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Pfizer, Abbott, Glaxo Sued Over Brand-Drug Co-Pay Discounts

Affiliates of a consumer group sued eight drugmakers including Pfizer Inc. (PFE), Abbott Laboratories (ABT) and GlaxoSmithKline Plc (GSK), accusing the companies of illegally offering coupons to reduce copayments for brand name drugs.

Affiliates of Boston-based Community Catalyst contend that cutting co-pays for the drugs destroys the incentive to use cheaper generic drugs, in a suit filed today in federal court in Newark, New Jersey, against Merck & Co. (MRK) Identical cases were filed in New York, Philadelphia and Chicago.

“A recent study estimated that these kickbacks will increase health benefit providers’ prescription drug costs by $32 billion over the next 10 years,” plaintiffs’ lawyer Lisa J. Rodriguez of Haddonfield, New Jersey, said in one complaint.

Also sued were Amgen Inc. (AMGN), AstraZeneca Plc (AZN), Bristol-Meyers Squibb Co. (BMY) and Novartis AG. (NOV)

“Given the larger cost-sharing burden being placed on patients, Pfizer supports the use of company-sponsored programs which help patients with out-of-pocket expenses for the medicines prescribed by their physician,” Christopher Loder, a Pfizer spokesman, said in an e-mailed statement. The company will fight the claim, he said.

The lawsuits were filed by the AFSCME District Council 37 Health & Security Plan Trust, the Sergeants Benevolent Association Health and Welfare Fund, the New England Carpenters Health and Welfare Fund and the Plumbers and Pipefitters Local 572 Health and Welfare Fund.

Health Plans

The community group said in a statement the health plans, struggling with rising costs, provide drug benefits for civilian and uniformed municipals workers, retirees and their dependents throughout the city of New York, plumbers from Florida to Ohio, and carpenters throughout New England.

“Our lawyers still have not received the brief; we won’t comment before we’ve had an opportunity to review the brief,” said Mary Klem, an Amgen spokeswoman.

Sarah Lindgreen, an AstraZeneca spokeswoman; Ron Rogers, a spokesman for Merck; Sabrina Oei, a Novartis spokeswoman; Adelle Infante of Abbott; Laura Hortas of Bristol-Meyers; and officials of Glaxo didn’t immediately respond to voice and e-mail messages seeking comment on the lawsuits.

Some of the drugs named in the lawsuits are Pfizer’s Celebrex and Lipitor, Novartis’s Diovan, Amgen’s Enbrel, Merck’s Nasonex and Vytorin, and AstraZeneca’s Crestor and Nexium.

The first Newark case is Plumbers and Pipefitters Local 572 Health and Welfare Fund, 3:12-cv-01379, U.S. District Court, District of New Jersey (Newark).

To contact the reporters on this story: Phil Milford in Wilmington, Delaware, at pmilford@bloomberg.net; Dawn McCarty in Wilmington, Delaware, at dmccarty@bloomberg.net.

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net.

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