Jody Godoy

(Reuters) –Teva Pharmaceutical Industries Ltd. has agreed to $420 million in settlement of shareholder litigation. The lawsuit alleged that the company hid a scheme to lower the cost generic drug prices.

In papers filed at Connecticut’s federal court, the settlement was made public on Tuesday. The company has not admitted to any wrongdoing.

Kelley Dougherty from Teva stated that “vast majority” of the settlement would be funded through the company’s insurers.

“This resolution is in the overall best interest of Teva and the patients who continue to rely on us each day for the world’s largest portfolio of generics medicines,” Dougherty said in an email.

Following government scrutiny into allegations of price fixing by large pharmaceutical companies, shareholders had sued the company.

Joseph Fonti (an attorney representing the investors) said that they are pleased with their outstanding results after five years’ worth of litigation preparation and trial preparation.

This agreement must be approved by the judge who is in charge of the case.

In 2020, the U.S. Justice Department filed a lawsuit against Teva alleging that Teva conspired to increase generic drug prices with other competitors. These allegations were denied by Teva.