Teva Pharmaceutical Industries ($TEVA) Investor Settlement

The parties have reached an agreement to settle the case, but the terms are still being finalized. You can submit your application now, and it will be processed once claims filing opens.

E.D. Pennsylvania

Court

2:20-cv-04660

Case number

10/29/2015

Class period Start

08/20/2020

Class period End

Teva Pharmaceutical has reached a tentative settlement to resolve investor claims that it concealed an illegal kickback scheme used to inflate Copaxone sales.

Outline:

Teva touted Copaxone as its leading specialty medicine, attributing the drug's soaring sales and steep price increases to strong underlying demand, patient loyalty, and its Shared Solutions support program. Investors say Teva was actually using charitable foundations as illegal pass-through conduits to cover Medicare patients' co-pays for the drug. On August 18, 2020, the U.S. Department of Justice filed a complaint alleging Teva made $328.6 million in kickback payments between 2006 and 2015, and $TEVA fell roughly 15%. The case has now moved to a tentative settlement.

Timeline:
October 29, 2015: Teva reported record Copaxone sales, attributing the drug's success to its Shared Solutions program and strong market demand.
August 3, 2017: Teva disclosed it had received a subpoena from the U.S. Attorney's office regarding its donations to patient assistance programs; $TEVA fell approximately 41% over the following three trading days.
November 2, 2017: Teva cut its 2017 financial guidance, citing declining Copaxone revenue, and $TEVA fell approximately 20%.
August 18, 2020: The DOJ filed a False Claims Act complaint alleging Teva paid $328.6 million in kickbacks to charitable foundations between 2006 and 2015 to cover Copaxone patients' Medicare co-pays; $TEVA fell approximately 15%.
Background:

Teva Pharmaceutical Industries, an Israeli pharmaceutical company, marketed Copaxone, its multiple sclerosis treatment, as its leading specialty medicine. Teva's securities trade on the NYSE and Tel Aviv Stock Exchange under the ticker $TEVA.

Teva told investors that Copaxone's soaring sales and price increases, which rose more than 19 times the rate of inflation between 2006 and 2015, reflected strong underlying demand, brand loyalty among patients and physicians, and the value of its Shared Solutions patient support program.

Investors say the real driver of Copaxone's success was different. According to the case, Teva used specialty pharmacy Advanced Care Scripts and charitable foundations Chronic Disease Fund and The Assistance Fund as unlawful pass-through conduits, funding Medicare patients' co-pays for Copaxone in violation of federal anti-kickback laws — which kept patients on the drug despite its steep price increases.

The scheme came to light in stages. On August 3, 2017, Teva disclosed it had received a subpoena from the U.S. Attorney's office in Boston seeking information about its donations to patient assistance programs. 

On November 2, 2017, Teva cut its financial guidance, citing weakening Copaxone sales. On August 18, 2020, the DOJ filed a formal complaint alleging Teva made $328.6 million in kickback payments from 2006 through 2015.

Following the August 2020 disclosure, $TEVA fell approximately 15%. The case has now moved to a tentative settlement.

What Can Investors Expect Now?

Teva Pharmaceutical has reached a tentative settlement to resolve investor claims that it concealed an illegal kickback scheme used to inflate Copaxone sales.

If you were damaged due to this situation, you can file for a payout and get your share of the settlement. You can check if you are eligible and other details in the FAQ section.

Case Type

US Securities Class Action

Case Status

Tentative Settlement

Alleged Offence

Misleading Statements,

Failure to Disclose

Suspected Party

Directors,

Management

Security Type

Depository Securities (ADS, ADR, GDR)

Trade Direction

Long

Filing date

09/30/2020

Plaintiffs

Gerald Forsythe

Attorneys

Faruqi & Faruqi, LLP

Defendants

Erez Vigodman, Eyal Desheh, Robert Koremans, Michael Derkacz

Trades matching type

FIFO

Teva Pharmaceutical Industries ($TEVA) Investor Settlement

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