Press Release

Hagens Berman Sobol Shapiro: Judge Approves Two National Classes in AWP Drug Litigation

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Posted 29 September 2008 @ 06:22 pm ET

BOSTON, Sept. 29 /PRNewswire/ -- Two major pharmaceutical companies arefacing the fire this week after U.S. District Judge Patti Saris approved twonational classes in the Average Wholesale Price litigation, allowingplaintiffs to pursue litigation against AstraZeneca (NYSE: AZN) andBristol-Myers Squibb Co. (NYSE: BMY) under unfair and deceptive trade practicelaws of more than 30 states.

(Logo: http://www.newscom.com/cgi-bin/prnh/20080317/AQM144LOGO)

Already producing multiple national settlements and a bellwether benchtrial, the case against the defendants claims the pharmaceutical manufacturersgrossly inflated the prices of branded physician-administered drugs bymisstating the Average Wholesale Price (AWP) of these drugs in industrypublications.

The published AWP often sets the price that consumers, insurance companiesand other third-party payors pay for the drug, and the lawsuit contends thatconsumers and third-party payors often paid more than market value because ofthe drug companies' deceptive AWP reporting.

Seattle-based Hagens Berman Sobol Shapiro, co-lead counsel in the case,announced approval of the two classes that includes the third-party payorMedigap Supplemental Insurance class (Medigap Class) and the consumer andthird-party payor class for Medicare part B drugs (TPPs).

"Judge Saris' ruling is monumental and sets an important precedent --instead of a class confined to one state or jurisdiction, we can now addressthe problem on a national level," said Steve Berman, Hagens Berman SobolShapiro managing partner. "This is another huge victory for plaintiffs wholong paid astronomical prices for basic chemotherapy drugs."

The first nationwide class, the Medigap Class, consists of all third-partypayors who made reimbursements for drugs based on AWP for a Medicare Part Bcovered subject drug. The second class is composed of any consumer orthird-party payors who made a payment for certain physician-administered drugsmanufactured by AstraZeneca or Bristol-Myers. This also includes allthird-party payors who made reimbursements based on contracts expressly usingAWP as a pricing standard. The class period for both parties is Jan. 1, 1991to Jan. 1, 2005.

The drugs in question are all prescribed to fight forms of cancerincluding Zoladex from AstraZeneca and Blenoxane, Taxol, Cytoxan, Robex andVepesid from Bristol-Myers. The lawsuit claims the pharmaceutical companiesinflated pricing from 27 percent to more than 1000 percent over the course ofthe outlined class period.

The defendants argue the class certification is inappropriate becauseapplication of the laws of so many jurisdictions renders trial unmanageable.However, Judge Saris states in her ruling that the Court will hold a separatetrial for each defendant.

In January 2006, the court originally denied with prejudice the motion tocertify these two classes under unfair and deceptive trade practices of statesother than Massachusetts. Since then, the plaintiffs have provided an adequateanalysis of different state statutes, convincing the court to allowcertification.

According to the ruling, Saris incorporated and relied on the factualfindings in other AWP cases for her most recent opinion. A bench trial held inNovember 2006, entered a verdict against AstraZeneca and BMS with the sameclasses outlined solely for the state of Massachusetts. This gave the courtthe opportunity to understand the complex factual and legal disputes in thisdifficult area of drug pricing and ultimately conclude that the case can infact be tried on a class-wide basis.

Other settlements in the AWP case came in August of 2006 whenGlaxoSmithKline agreed to a nationwide $70 million settlement and May of 2007when AstraZeneca agreed to a $24 million settlement to Medicare Part B Zoladexusers nationwide. After a trial, the court in November 2007 orderedAstraZeneca and Bristol-Myers Squibb to pay nearly $14 million to insurancecompanies and consumers in Massachusetts for the companies' roles in unfairtrade practices.

About Hagens Berman Sobol Shapiro

Hagens Berman Sobol Shapiro, is based in Seattle with offices in Chicago,Boston, Los Angeles, Phoenix, San Francisco and New York. Since 1993, it hasdeveloped a nationally recognized practice in class-action and complexlitigation. Among recent successes, HBSS has negotiated a $300 millionsettlement in the DRAM memory antitrust litigation; a $340 million recovery onbehalf of Enron employees; a $150 million settlement involving charges ofillegally inflated charges for the drug Lupron, and served as co-counsel onthe Visa/Mastercard litigation which resulted in a $3 billion settlement, thelargest anti-trust settlement to date. HBSS served as counsel in a $850million Washington Public Power Supply settlement and represented Washingtonand 12 other states against the tobacco industry that resulted in the largestsettlement in history. For a complete listing of HBSS cases, visithttp://www.hbsslaw.com.

CONTACTS: Steve Berman (206) 623-7292 Mark Firmani (206) 443-9357 Hagens Berman Sobol Shapiro Firmani + Associates Inc. Steve@hbsslaw.com Mark@firmani.comSOURCE Hagens Berman Sobol Shapiro


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