Hikma Agrees to $50 Million Settlement Over Alleged Delay of Generic Xyrem Launch

Hikma Pharmaceuticals has agreed to pay $50 million to settle a class action lawsuit alleging it conspired to delay the release of a lower-cost generic version of the narcolepsy drug Xyrem, according to Reuters. The deal, filed Wednesday in federal court in San Francisco, marks a significant development in long-running antitrust litigation involving the blockbuster medication.

The plaintiffs, including the city of Providence, Rhode Island, and the New York State Teamsters Council Health and Hospital Fund, accused the London-listed pharmaceutical company of violating U.S. antitrust laws by engaging in a scheme with Xyrem’s maker, Jazz Pharmaceuticals, to postpone market entry of a generic alternative. As a result, they claim health plans and other purchasers were forced to pay inflated prices.

Hikma’s settlement follows a separate agreement last month in which Jazz Pharmaceuticals consented to pay $145 million to resolve its part of the litigation. Both settlements remain subject to approval by Chief U.S. District Judge Richard Seeborg, per Reuters.

“This agreement protects the company’s interests and provides clarity to our stakeholders,” said Hikma’s general counsel, Sam Park, in a statement. The company maintains that it did nothing wrong.

Read more: Antitrust Claims Against Jazz and Hikma to Proceed in Price-Fixing Case

Court records show the litigation dates back to 2020, when a wave of lawsuits accused Jazz of striking an unlawful agreement with Hikma to stifle competition. The plaintiffs argued that Jazz had dramatically raised the price of Xyrem—an 800% increase between 2007 and 2014—and sought to preserve its market dominance by delaying generic versions.

Hikma had received regulatory approval from the U.S. Food and Drug Administration to market a generic form of Xyrem by 2017. That same year, Hikma and Jazz settled separate litigation over patents related to the drug.

Attorneys representing the class described the settlement as “the result of hard-fought and adversarial litigation” in court filings. They have indicated they intend to seek legal fees amounting to roughly one-third of the total $195 million in combined settlements.

The case is In re: Xyrem (Sodium Oxybate) Antitrust Litigation, U.S. District Court for the Northern District of California, No. 3:20-md-02966-RS.