As the chances for passage of pharmaceutical pricing and oversight bills fade in Congress and the White House, there is a bit of good news on that front from the Department of Justice (DOJ). Three generic drug makers have agreed to pay $447.2 million to resolve price-fixing allegations related to their attempts to conspire to fix the price of several generic drugs.

Three companies, Taro Pharmaceuticals USA, Inc., Sandoz Inc., and Apotex Corporation, agreed on October 1 to pay nearly $450 million to settle DOJ allegations that they violated the False Claims Act, a federal law that criminalizes making false claims regarding any federal health care program. DOJ claims the three manufacturers conspired to fix the prices of drugs, actions that caused significantly higher drug prices for federal health care programs and the consumers who rely on them.

“Americans have the right to purchase generic drugs set by fair and open competition, not collusion,” said Special Agent in Charge Maureen R. Dixon of the Philadelphia Regional Office of the Inspector General, Department of Health and Human Services (HHS-OIG) in the DOJ release.

DOJ’s press release provided the background of the settlement. Between 2013 and 2015, the three companies allegedly violated the Anti-Kickback Statute, a federal criminal law that prohibits the receipt of anything of value to companies that refer business to Medicare; Medicaid; TRICARE, the health care system of the U.S. military and their dependents; and other federal health care programs. They did this by colluding on the price, supply and allocations of some of their generic drugs.

Taro Pharmaceuticals of New York will pay $213.2 million for their sale of an anti-inflammatory arthritis medication called etodolac and nystatin-triamcinolone cream, a drug that fights skin infections with antifungal medicines and steroids. Sandoz, Inc. of New Jersey will pay $185 million for kickbacks related to the sale of benazepril HCTZ, a drug that treats hypertension, and clobetason, another drug that helps cure skin diseases. Finally, Apotex of Florida will pay $49 million for alleged price-fixing for pravastatin, which treats high cholesterol and triglycerides.

The DOJ release quotes Acting Assistant Attorney General Brian M. Boynton who said, “Illegal collaboration on the price or supply of drugs increases costs both to federal health care programs and beneficiaries.” Acting U.S. Attorney Jennifer Arbittier Williams for the Eastern District of Pennsylvania added, “These civil settlements are another achievement in my office’s efforts to hold generic drug companies accountable for the consequences arising from price-fixing schemes, including the harm to federal health care programs.”

The Office of the Inspector General of HHS also entered into five-year corporate integrity agreements with each of the companies. These agreements call for additional protective measures, including more transparency and requirements to regularly report and certify price information.

Each of the three generic drug companies had already obtained “deferred prosecution agreements” from DOJ’s antitrust division to resolve the criminal charges related to their price-fixing. In addition to the October 1 civil penalties, Taro’s criminal penalty was $105.6 million; Sandoz’s was $195 million and Apotex paid $24.1 million.

DOJ’s release concluded by stating, “The investigation and resolution of these matters illustrates the government’s emphasis on combating healthcare fraud. “ But, as anyone who purchases prescription drugs knows, generic drug prices and fraud are not the only causes of unconscionable drug prices. Both the Senate and House of Representatives are considering bills that will provide “oversight and disclosure requirements relating to the prices of brand-name drugs.”

“The Prescription Drug Price Relief Act of 2021” is one of three bills introduced by Reps. Ro Khanna (D-CA) and Elijah Cummings (D-MD), Senator Bernie Sanders (I-VT), and several dozen other Democrats who seek to establish a series of oversight and disclosure requirements relating to the prices of brand-name drugs. This bill requires HHS to conduct annual reviews and mandates them to “void any government-granted exclusivity” if excessive prices are found. It also requires the creation of “nonexclusive licenses for drugs… (and) expedites review of applications for generic and biosimilar products.”

The bill defines as excessive any price that exceeds the “median price for the drug in Canada, the United Kingdom, Germany, France and Japan.” For any price that exceeds this formula or if the suspect drug is unavailable in three or more of these countries, the price will still be considered excessive if it is higher than reasonable according to several factors. The House bill also mandates drug companies to report various financial information about brand-name drugs, including costs for research and advertising.

The two other bills are The Medicare Drug Price Negotiation Act, which would direct HHS to negotiate lower prices for prescription drugs available under Medicare Part D, and The Affordable and Safe Prescription Drug Importation Act, which allows patients and pharmacists to import safe and affordable medicines from Canada and other countries.

Sanders’ Subcommittee on Primary Health and Retirement Security of the Health, Education, Labor and Pensions Committee has already held hearings on the Prescription Drug Price Relief Act of 2021. The bill was referred to the Committee on Health, Education, Labor and Pensions in late March.

Despite the Congressional actions and tremendous support for prescription drug price reforms, two critical Democratic Senators, West Virginia’s Joe Manchin and Arizona’s Kyrsten Sinema, are not on board with the section of Biden’s social spending package that contains the drug reforms. Sinema also told Biden in September that she objects to allowing Medicare negotiation.

For the time being, America’s prescription drug consumers will have to rely on significant but piecemeal civil and criminal actions against individual pharmaceutical companies like the three DOJ recently announced.