Daraprim TPP Settlement

The lawsuit, BCBSM, Inc. v. Vyera Pharmaceuticals, et al., No. 21-cv-1884-DLC (the “Action”) is pending in the United States District Court for the Southern District of New York (the “Court”). The lawsuit claims that Defendants Vyera Pharmaceuticals, LLC and Phoenixus AG, Martin Shkreli, and Kevin Mulleady engaged in a scheme to thwart generic competition for Daraprim in violation of Sections 1 and 2 of the Sherman Act and various state antitrust, unjust enrichment, and consumer protection laws.

WHAT DO THE SETTLEMENTS PROVIDE?

The Settlement provides a minimum cash payment to the Settlement Class of $7 million and additional potential cash payments totaling up to $21 million for a total potential settlement amount of up to $28 million.

As part of the Class Contingent Payments, the Corporate Defendants will pay into the Class Settlement Fund 14% of the net proceeds they earn from monetizing a Corporate Asset other than a Priority Review Voucher, and 14% of the net proceeds they earn from monetizing a Ketamine asset, based on any transactions executed over the next five years, up to a total of $10.5 million. The Corporate Defendants will also pay the Settlement Class 14% of the net proceeds they earn from any transaction monetizing a Priority Review Voucher executed over the next 10 years, with total Class Contingent Payments to the Settlement Class capped at $21 million.

WHO IS INCLUDED IN THE SETTLEMENT CLASS?

All entities that, for consumption by their members, employees, insureds, participants, or beneficiaries, and not for resale, indirectly purchased, paid, and/or provided reimbursement for some or all of the purchase price of Daraprim during the Settlement Class Period (August 7, 2015, through January 28. 2022.  The types of third-party payor entities that might fall within the Settlement Class include health insurance companies; union health and welfare benefit plans; self-insured employers; and entities with self-funded plans that contract with a health insurance company or other entity to serve as a third-party claims administrator to administer their prescription drug benefits.

Excluded from the Settlement Class are the following:
(a) Natural person consumers;
(b) Defendants and their employees, affiliates, parents, and subsidiaries, whether or not named in the Complaint;
(c) All federal and state governmental entities except for cities, towns, municipalities, or counties with self-funded prescription drug plans;
(d) Fully insured health plans (i.e., health plans that purchased insurance covering 100% of their reimbursement obligation to members); and
(e) Judges assigned to this case and any members of their immediate families.