Virginia, 40 other states reach settle with two former executives in drug investigation

Herring speaking at Thursday, April 6's Unsung Heroes Awards ceremony. (Credit: AGMarkHerring on twitter) (Copyright by WSLS - All rights reserved)

RICHMOND, Va. – Two former executives of a New Jersey-based generic pharmaceutical manufacturer have entered into settlement and cooperation agreements with 40 states, Virginia Attorney General Mark R. Herring said.

The states are investigating alleged widespread anti-competitive activity in the generic drug industry that has led to higher prices for consumers and state governments.

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"Millions of Virginians, especially seniors, rely on generic medications as an affordable option for the prescriptions they need, and any attempt to manipulate these prices is callous and wrong," Herring said. "These settlements are an important step forward in this litigation, which sends a strong message to pharmaceutical manufacturers across the country that anyone who tries to artificially inflate prices and take money from the pockets of Virginians will be held accountable for their actions."

Jason Malek, former president of Heritage Pharmaceuticals Inc., and Jeffrey Glazer, former chairman and chief executive officer of the company, have agreed to cooperate in the states' ongoing litigation and investigation, including by providing information, documents, testimony, depositions and other evidence to support the investigation.

Herring previously joined with 18 other state attorneys general in December in filing a federal lawsuit against generic drug-makers Heritage Pharmaceuticals, Aurobindo Pharma USA Inc., Citron Pharma LLC, Mayne Pharma (USA) Inc., Mylan Pharmaceuticals Inc. and Teva Pharmaceuticals USA Inc., alleging that they conspired to artificially inflate and manipulate prices and reduce competition in the market for two drugs in the United States: doxycycline hyclate delayed release, an antibiotic, and glyburide, an oral diabetes medication.

In December, Glazer and Malek each entered into plea agreements with the U.S. Department of Justice after being charged with two counts of criminal violations of the Sherman Antitrust Act. In addition to their cooperation with the states' investigation, Glazer and Malek will each pay a $25,000 civil penalty to the states.

This matter is being handled by the antitrust unit of Attorney General Herring's Consumer Protection Section. In November, Herring announced the completion of a reorganization of the Consumer Protection Section to more efficiently and effectively enforce Virginia's consumer protection laws, provide exceptional customer service in resolving complaints and disputes, and provide robust consumer education to keep Virginians from being victimized by fraud, scams, or illegal or abusive business practices.

During Herring's administration, the Consumer Protection Section has recovered more than $200 million in relief for consumers and payments from violators.