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  • Writer's pictureDan Curto

Vyera settles FTC claims it prevented generic competition for $40 million

Vyera (formerly Turing), the company founded by Martin Shkreli, settled a federal antitrust lawsuit brought by the FTC and the New York AG that alleged that Vyera engaged in anti-competitive practices to keep generics off the market after it hiked the price of Daraprim by more than 4,000%. I'm not going to put much analysis into this settlement because (1) I'm not an antitrust lawyer and (2) Shkreli and Vyera (Turing) are hopefully outliers in how they behaved in acquiring and selling Daraprim.

The most interesting part of this case is the alleged anti-competitive behavior. In the government's complaint, it alleged the following as anti-competitive:

  • Vyera, through contractual restrictions, prohibited distributors and purchasers from reselling Daraprim to generic companies or agents. As a result of these resale restrictions, generic companies could not purchase sufficient quantities of Daraprim to conduct FDA-required tests. The government claims several companies tried for more than a year to secure enough Daraprim to conduct FDA-required tests and were unable to do so.

  • Vyera cut off access to the active pharmaceutical ingredient ("API") necessary to manufacture Daraprim. They did this by entering into an exclusive supply agreement with the only supplier. After locking up this supplier, it entered into a second exclusive agreement with another potential supplier so that supplier would not start making the API for potential competitors.

  • Vyera prevented its distributors from selling Daraprim sales data to third-party data reporting companies like IQVIA. As a result, potential generic competitors had no way of knowing the size of the market.

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