On May 14, 2021, Judge Nathaniel M. Gorton of the U.S. District Court for the District of Massachusetts granted the End-Payor Plaintiffs’ (“EPPs’”) class certification motion. The EPPs are third party payors paying some or all of the purchase price for prescription drugs, including commercial insurers and health plan sponsors. The EPPs allege that Ranbaxy’s wrongful acquisition of tentative approval to manufacture generic versions of three drugs caused generic delay, resulting in no generic competition and higher prices for third party payors. The Court certified two classes for each of the three at-issue drugs: high blood pressure drug Diovan, acid reflux medication Nexium, and the antiviral Valcyte.
In certifying the classes, the Court rejected Ranbaxy’s primary argument that common issues among the EPP classes did not predominate as required under Rule 23(b)(3). First, the Court concluded that EPPs’ expert’s “careful and thorough analysis” demonstrated that all or virtually all class members suffered an injury proven through common evidence to satisfy predominance. The Court found EPPs’ use of averages to prove classwide injury and damages was widely accepted and especially appropriate here because “defendants greatly exaggerate the variation in pricing of the at-issue drugs.” Further, in line with In re Nexium Antitrust Litig., 777 F.3d 9, 19 (1st Cir. 2015), any offsets such as manufacturer rebates were relevant to the extent of damages and not relevant for purposes of antitrust injury. Significantly, in rejecting Ranbaxy’s claim that the classes contained uninjured so-called “brand loyal” third party payors, which would not have purchased generics under any circumstances, the Court explained evidence showed just the opposite, and “brand loyalty is doubtful among [third party payors] and  meaningful generic competition would likely cause all [third party payors] to purchase generics.”
Second, the Court held that variation in the relevant state laws underpinning the EPPs’ claims did not defeat predominance because the state antitrust and consumer protection laws shared virtually identical core elements and minor differences could be accommodated through special jury instructions and verdict forms.
Finally, the Court was satisfied with EPPs’ proposed procedure of ascertaining class members through the use of detailed pharmaceutical transaction data and weeding out uninjured class members to comply with the implied ascertainably requirement of the predominance inquiry. The Court reasoned that EPPs had established that the requisite data exist, proffered a detailed approach for using it to identify class members, and that such a process was administratively feasible.
Lowey Dannenberg was appointed Interim Co-Lead Counsel on behalf of the EPPs in April 2019. The case is In re Ranbaxy Generic Drug Application Antitrust Litigation, No. 19-MD-02878-NMG, (D. Mass.).