2 ex-executives of Emcure's US arm accused of price fixing

Jeffrey Glazer and Jason Malek are also charged with rigging bids and price collusion

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Two former executives of the US arm of Pune-based Emcure Pharmaceuticals have been charged in a price collusion case. On Wednesday, the US Department of Justice charged Jeffrey Glazer, former chief executive and Jason Malek, former president of Heritage Pharmaceuticals, in a conspiracy to fix prices of an antibiotic and an anti-diabetes drug. Emcure acquired Heritage Pharmaceuticals in 2011 and the latter also functions as a distribution arm for Emcure in the US.

The criminal charges, which are the first in a two-year long investigation involving 12 companies, including Sun Pharmaceuticals and Dr Reddy’s Laboratories.

Glazer and Malek have also been charged with rigging bids and allocating customers, and are expected to plead guilty to the charges at the next hearing in January, a Bloomberg report said.

The development could spell trouble for Emcure Pharmaceuticals, which started out as a contract manufacturing firm for multinational drugmakers in 1981. But, over the years the privately held company has expanded capabilities and spread footprint in other geographies, including the US, Brazil and Canada.

So far, Heritage Pharmaceuticals has not been charged separately in the price fixing case. The company also appears to have distanced itself from the two former executives who have been accused of price fixing.

In August Glazer and Malek were sacked after an internal investigation revealed misconduct.

"Heritage is fully cooperating with all aspects of the Department of Justice's continuing investigation. Recently Heritage initiated its own legal action against these same individuals (Glazer and Malek) to seek redress for an elaborate embezzlement and self-dealing scheme. Heritage is deeply disappointed by the misconduct and is committed to ensure it does not happen again," the company said in a statement.

From April 2013 to at least December 2015, Glazer and Malek conspired with others in the production and sale of generics including doxycycline hyclate and glyburide, according to the court papers. Sun Pharmaceuticals sells doxycycline in the US but the company has not revealed whether it had revealed subpoenas related to it.