KPH Healthcare Services has sought preliminary court approval for a $246.75 million class-action settlement with Gilead Sciences over alleged anti-competitive practices involving the delay of generic HIV drug alternatives, according to court documents.
In a landmark development, Plaintiff KPH Healthcare Services, Inc., doing business as Kinney Drugs, Inc., has formally sought preliminary approval for a class-action settlement with pharmaceutical giant Gilead Sciences, Inc., and its affiliated entities. The court filing, presented in the case No. 3:19-CV-02573-EMC, could potentially herald a turning point in a contentious legal battle.
The motion details the terms of the settlement, in which Gilead will pay $246,750,000 into a settlement fund to benefit the certified Direct Purchaser Classes. The Court is now tasked with assessing the fairness, reasonableness and adequacy of the proposed agreement under Federal Rule of Civil Procedure 23(e).
The lawsuit traced back to accusations that Gilead employed anti-competitive practices to maintain its market dominance. Allegedly, the company sought to obstruct the introduction of generic alternatives to its HIV drugs Truvada and Atripla. The plaintiffs argued that Gilead's actions deliberately shifted HIV patients from older drugs with generic alternatives to its newer products, effectively undermining competition.
According to the allegations, Gilead's actions were in violation of Sections 1 and 2 of the Sherman Act, causing Direct Purchaser Plaintiffs (DPPs) to pay more for the HIV drugs than they would have if generic versions had been available. The settlement, if approved, will see Gilead pay the aforementioned sum in exchange for certain releases and the dismissal of the legal action.
The settlement motion also includes the appointment of KCC Class Action Services, LLC as settlement administrator and The Huntington National Bank as escrow agent for the Gilead Settlement Fund. Furthermore, it proposes a schedule for the final approval process, including specific deadlines for claim submissions, objections and a date for a Final Approval Hearing.
Gilead Sciences has not opposed the motion, and a hearing is set for Sept. 21. However, the court documents stated, "KPH respectfully submits that this matter is appropriate for disposition without a hearing, and requests that the Court vacate the hearing date and decide the motion on the papers," which could potentially expedite the resolution of this significant legal dispute.
