Division Secures Individual and Corporate Guilty Pleas for Collusion Affecting Millions of American Consumers

Division Update Spring 2017

Over the past year, the Division’s criminal investigations have uncovered collusion affecting crucial products used by millions of American consumers. The Division’s investigations into collusion in the generic pharmaceutical and electrolytic capacitors industries have resulted in individual and corporate charges and guilty pleas, and the investigations are still ongoing.

Generic Prescription Drugs

Generic Prescription Drugs

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Millions of Americans purchase generic prescription drugs every year and rely on generic pharmaceuticals as a more affordable alternative to brand name medicines. The Division’s investigation into the generics market, however, has revealed that some executives have sought to collude on prices and enrich themselves at the expense of American consumers.

In January 2017, two former senior-level executives pleaded guilty for participating in conspiracies to fix prices, rig bids, and allocate customers for certain generic drugs (U.S. v. Malek, U.S. v. Glazer). These executives—the former CEO and former president of a generic pharmaceutical company—were charged with conspiring with others to fix prices, rig bids, and allocate customers for an antibiotic called doxycycline hyclate, from as early as April 2013 through at least December 2015. The executives were also charged with conspiring to fix prices and allocate customers for a diabetes treatment, glyburide, from as early as April 2014 until at least December 2015.

The Division’s investigation is ongoing, and the Division is committed to ensuring that generic pharmaceutical companies and their executives compete vigorously to provide these essential products at a competitive price.

Capacitors

Capacitors

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Another industry affecting millions of Americans is the production and sale of capacitors, which regulate the electrical current in computers, televisions, car engines, and other everyday appliances. The Division’s investigation into an international conspiracy to fix prices for electrolytic capacitors sold to customers in the United States and elsewhere has, to date, led to criminal charges against six companies and ten individuals. All have pleaded or will plead guilty to the charges. These pleas have resulted in almost $40 million in criminal fines.

As with generic drugs, the Division’s investigation remains ongoing, and it is committed to pursuing those who undermine competition for technology components.

Updated March 28, 2017