First Databank case update

The plaintiffs and First Databank presented a revised class action settlement agreement to the court yesterday in the Average Wholesale Price (AWP)-fixing case. The agreement, if approved by the court, would require First Databank to pay $1 million into a settlement fund for injured consumers. The third party payer (TPP) class, which paid most of the freight, would get bumpkus. The agreement also would require First Databank to adjust the AWP on 1356 national drug codes (NDC) listed in Exhibit A to the third amended complaint. The original settlement agreement provided for a reduction to 8400 NDCs and no settlement fund. First Databank also will pay $160,000 of the plaintiff’s expert expenses plus up to $985,000 in plaintiffs’ attorneys fees.The court also certified a class action against McKesson, the non-settling party in this case. According to the allegations of the complaint, McKesson and First Databank unlawfully agreed to increase the wholesale average cost to AWP markup from 1.20 to 1.25. The court certified a TPP class and a consumer class. The TPP class is certified for damages from 8/1/2001 through 12/31/2003 for the purpose of damages and from 8/1/2001 through 5/15/2005 for the purposes of liability and equitable relief. The consumer class is certified from 8/1/2001 through 5/15/2005 for all purposes. The Court will hear McKesson’s dispositive motion next month.