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Post date: April 24 2003

$55 Million Settlement In Taxol Case Filed With The Court

Attorney General Spitzer today announced a settlement in the federal antitrust lawsuit brought against Bristol-Myers Squibb involving the cancer-fighting drug Taxol. The lawsuit, filed by all 50 states, Puerto Rico and other U.S. territories in 2002, alleged that the drug manufacturer unlawfully blocked less expensive generic drugs from entering the marketplace. In today's filing in federal court in Washington D.C., the Attorney General is seeking court approval to begin the formal notice and claims process.

"We are pleased that this settlement will compensate New Yorkers and the state for overpaying for this drug," Spitzer said. "The case shows we will hold drug companies accountable when they attempt to unlawfully block generic competitors from the market."

New York consumers, state hospitals and other state purchasers of Taxol will share in the $55 million settlement, which requires the approval of U.S. District Court Judge Emmet G. Sullivan to become effective. Upon approval, the State will receive a substantial recovery for certain government entities that purchased Taxol or its generic equivalent. While the final distribution among the litigating states has not yet been determined, more than $37 million will be set aside for this purpose.

The settlement agreement contains strong injunctive relief which prevents Bristol Myers-Squibb from engaging in future anti-competitive conduct. Bristol-Myers Squibb has further agreed to provide free quantities of Taxol to DEA-approved health care facilities, which will make the drug available to individuals who meet certain eligibility requirements.

The claims process will enable individuals who purchased Taxol or its generic equivalent between January 1, 1999 and February 28, 2003 to recover for overcharges. Approximately $12 million has been set aside for this nationwide consumer distribution. The remainder of the settlement will be used to pay administrative costs and attorneys' fees to the states.

New York was one of a group of states leading the investigation that preceded the filing of the federal court action in Washington, D.C.

The litigation was handled for New York by Richard L. Schwartz and John A. Ioannou, Assistant Attorneys General in the Antitrust Bureau, and Hampton S.C. Finer, the Bureau's Director of Economics.