Bona Law Files Antitrust Lawsuit Against Pharmaceutical Associations for Scheme to Wipe International Pharmacy Competition from the Internet
September 18, 2020
Bona Law attorneys Aaron Gott, Alex Shear, and Jarod Bona filed an antitrust complaint in New York federal court on behalf of PharmacyChecker.com, alleging a conspiracy among trade groups funded or controlled by pharmaceutical manufacturers, pharmacy corporations, and Silicon Valley companies for their agreements with Internet gatekeepers to wipe information about safe online international pharmacies from the consumer-facing internet.
According to the complaint, the defendants (National Association of Boards of Pharmacy, LegitScript, Center for Safe Internet Pharmacies, Partnership for Safe Medicines, and Alliance for Safe Online Pharmacies) are each either funded or backed by pharmaceutical and pharmacy interests, and have been working with Internet gatekeepers such as Google and Microsoft to restrict consumers’ access to international pharmacy websites in order to keep the United States—which has the highest drug prices in the world—as a captive market.
U.S. law restricts the importation of commercial quantities of prescription medication except by the manufacturer, but it declares a permissive policy on personal importation of up to a 90-day personal supply. The complaint alleges that the defendants nevertheless spend vast sums of money on misinformation campaigns that claim ordering prescription medicines from international pharmacies is either unsafe, illegal, or both.
According to the complaint, the defendants accomplished their scheme by using blacklists that they created, which are in turn used by Internet gatekeepers to deprive those on the list of key resources such as paid advertising, search engine rankings, payment processing, and shipping. The blacklists are primarily used to cut off international pharmacies, but more recently they have been used to cut off companies like PharmacyChecker.com.
PharmacyChecker.com is not a pharmacy. It is an independent pharmacy verification company that accredits safe online pharmacies if they pass a rigorous verification process. In fact, it is a direct competitor of two of the defendants (NABP and LegitScript), which also provide verification services but will not accredit pharmacies outside the United States that sell to patients in the United States. PharmacyChecker.com verifies both U.S. and foreign pharmacies.
PharmacyChecker.com’s verification services ensure that consumers have access to affordable medicine dispensed by a legitimate, regulated pharmacy. PharmacyChecker.com also lists comparative drug pricing information from accredited pharmacies so consumers can obtain their medication at the most competitive price available from both foreign and domestic pharmacies.
PharmacyChecker.com therefore promotes the type of competition the defendants and their constituent members are trying to prevent: competition from legitimate international pharmacies, whose prices are much lower. As a result, the complaint alleges, the defendants also sought to wipe PharmacyChecker.com from the consumer-facing internet to make it harder for consumers to find information about international pharmacies or their lower prices.
After PharmacyChecker.com was added to the list, it lost most of its top rankings in Google searches, and its search results on Bing have a pop-up warning that tells consumers to stay away and suggests that PharmacyChecker.com is an untrustworthy site. As a result of this group boycott, PharmacyChecker.com alleges it has lost substantial web traffic, effectively excluding it from the market.
PharmacyChecker.com also filed a motion for preliminary injunction with its complaint to prevent the defendants from continuing to use their blacklist against PharmacyChecker.com while the litigation is pending. The court has ordered the defendants to show cause why the injunction should not be issued at a hearing scheduled for September 11, 2019.
In addition to a preliminary injunction, PharmacyChecker.com seeks trebled damages, a permanent injunction against the defendants’ anticompetitive conduct, and attorneys’ fees and costs.
The case, PharmacyChecker.com v. National Association of Boards of Pharmacy et al., No. 19-cv-07577-KMK (S.D.N.Y.), has been assigned to U.S. District Judge Kenneth M. Karas at the White Plains Division of the U.S. District Court for the Southern District of New York.