US Justice Department subpoenas Taro over prices
WASHINGTON (Reuters) – Taro Pharmaceutical Industries Ltd. and two of its senior officers received grand-jury subpoenas last week in connection with a federal antitrust investigation into generic-drug pricing, the company disclosed.
The company, which is headquartered in Israel, said late on Friday it received subpoenas on Thursday from the US Justice Department’s Antitrust Division.
The subpoenas seek documents related to “corporate and employee records, generic pharmaceutical products and pricing” and the company’s “communications with competitors and others” related to the sale of generic products.
The filing, which was posted after US markets closed on Friday, did not name the two executives who were subpoenaed.
“Taro intends to respond to the subpoena and otherwise cooperate with the Department of Justice investigation,” the company said in the filing.
Taro is the maker of many popular generic over-the-counter ointments, including antibiotic pain-relief and Hydrocortisone creams used to relieve itching and minor skin rashes.
It also manufacturers prescription creams such as Clobetasol, which treats a variety of skin disorders, including eczema and psoriasis.
A story published by the Boston Globe last year highlighted concerns about the rising prices of some generic drugs, including Clobetasol, which is made by several companies. The newspaper reported that the price of Clobetasol rose to $4.15 a gram in 2015 from $0.26 in 2013.
It was not clear from Friday’s filing whether Clobetasol is among the products being reviewed by the Justice Department.
The rising cost of prescription medications has become a high-profile issue over the past year, with various companies coming under scrutiny for drastically raising the prices of their drugs and devices.
Companies including Valeant Pharmaceuticals and Turing Pharmaceuticals were both targets of congressional investigations earlier this year for hiking the price of life-saving drugs, with Turing also facing antitrust probes by the Federal Trade Commission and the New York attorney general.
Separately, Valeant faces investigations by federal prosecutors into its pricing and distribution.
More recently, Mylan NV has come under fire for raising the price of its allergy auto-injector EpiPen. The New York attorney general disclosed earlier this month he had launched an antitrust probe into the company’s contracts to provide EpiPens to schools. The company is also facing congressional probes.
The issue has also resonated on the campaign trail, with Democratic presidential nominee Hillary Clinton saying that if elected in November, she would create an oversight panel to protect US consumers from large price hikes on long-available life-saving drugs.