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In re EpiPen Epinephrine Injection, USP Marketing, Sales Practices and Antitrust Litigation

United States District Court, D. Kansas

January 2, 2018

IN RE EpiPen Epinephrine Injection, USP Marketing, Sales Practices and Antitrust Litigation This Document Applies to the Notice of Related Action Filed August 31, 2017 Doc. 12

          MEMORANDUM AND ORDER

          DANIEL D. CRABTREE, UNITED STATES DISTRICT JUDGE.

         This Order addresses the Notice of Related Action filed on August 31, 2017. Doc. 12. That Notice seeks consolidation of another case pending in this judicial district in this MDL. The case is Brannon, et al. v. Express Scripts Holding Co., et al., No. 17-2497-DDC-TJJ. For reasons explained below, the court concludes that consolidation of the Brannon case in this MDL is not warranted under our local rule, D. Kan. Rule 23-A(e). The court thus declines to consolidate Brannon into MDL No. 2785.

         I. Factual Background

         On August 29, 2017, plaintiffs Traci Brannon, Lindsey Rizzo, and Jamie Herr (“the Brannon plaintiffs”), individually and on behalf of all others similarly situated, filed a Class Action Complaint in the District of Kansas. Brannon, et al. v. Express Scripts Holding Co., et al., No. 17-2497-DDC-TJJ, ECF 1. The Complaint names five defendants who own or operate pharmacy benefit management companies. The five defendants are: (1) Express Scripts Holding Company; (2) Express Scripts, Inc.; (3) UnitedHealth Group, Inc.; (4) OptumRx, Inc.; and (5) Prime Therapeutics, LLC. The Brannon plaintiffs are enrolled in employer-provided welfare benefit health plans through one of those five defendants. The Employee Retirement Income Security Act of 1974 (“ERISA”) governs these plans.

         The Brannon plaintiffs allege that the defendant pharmacy benefit managers contracted on behalf of health plans and insurers with Mylan N.V., Mylan Specialty L.P., and/or Mylan Pharmaceuticals, Inc. (collectively, “Mylan”) to purchase EpiPen epinephrine injectors. And in doing so, plaintiffs assert, defendants violated ERISA by engaging in extortion and deceptive conduct with the purpose to extract unlawful portions of rebates and other payments funded by Mylan. The Brannon Complaint refers to these payments as the “PBM Kickbacks.”

         Based on this theory, the Brannon plaintiffs seek to recover hundreds of millions of dollars allegedly paid to defendants through the “creation, maintenance, and concealment of a multi-tiered fraudulent scheme designed to deceive consumers through the marketing and sale of the EpiPen epinephrine injector.” Brannon, No. 17-2497-DDC-TJJ, ECF 1 ¶ 1. The Brannon plaintiffs seek to represent a proposed class they define as:

The ERISA Class. All individuals residing in the United States and its territories who are or were enrolled in an ERISA-covered health benefit plan or health insurance plan for which one or more of the PBM Defendants administers or manages pharmacy benefits, who purchased an EpiPen epinephrine injector pursuant to such plans or policies and were required to pay all or a portion of the purchase price based on an inflated list price (the “ERISA Class”).
Excluded from the Class are: (a) the named Defendants and any entity in which they have a controlling interest, and their legal representatives, officers, directors, assignees, and successors and (b) any co-conspirators, and their officers, directors, management, employees, subsidiaries, and affiliates.

Id. ¶ 138.

         The Brannon Complaint asserts four claims: (1) violating ERISA § 406(b) (29 U.S.C. § 1106(b)) by engaging in prohibited transactions between a plan and a fiduciary; (2) violating ERISA § 404 (29 U.S.C. § 1104) by breaching fiduciary duties of loyalty and prudence; (3) violating ERISA § 702 (29 U.S.C. § 1182) by discriminating against plan participants and beneficiaries who have a medical condition requiring an EpiPen because defendants' alleged use of artificially inflated prices and undisclosed and excessive PBM Kickbacks have required them to pay greater premiums and contributions for their health plan benefits than those participants and beneficiaries not requiring an EpiPen; and (4) violation of ERISA § 502(a)(3) (29 U.S.C. § 1132(a)(3)) for knowing participation in ERISA violations.

         On August 31, 2017, consistent with our local rule 23-A, the Brannon plaintiffs filed a Notice of Related Case in the MDL (Doc. 12). See D. Kan. Rule 23-A(a). Their Notice asks the court to consolidate the Brannon action into MDL No. 2785 because, the Brannon plaintiffs contend, Brannon “concerns the same subject matter as pending in . . . . MDL No. 2785.” Doc. 12 at 1.

         The Brannon defendants have filed responses opposing consolidation of Brannon into the MDL. See Doc. 31 (defendants Express Scripts Holding Co. and Express Script's Inc.'s Response); Doc. 34 (defendant Prime Therapeutics LLC's Response); and Doc. 36 (defendants OptumRx, Inc. and UnitedHealth Group, Inc.'s Response). Also, the MDL defendants have filed a response opposing consolidation. Doc. 35 (defendants Mylan Inc. and Mylan Specialty L.P.'s Objection). And, plaintiffs in an action pending in the District of Minnesota (“the Klein plaintiffs”) have entered a limited appearance in the MDL for the purpose of opposing consolidation.[1] Doc. 17.

         The court considers the parties' arguments for and against consolidation below.

         II. ...


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