Retirement Funds Sue Valeant for Billions Lost Through Price-Gouging Scheme

A group of investors sued Valeant Pharmaceuticals claiming the drugmaker cost them more than $80 billion through price-gouging.

In the complaint, filed in the District Court of New Jersey, the retirement systems and pension funds for several groups of New York City employees, including the NYPD, Board of Education and Fire Department, claim the drugmaker carried out a complex scheme to create the impression of organic profit and revenue growth through acquiring other drug manufacturers and then dramatically increasing the prices of the drugs it acquired.

The price increases, the lawsuit claims, were made possible by a “captive pharmacy network” that prevented substitution of generic drugs by illegal and deceptive means, including automatic refills for prescriptions without a patient request and changing prescription codes to ensure they were refilled with branded Valeant drugs rather than a generic version.