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Frequently Asked Questions
Basic Information Lawsuits have been filed against several drug companies. The Court has said that the lawsuits can go forward as class actions on behalf of consumers and TPPs who paid or reimbursed for one or more of the Covered Drugs, which are listed in Appendix I at the end of the Notice. You received the Notice because you are a TPP that may have made reimbursements for Covered Drugs between January 1, 1991 and January 1, 2005 or between January 1, 1991 and January 30, 2006. If so, these lawsuits may affect you. Each TPP Class Member has legal rights and choices to make before the Court holds a series of trials to decide whether the claims being made with respect to the drug companies are true. The Court has not yet decided who is right in this litigation. At this time the court has certified that a series of trials and hearings will determine the claims in these lawsuits. An initial trial including all of the Defendants will begin in November 2006. Each TPP Class Member must make a choice whether to remain in the Classes before October 1, 2006. The Notice explains:
2. What are these lawsuits about? Plaintiffs allege Defendant drug companies either report the average wholesale price (“AWP”) of each drug they make to trade publications or provide those publications with information from which the publications calculate an AWP for each of Defendants’ drugs. The published AWP of a drug may be used to set the price that consumers making co-payments, Medicare and insurance companies will pay for the drug. The lawsuits claim that Medicare, private insurers, and consumers paid more than they should have paid for the Covered Drugs because drug companies intentionally reported false and inflated AWPs on these drugs. The Court in charge of the lawsuits is the United States District Court for the District of Massachusetts. The litigation is called In re: Pharmaceutical Industry Average Wholesale Price Litigation, Docket No. 01-CV-12257-PBS. The people who sued are called the Plaintiffs. The drug companies they sued are called the Defendants. The lawsuits include 42 Defendants. The Defendants deny the allegations in the lawsuits.The Court has not yet decided who is right in this litigation. At this time the court has certified that a series of trials and hearings will determine the claims in these lawsuits. An initial trial including all of the Defendants listed below will begin in November 2006:
Whenever you see the word “Defendants” in this Notice, it includes only the companies listed above: AstraZeneca, Bristol-Myers Squibb Group, Johnson & Johnson Group and the Schering Plough Group.
3. Why are these class actions? In a class action lawsuit, one or more people or entities called “class representatives” sue on behalf of others who have similar claims. The people and entities together are a “class” or “class members.” The Court must determine if it will allow the lawsuit to proceed as a class action. If it does, a trial of the claims then decides the lawsuit for everyone in the class. The Court in these lawsuits decided they could be class actions.
4. Who qualifies as a Third-Party Payor? A TPP is an entity that is: (a) A party to a contract, issuer of a policy, or sponsor of a plan, and (b) At risk, under such contract, policy, or plan, to pay or reimburse all or part of the cost of prescription drugs dispensed to covered natural persons. TPPs include insurance companies, union health and welfare benefit plans and self-insured employers. Entities with self-funded plans that contract with a health insurance company or other entity to serve as a third-party claims administrator to administer their prescription drug benefits can qualify as TPPs. Third-party claim administrators may also file a claim on behalf of a self-funded plan if the third-party claim administrator has legal authority and authorization from the self-funded plan to do so.
The Claims in these Lawsuits 5. What do the Plaintiffs claim? The Plaintiffs claim that the Defendants violated various state consumer protection laws because they intentionally provided false and inflated AWPs on certain types of outpatient drugs, including the Covered Drugs. The lawsuits also claim that the Defendants intentionally reported inflated AWPs with the knowledge that Medicare Part B and private insurers rely on reported AWPs to determine the prices they will reimburse doctors for those drugs. The lawsuits say that as a result of the inflated AWPs, TPPs who reimburse part or all of their insured’s co-payment under Medicare Part B or who used AWP as a pricing standard for reimbursement for those drugs outside of Medicare Part B, reimbursed more than they should have. The lawsuits ask the Court to award money damages to those TPPs.
6. What do the Defendants say about the claims? The Defendants deny the factual allegations being made; contend that the lawsuits and damages are precluded under the law; contend that the alleged conduct, if proved, does not violate the Massachusetts consumer protection law, and that many class members will not be able to establish elements of that law, or prove they paid payments for the subject drugs. In addition, Bristol-Myers Squibb points out that it does not report AWPs; it reports list prices at which a substantial percentage of its sales are made. The Johnson & Johnson Group says that Plaintiffs did not calculate Johnson & Johnson’s drug prices correctly and, when these errors are corrected, it is obvious that the published prices for Johnson & Johnson drugs were not inflated. The Johnson & Johnson Group points out that it did not give doctors discounts on the drug Remicade, and the small discounts it gave to doctors on the drug Procrit were disclosed. The Johnson & Johnson Group says its drugs are less expensive than competing therapies, so Class Members who reimbursed for Johnson & Johnson’s products saved money. The Schering Plough Group notes that the prices they report comport with standard industry practice.
7. Has the Court decided who is right in the lawsuits? No. The Court hasn’t decided who is right in these lawsuits yet. Much more must occur before the Court holds a trial, including notifying Class Members. By deciding now that these lawsuits can continue as a class action, the Court isn’t saying who will win.
8. Are there any benefits or money available now? No money or benefits are available now because the Court hasn’t decided whether the Defendants did anything wrong. There could be money or benefits in the future if one or more Defendants settle before a trial, or if the Court decides in favor of the Classes after a trial. There’s no guarantee that any money for Class Members will ever be obtained from the Defendants.
The Classes 9. How many Classes are there? The Court has ruled that there are two different Classes for TPPs who reimbursed for Covered Drugs: a MediGap TPP Class, and a Private Payor TPP Class. A TPP could be a member of one or both Classes.
A TPP is a member of the MediGap TPP Class if it made reimbursements for all or part of its insured’s 20% co-payment under Medicare Part B for Covered Drugs anytime between January 1, 1991 and January 1, 2005 or A TPP is a member of the Private Payor TPP Class if it reimbursed for Covered Drugs outside of Medicare Part B based on a contract that uses AWP as a reimbursement benchmark anytime between January 1, 1991 and January 1, 2006. In order to be member of either the MediGap TPP Class or the Private Payor TPP Class, the reimbursements must have been for a beneficiary in Massachusetts or the Third Party Payor must have its principal place of business in Massachusetts.
11. What are the Covered Drugs? The Covered Drugs are: Albuterol Sulfate, Blenoxane (bleomycin sulfate), Cytoxan (cyclophosphamide), Etopophos (etoposide phosphate), Intron A (interferon alpha), Paraplatin (carboplatin), Perphenazine, Procrit (epoetin alfa), Proventil (albuterol sulfate), Remicade (infliximab), Rubex (doxorubicin hcl), Taxol (paclitaxel), Temodar (temozolomide) VePesid (etoposide) and Zoladex (goserelin acetate) You can find a complete list of the Covered Drugs, by Defendant drug manufacturer, drug name, and NDC code, in Appendix I to the Notice, click here to view the list in PDF format or click here to download the list in an Excel spreadsheet.
12. What does it mean if I’m a member of either or both of the Classes? If a TPP is a member of either of the Classes listed in Question 9 and does not exclude itself, it won’t be able to sue the Defendants again for the claims in these lawsuits if the Court, after a trial, decides Defendants did nothing wrong. But if there is an award of money after a trial or a settlement with any of the remaining Defendants, a TPP that does not exclude itself will be able to make a claim for a share of that money.
Your Rights As A Member Of The Classes 13. How do I remain in either or both of the Classes? A TPP is automatically a member of either or both of the Classes if it fits the Class Definitions as outlined in Question 10. At this time, a TPP does not have to do anything to remain in either or both of the Classes. Each TPP will be notified if there is a settlement with any of the Defendants or if the Court determines that any of the Defendants are liable for damages as a result of the trials.
14. Can I get out of these lawsuits and the Classes? If a TPP is a member of either or both of the Classes, and it wants to keep the right to sue Defendants AstraZeneca, Bristol-Myers Squibb Group, Johnson & Johnson Group, or Schering Plough Group about the same claims on its own (and at its own expense), it must take steps to get out of the either or both of the Classes. This is called excluding yourself.
15. How does a TPP exclude itself from either or both of the Classes? To exclude itself from either or both of the Classes, a TPP must send a letter signed by an authorized representative that includes all of the following:
All exclusion letters must be mailed first class, received by October 1, 2006, to:
Please remember that a Class Member can’t exclude itself by phone or by sending an email.
16. What happens if a TPP excludes itself, can it get any money or benefits from these lawsuits? If a TPP excludes itself from either or both of the Classes, it will not get money or benefits from the Class(es) if any are obtained from a settlement or trial of the lawsuits involving the Defendants. If a TPP excludes itself, it is no longer part of the Classes, and nothing that happens in the lawsuits affects it. But a TPP that properly excludes itself can sue or be part of a different lawsuit against the Defendants about the claims in this case. If you do not exclude yourself, you are bound by the result in the lawsuits. Thus, if Defendants win, your claim will be extinguished, Defendants claim that the persons and entities representing your interests do not have a valid claim and if that is correct, your claim will be extinguished unless you exclude yourself.
17. Can a TPP Class Member appear or speak in these lawsuits? As long as it doesn’t exclude itself, a TPP Class Member can (but does not have to) participate and speak for itself in these lawsuits through its own lawyer. This is called making an appearance. Remember that the TPP Class Member may have to pay for the lawyer itself. If a TPP Class Member appears in these lawsuits, it is still a Class Member and can share in any benefits the Classes might receive as a result of settlements or trials.
18. How does a TPP Class Member appear in these lawsuits? If a TPP Class Member wants its own lawyer instead of Class Counsel to participate or speak for it in these lawsuits, its lawyer must give the Court a paper that is called a Notice of Appearance. The Notice of Appearance should include the name and number of the litigation, the civil action number and state that it wishes to enter an appearance in these lawsuits. The Notice of Appearance must be filed with the Court at the following address:
The Notice of Appearance must be filed using the following Civil Action Number:
A Notice of Appearance should be filed with the Court before the series of trials of each Defendant in these lawsuits begin. The Court has not yet decided who is right in this litigation and will conduct a trial of the claims against each Defendant as they relate to TPPs beginning in November 2006.
If You Do Nothing 19. What happens if a TPP Class Member doesn’t do anything at all? If a TPP does nothing, it stays in one or more of the Classes. As a member of one or more Class, it will be bound by the results of one or more trials, whether those results are favorable or unfavorable to the Class, and the TPP will not be able to sue any Defendant(s) on its own. Depending on the outcome of the Class trial or trials or other rulings by the Court, in the future Class Members may be asked to provide information regarding the drugs they paid for in order to claim a portion of any class recovery. You will receive further instructions at that time explaining what information you are required to furnish and where and when to send it if there is a recovery or settlement. There is no recovery or settlement at this time.
The Lawyers Representing TPP Class Members 20. Do TPP Class Members have a lawyer in these lawsuits? Yes. The Court has appointed the following law firms to represent TPP Class Members:
These lawyers are called Class Counsel. Class Members won’t be charged personally for these lawyers, but they will ask the Court to award them a fee to be paid out of any recovery. More information about Class Counsel and their experience is available at the Web sites listed above.
21. Can you elaborate on who pays Class Counsel and how much will they be paid? If Class Counsel obtains money or benefits for the Classes through a settlement or a successful trial, they will ask the Court for payment of attorneys’ fees and costs out of the total amount of money and benefits obtained. The Court must approve the amount of attorneys’ fees and costs. If Class Counsel doesn’t obtain any money or benefits for the Classes, they won’t receive or ask to receive any attorneys’ fees or reimbursement of expenses.
22. Should a TPP Class Member get its own lawyer? A TPP Class Member doesn’t need to hire its own lawyer, but, if a TPP wants its own lawyer to speak for it or appear in Court, it must file a Notice of Appearance (see Question 18 to find out how to submit a Notice of Appearance). If a Class Member hires a lawyer to appear for it in the lawsuits, it will have to make its own arrangement for that lawyer’s compensation.
Getting More Information 23. Are more details and information available? The Notice is just a summary of the lawsuits. More details are in the Complaint filed by Class Counsel and the other legal documents that have been filed with the Court in these lawsuits. Anyone can look at and copy these legal documents at any time during regular office hours at the Office of the Clerk of Court, John Joseph Moakley U.S. Courthouse, 1 Courthouse Way, Suite 2300, Boston, Massachusetts 02210. Copies of some of the important documents, like the Complaint, are also available at the links on the left. In addition, if you have any questions about the lawsuits or the Notice, you may:
24. How will I be notified about the outcome of the trials? Information about the trials will be posted on this Web site as appropriate. You may also register on this Web site or by mail to get notification of the outcome of the litigation and other significant occurrences associated with these cases. To register by mail send a letter to the AWP Litigation Administrator at the address in Question 23. To register on this Web site, go to the “Register to Receive Email Updates” at the link on the left.
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