April 07, 2023
On Thursday, March 30, 2023, the U.S. District Court for the Southern District of New York granted summary judgment in favor of Cravath client Viatris (formed in 2020 from a combination of Mylan and Pfizer’s Upjohn division). The shareholder class action asserted numerous violations of the federal securities laws, all premised on other allegations related to Mylan’s marketing, pricing and classification of EpiPen as well as alleged conduct concerning generic drug price fixing and market allocation.
Mylan moved for summary judgment on all claims for failure to substantiate falsity, scienter and loss causation in September 2021. Class Plaintiffs cross‑moved for summary judgment on certain of their classification‑based claims.
In granting Mylan’s motion, the Court held that Class Plaintiffs failed to demonstrate a triable issue of fact with respect to any of the three categories of claims. With respect to the allegations relating to the marketing and pricing of EpiPen, the Court found that “Plaintiffs fail to establish a sufficiently substantial impact on competition” and “the record is insufficient to permit a reasonable juror to conclude that there was substantial foreclosure” of competition in the epinephrine auto‑injector market, or “that Mylan consciously or recklessly misled shareholders about its own self‑perception of compliance with the antitrust laws.”
With respect to the allegations relating to EpiPen’s classification, the Court found “[t]here is no evidence in the record to sustain a reasonable inference that Mylan knew EpiPen was erroneously classified and misled its shareholders despite this.” The Court further found that the company “acted reasonably in its reliance on CMS [Centers for Medicare and Medicaid Services] statements and other communications in determining how to rebate the EpiPen” and “there is no reasonable basis in the record to conclude” that the government disagreed with EpiPen’s classification for rebating purposes.
With respect to the allegations concerning generic drug price fixing and market allocation, the Court found that Class Plaintiffs failed to present adequate evidence to support their claims, and failed to address “what economic rationality entails in the generic drug market.” The Court credited Mylan’s explanations that its actions were consistent with oligopolistic conduct and the “industrial standard.”
This decision represents one of the few resolutions of a federal securities fraud litigation at summary judgment entirely in favor of defendants.
The Cravath team included partners David R. Marriott, who argued the motion, Kevin J. Orsini and Rory A. Leraris and associates Nicole D. Valente, Hannah Dwyer, Maylynn Chen, Wendy Serra and Chanel C. Thomas.
The case is In re Mylan N.V. Securities Litigation, No. 16‑cv‑7926.
Deals & Cases
October 02, 2023
On October 1, 2023, Viatris Inc. (“Viatris”), a global healthcare company, announced it has received an offer for the divestiture of substantially all of its Over-the-Counter (“OTC”) business, and has entered into definitive agreements to divest its Women’s Healthcare business, its Active Pharmaceutical Ingredient (“API”) business in India and commercialization rights in certain non-core markets that were acquired as part of the combination with Upjohn. The total transactions value, including Viatris’s 2022 divestiture of its biosimilars business, represents up to $6.94 billion of total gross proceeds. The estimated transaction value for the divestitures announced today is $3.6 billion, including gross consideration of up to approximately $2.17 billion for the divestiture of substantially all of its OTC business, and up to approximately $1.2 billion combined for the divestitures of its API and Women’s Healthcare businesses. Cravath is representing Viatris in connection with the transactions.
Deals & Cases
November 07, 2022
On November 7, 2022, Viatris Inc. (“Viatris”), a global healthcare company, announced it intends to create an ophthalmology franchise by acquiring Oyster Point Pharma (“Oyster Point”) and Famy Life Sciences.
Deals & Cases
February 28, 2022
On February 28, 2022, Viatris Inc. (“Viatris”) announced that it reached a definitive agreement with Biocon Biologics Limited (“Biocon Biologics”) to contribute its biosimilars portfolio to Biocon Biologics, which will become a uniquely positioned, vertically integrated company expected to be a global biosimilars leader. Under the terms of the agreement, Viatris will contribute to Biocon Biologics its biosimilars portfolio and related commercial and operational capabilities, amounting to 2022 estimated revenue of approximately $875 million and 2022 estimated adjusted EBITDA of approximately $200 million, in exchange for pre-tax consideration of up to $3.335 billion, which represents a transaction multiple of 16.5x of estimated 2022 biosimilars adjusted EBITDA. Cravath is representing Viatris in connection with the transaction.
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