Bausch Health and Lannett Company have agreed to pay nearly $18 million to resolve allegations that they took part in coordinated efforts to inflate the prices of generic prescription drugs, according to court filings seeking preliminary approval of the settlement.
The agreement, reached with 48 states and U.S. territories, marks another step in a wide-ranging antitrust investigation that has targeted dozens of drug manufacturers and executives accused of manipulating prices, limiting competition and increasing costs for patients and public healthcare systems.
Under the proposed deal, the companies will pay a combined $17.85 million and adopt internal compliance measures aimed at preventing similar conduct in the future. State officials say the settlement also requires both companies to cooperate with ongoing litigation against other pharmaceutical firms that remain defendants in the broader case.
Connecticut Attorney General William Tong, whose office is leading the multistate effort, said the companies’ alleged conduct harmed families and strained government healthcare budgets. He stated that the case focuses on practices that pushed prices higher for medicines that are typically marketed as affordable alternatives to brand-name drugs.
The payment will be split between the two companies, with Bausch contributing just over $4 million and Lannett responsible for roughly $13.5 million, along with an additional $270,000 tied to related corporate entities. States plan to allocate most of the funds toward consumer restitution and reimbursement for public health programs, with the remainder covering legal and administrative costs.
Court documents indicate that about 70% of the settlement proceeds will go to consumers and state entities, and around 30% will cover litigation expenses and case management. Any unused funds may support further legal action against the remaining defendants.
Beyond financial penalties, the settlement imposes operational requirements. Bausch must avoid unlawful pricing agreements and bid-rigging practices for at least four years and conduct annual antitrust training for employees involved in sales, contracting and pricing decisions. Lannett’s agreement extends for 10 years and includes mandatory compliance programs, staff training and restrictions on anti-competitive conduct.
Both companies have also pledged to assist states by providing information and interpreting internal data that may support claims against other firms still facing litigation.
The lawsuits are part of a long-running investigation into the generic drug market. Authorities allege that certain manufacturers communicated with competitors to coordinate price increases and divide markets, actions that prosecutors say reduced competition and kept drug costs artificially high.
The first trial in the broader litigation is expected to begin in late 2026 in Hartford, Connecticut. That case will address claims against several companies and executives who deny wrongdoing.
The multistate actions span three related federal cases filed in the U.S. District Court for the District of Connecticut. Judges have declined requests from defendants to dismiss most of the claims, allowing the litigation to proceed toward trial. Some companies have recently attempted to narrow the scope of the suits or appeal certain rulings.
Earlier settlements with other drugmakers, including Apotex and Heritage Pharmaceuticals, added tens of millions of dollars to the recovery effort. With the latest agreements, states say the combined total available for restitution has grown significantly, with more funds expected if additional settlements are reached.
A third-party administrator, Rust Consulting, will manage the claims process, including notifying eligible consumers and organizations. Huntington Bank is slated to serve as the escrow agent to hold and distribute funds once the court approves the settlement.
Participating jurisdictions include nearly every U.S. state along with several territories and the District of Columbia, reflecting the national scale of the investigation.
Officials have framed the enforcement effort as part of a broader campaign to restore competition to the generic drug market and prevent practices that drive up healthcare costs. They say the focus remains on holding remaining defendants accountable and returning money to patients and taxpayers.
If approved by the court, the settlement with Bausch and Lannett would take effect later this year.
