$15M Sought in Adderall Pay-For-Delay Deal

Consumers are seeking approval of a nearly $15 million settlement in a class action against Shire US Inc. As you may recall from our previous blog, Shire has been accused of staving off generic competition by paying rival drug manufacturers, including Teva Pharmaceuticals USA Inc. and Impax Laboratories Inc., to delay selling less expensive versions of Adderall. This pay-for-delay scheme is alleged to be a direct violation of U.S. antitrust laws that has caused approximately $10 million in damages to consumers in Florida. The case is Barba et al. v. Shire US Inc. et al. in the U.S. District Court for the Southern District of Florida (case number 1:13-cv-21158).

The $14.75 million settlement covers plaintiffs from 35 states and the District of Columbia who purchased Adderall XR since January of 2007. The possibility of a settlement in the case was initially revealed in February, when both sides asked the court to vacate all scheduled court dates and deadlines. This occurred just before the trial was set to begin in the Southern District of Florida.

In recent months, the two sides of the lawsuit were fighting over whether the plaintiffs should receive class certification. Shire claimed that the judge’s decision to grant the certification should have been rejected on the grounds that it was filled with errors.

Those leading the class action lawsuit against the drug manufacturer told the U.S. District Judge hearing the case that the terms of the agreement were reasonable and that plaintiffs could avoid the risks involved with taking the matter to trial by striking a deal now. In order to prevail at trial, the plaintiffs would have to overcome Shire’s objections to the class certification as well as a pending motion filed by Shire seeking summary judgment. Shire has not opposed the motion for preliminary approval of the settlement. The amount of the settlement is considered a “tremendous deal” for plaintiffs.

The settlement was reached during a day-long mediation in February. Potential class members have proposed a schedule allowing potential class members until the end of September to object to the settlement or opt out of the deal. A final fairness hearing could be set for November of this year.

The plaintiffs’ attorneys have indicated that they plan to seek attorney fees of up to 35 percent of the settlement fund.

The plaintiffs are represented by Richard M. Golomb of Golomb Legal, P.C., Brian T. Ku, Louis Mussman and M. Ryan Casey of Ku & Mussman PA, Gillian L. Wade and Sara D. Avila of Milstein Adelman LLP, and Conlee Whiteley, Alan Kanner and John R. Davis of Kanner & Whiteley LLC.

Shire US Inc. is represented by Eric Christu and Daniel Barskey of Shutts & Bowen LLP and David A. Zwally, Edgar H. Haug, John F. Collins, Porter F. Fleming, David S. Shotlander and Michael F. Brockmeyer of Frommer Lawrence & Haug LLP.