Teva Pharmaceutical (TEVA) - Get Teva Pharmaceutical Industries Limited Sponsored ADR Report shares were lower after a report said U.S. prosecutors are preparing to charge the drugmaker with conspiring with competitors to raise prices for generic drugs.
The Department of Justice could charge Teva as soon as Tuesday after the company rejected a settlement offer, Bloomberg reported. That deal would have required the company to pay a criminal penalty and admit to wrongdoing, sources told the news service.
Teva American depositary receipts at last check were down 2% to $9.44.
Three weeks ago, Bloomberg quoted Teva Chief Executive Kare Schultz as saying: "We did not participate in organized price-fixing, There is no evidence of anything like that."
Five other companies have settled price-fixing charges and agreed to pay a total of $426 million in criminal penalties.
Taro Pharmaceuticals agreed to pay a $205.7 million penalty in July while Rising Pharmaceuticals and Heritage Pharmaceuticals agreed to deferred prosecution agreements last year as part of the DoJ's multiyear investigation into price fixing.
In June, the DoJ indicted Glenmark Pharmaceuticals for collecting $200 million in overcharges for its cholesterol treatment through illegal cartel agreements.
Glenmark also said it would fight the charges.
Tuesday's report comes about a week after news that the U.S. government was suing the Israel-based generic-drug maker for allegedly paying kickbacks for its multiple sclerosis drug Copaxone, which allegedly led to false Medicare claims.
Authorities claim that Teva gave two independent charitable foundations more than $300 million for Medicare co-payments of Copaxone patients.
Teva allegedly shielded patients from a 300% surge in Copaxone's price through the use of the foundations, in turn creating hundreds of millions of dollars of false claims and a matching amount of revenue for the company.