Novartis and Sandoz Face Ongoing Antitrust Pressure in US Generics Case

A Pennsylvania federal court has delivered a mixed ruling in a major generics antitrust case, allowing key claims to proceed against Novartis and its former subsidiary Sandoz, while dismissing others.

The case, brought by large employers including General Motors and American Airlines, alleges a long-running scheme among dozens of generic drugmakers to fix prices and divide market share. These claims form part of broader multidistrict litigation that has already resulted in significant settlements.

Judge Cynthia Rufe rejected attempts by several defendants to dismiss the claims outright, preserving allegations of an overarching conspiracy in which companies allegedly agreed on a “fair share” of the generics market. The court pointed to claims of coordinated pricing behaviour and communications between competitors as sufficient to move forward.

Crucially, the court also declined to separate Novartis from Sandoz, accepting arguments that the parent company maintained control over its subsidiary’s operations, including pricing decisions. This finding keeps both entities within the scope of the litigation and potential liability.

While some claims were dismissed, including those against certain defendants not covered by earlier class actions, the majority of the case will now proceed into discovery. The ruling also addressed statute of limitations arguments, finding that earlier class actions effectively paused the clock for many of the claims dating back to 2009.

From a market perspective, the decision highlights the ongoing legal risks facing the generics sector, particularly around pricing practices. It also signals that courts may be willing to scrutinise corporate structures and relationships when assessing liability, an issue with potential implications for multinational pharmaceutical groups.

The case continues, with further proceedings likely to shape both legal exposure and industry conduct in the generics market.