Bausch Health (NYSE:BHC) and Teva (NYSE:TEVA) are facing a lawsuit accusing them of conspiring to delay the release of a cheaper generic version of Bausch’s diarrhea drug, Xifaxan, keeping prices artificially high, according to a Reuters article.
The case, filed in Rhode Island federal court by the Rhode Island Laborers Health & Welfare Fund, claims Bausch paid Teva in 2018 to postpone selling a generic version of Xifaxan 550 mg, violating antitrust laws.
The fund, which covers medical costs for its members, said it will continue paying inflated prices until at least January 2028, when Teva is permitted to launch its generic version.
Xifaxan, which earned nearly $2 billion in U.S. sales last year, costs over $2,000 for a 14-day supply, compared to under $200 in a competitive market, according to the lawsuit.
Bausch acquired Xifaxan in 2015 through its purchase of Salix Pharmaceuticals.
The plaintiffs are seeking unspecified damages and a court order to stop the alleged anticompetitive practices.