A federal jury rejected charges by GlaxoSmithKline that Abbott Laboratories with stifling competition and creating an illegal monopoly after more than quadrupling the price of its Norvir med, which is used in AIDS cocktails. However, Abbott was ordered to pay $3.4 million for breaching licensing contracts. This is a far cry from the $571 million that Glaxo sought in damages, though.
Here's the background: Abbott sells a combo pill called Kaletra that includes Norvir and its own protease inhibitor. Glaxo claims Abbott raised Norvir’s price - but not the Kaletra price - in 2003 in order to boost Kaletra sales at the expense of other protease inhibitors that require Norvir as a booster. In other words, Abbott allegedly tried to use Norvir to create an illegal monopoly (back story).
Glaxo lawyers argued in a federal court in California that the price hike caused Glaxo’s Lexiva, which includes Norvir, to cost 75 percent more a day than Kaletra. The Norvir price, by the way, was raised about a month after Lexiva was introduced. Consequently, Glaxo claims to have lost more than $570 million in profits, because Lexiva was sold at only half the rate the drugmaker believed was possible.
Glaxo "wanted us to carry damages out to 2017, but we decided the market was disrupted for three months,” jury foreman Michael Friedman tells Bloomberg News. The jurors, he adds, focused on prescriptions sold by Glaxo in the three months immediately following the market disruption and used that to calculate lost sales during the preceding period of sales disruption.
An Abbott spokeswoman writes us: "We are disappointed that the jury found that Abbott breached its license agreement with GSK and we are considering our options, including whether to appeal the jury's decision. However, the jury's awarding of $3.4 million dollars in damages, instead of the $571 million that GSK was asking for, confirms our view that GSK's alleged damages were inaccurate and inflated."