Daily Journal – by John Roemer

Joseph R. Saveri continues to make news with his long-running challenge to pay-to-delay deals between brand name drug manufacturers and their generic rivals.

Next month, he plans to go to trial in San Diego against remaining defendant Barr Laboratories Inc. in an antitrust class action over Bayer Corp.’s antibiotic Ciprofloxacin, or Cipro, on claims Barr and Bayer illegally agreed on a reverse payment to keep a generic version of the drug off the market.  Last month, Saveri won preliminary approval of a $100 million settlement with most of the remaining defendants.  Earlier, Bayer settled for $74 million.

“It’s one that might actually go to trial,” Saveri said, acknowledging that class actions rarely get before juries.  “We and Barr have had no settlement talks.”  In re Cipro Cases I & II, 4154 and 4220 (S.D. Super. Ct., filed Aug. 5, 2002).

Cipro took on greater significance last year when the state Supreme Court reversed a state appellate panel and held that pay-to-delay deals are subject to antitrust scrutiny under California law.  “Parties illegally restrain trade when they privately agree to substitute consensual monopoly in place of potential competition,” the unanimous court held.  The opinion lined up with the 2013 Actavis ruling, in which the U.S. Supreme Court applied federal law to the same question.

Saveri said that the state high court’s Cipro holding is directly relevant to his similar challenge over the pain patch Lidoderm.  He is liaison counsel for a proposed class of Lidoderm end-payors alleging pay-to-delay antitrust violations between Endo Pharmaceuticals Inc. and Actavis Inc. in which Endo provided at least $96 million worth of Lidoderm to Actavis to keep generic patches off the market for more than a year plus other deals undermining generic price competition.

“Cipro and the Lidoderm case are connected at a basic level,” Saveri said.  “Actavis led to more federal cases” on pay-to-delay claims, while “Lidoderm is based on state law and has more to do with the state Supreme Court ruling.”  In re Lidoderm Antitrust Litigation, 3:14-md-2521 (N.D. Cal., filed April 3, 2014).  The Lidoderm plaintiffs have defeated defense motions to dismiss and discovery is underway.

In August, Saveri and colleagues won an important ruling from U.S. District Judge William H. Orrick III of San Francisco, who is overseeing Lidoderm, that will let more plaintiffs in antitrust suits gain disclosure of otherwise privileged defense attorney-client communications on issues central to the dispute.  “There’s been a lot of litigation on the scope of the privilege in these cases,” Saveri said.  “This helps clear it up.”

Saveri said he’s currently devoting much time to another class action about capacitors used in electronic devices, with allegations that defendant companies formed a cartel that conspired to fix, raise, and stabilize prices in the multi-billion dollar market for aluminum, tantalum, and film capacitors.  In re Capacitors Antitrust Litigation, 4:14-cv-03264 (N.D. Cal., filed July 18, 2014).