Generic-drug stocks slammed by report of expanded price-fixing probe - (MarketWatch via NewsPoints Desk)

  • Shares in a number of generic drugmakers fell after a report that a probe into price fixing in the sector had been expanded, MarketWatch reported Monday.

  • Connecticut Assistant Attorney General Joseph Nielsen announced that the investigation had been expanded to include at least 16 companies and 300 drugs.

  • The report also revealed that two former Heritage Pharmaceuticals have pleaded to federal criminal charges, adding that they are cooperating with the probe.

  • Bernstein Ronny Gal noted that although the report indicates some risk to companies, it did not include much unknown information but cautioned that it could be a sign that "something more is brewing."

  • "Considering this additional evidence has been building, I find it very interesting that the article wasn't more specific," added Evercore analyst Umer Raffat.

  • Other drugmakers named in the investigation include Abbott, Dr. Reddy's Laboratories, Endo International's Par Pharmaceuticals unit, Lannett, Mylan, Novartis' Sandoz unit, Pfizer, Sun Pharmaceutical and Teva.

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