Phoenixus AG, claiming illegal pricing for the prescription medication Daraprim. The class action lawsuit alleges Vyera intentionally monopolized the pharmaceutical market for Daraprim in order to increase prices by more than 4,000 percent.

The complaint, filed today in U.S. District Court for the Southern District of New York, outlines Blue Cross' claims that Vyera "executed a multifaceted plan to enrich themselves and maintain their monopoly" by preventing generic drug companies from acquiring Daraprim samples and ingredients needed to develop lower-cost alternatives.

Daraprim is the leading treatment for toxoplasmosis, a parasitic infection that can be fatal for those with HIV/AIDS, cancer, or compromised immune systems. Under the ownership of Vyera (formerly Turing Pharmaceuticals) the per-pill price for Daraprim went from $17.50 to $750. Patients typically need to take multiple doses of Daraprim per day, over a course of treatment that can last weeks or months.

In its complaint, Blue Cross claims that Vyera Pharmaceuticals; its parent company, Phoenixus AG; and two former executives, Martin Shkreli and Kevin Mulleady; specifically targeted Daraprim for the price hike due to the relatively small patient population and ability to tightly control who could access the drug. From the time of its purchase of Daraprim rights in 2015 until the first generic option was available in March 2020, Vyera maintained a 100 percent share of the market for pyrimethamine products approved for sale in the United States by the FDA.

"Everyone deserves access to safe, effective, and affordable medication," said Dr. Craig Samitt, president and CEO at Blue Cross and Blue Shield of Minnesota. "This lawsuit is an important step in advancing that goal. Drug companies need to be held accountable for their role in making sure health care costs are sustainable for all."

Blue Cross has filed the suit on behalf of itself and other similar third-party payers under the laws of more than 30 states, Washington D.C. and Puerto Rico. The suit seeks monetary damages based on allegations of market overcharges for Daraprim that were the result of anticompetitive, deceptive and unjust conduct.

Blue Cross is represented in this lawsuit by Robins Kaplan LLP.

To learn more about what Blue Cross is doing to improve the sustainability of health care, visit www.bluecrossmn.com/sustainability.

About Blue Cross and Blue Shield of Minnesota

For nearly 90 years, Blue Cross and Blue Shield of Minnesota (bluecrossmn.com) has supported the health, wellbeing and peace of mind of our members by striving to ensure equitable access to high quality care at an affordable price. We are on a mission to inspire change, transform care and improve health for the people and communities we serve by reinventing both ourselves and the broader system. Our more than 2.5 million members can be found in every Minnesota county, all 50 states and on four continents. As a proud nonprofit organization, we believe working to advance wellness for all Minnesotans is the greatest investment we can make. Our goal is nothing less than for everyone to be able to achieve their full health potential, regardless of race or other socially defined circumstances. Blue Cross and Blue Shield of Minnesota is an independent licensee of the Blue Cross and Blue Shield Association, which serves more than 107 million members across the U.S.

SOURCE Blue Cross and Blue Shield of Minnesota