Lannett Accused of Colluding With its Peers to Fix Generic Drug Prices

Investors of Lannett (NYSE: LCI) filed a securities class action complaint against the company's officers and directors for alleged violations of the Securities Exchange Act of 1934 between May 9, 2013 and November 3, 2016. According to the complaint, Lannett conspired with its industry peers to fix the prices of at least four of the company's generic drugs in order to reap higher profits and secure the financing needed to make a series of massive acquisitions. The extent of Lannett's fraud was first revealed on July 16, 2014, when Lannett disclosed that it received an inquiry from the Connecticut Attorney General regarding its pricing of Digoxin. Lannett officials maintained that the company had done nothing wrong while Lannett continued to become the focus of multiple government investigations. On November 3, 2016, Bloomberg reported that Lannett was being investigated by the U.S. Department of Justice for suspected price collusion, causing the company's stock to fall to $17.25 per share that day. Lannett's stock has yet to recover to its class period high of $71.15 per share.