HANOVER TOWNSHIP — Gym Chain 24 Hour Fitness announced that it will close over 100 clubs nationwide, including Hanover Township, as it repositions itself amid coronavirus health and safety restrictions that have proven difficult for the fitness industry.

24 Hour Fitness Worldwide has nearly four million members in its 440 clubs in 14 states; it also laid off an undisclosed number of employees in multiple states via phone call Wednesday, according to The Wall Street Journal.

24 Hour Fitness, 24 Sylvan Way, didn’t even make it to celebrate its one year anniversary. They held a special VIP opening event on Thursday, June 27, 2019. Although a listing shows that the Whippany location is temporarily closed until June 29, 2020, it was reported moving trucks were already removing equipment. An undisclosed source stated they will be moved out by Saturday, June 13.

When arriving at the location the doors were locked and there was a UHaul truck parked.

In addition to the Whippany Super Sport, the following locations in New Jersey are also closing: Piscataway Super Sport; Saddle Brook Sport; Wayne Towne Center Super Sport; Woodbridge Township SS and Hasbrouck Heights Super Sport.

The San Ramon, California based gym chain’s decision to shutter locations comes a year after installing a new CEO, who the company hoped would drive aggressive growth.

“These are painful decisions and we do not take them lightly,” 24 Hour Fitness CEO Tony Ueber said in a statement. “We thank our dedicated, passionate team members for their contributions and impact they have had on helping to change lives every day through fitness.”

PARSIPPANY — Attorney General Gurbir S. Grewal announced that New Jersey and a coalition of other states have filed a lawsuit accusing 26 drug companies of conspiring to artificially inflate the prices of 80 topical generic drugs in violation of federal and state antitrust and consumer protection laws.

Topical drug products are administered by contact – most often with an external body surface. They may include creams, gels, lotions, ointments, shampoos, and solutions.

In addition to the corporate defendants, the complaint filed in U.S. District Court in Connecticut today also names ten individual defendants – drug company executives responsible for sales, marketing, pricing, and operations – who were allegedly involved in the conspiracy.

More than half of the corporate defendants named in the lawsuit are based in New Jersey. Five of the 10 drug company executives named as defendants reside in New Jersey as well.

“The price of many prescription drugs is too high. And our investigations have shown that the high prices for many generic drugs stem from illegal collusion among drug companies and executives,” said Attorney General Grewal. “I’m troubled to see New Jersey companies play such a big role in this outrageous conduct. As I’ve said before, New Jersey’s pharmaceutical industry is the envy of the world. But we can’t turn a blind eye when New Jersey businesses violate our laws and harm our residents just because they are headquartered here.”

In addition to New Jersey, 46 other states, the District of Columbia, Puerto Rico, and several U.S. territories are party to the federal lawsuit.

This is the third time in four years that New Jersey has participated in a multi-state lawsuit alleging anticompetitive conduct in the generic drug industry.

The first lawsuit, which was filed in December 2016 and which New Jersey joined in early 2017, remains pending in U.S. District Court for the Eastern District of Pennsylvania. The case includes 18 corporate defendants and two individual defendants and involves 15 generic drugs.

The second lawsuit was filed in May 2019 in U.S. District Court in Connecticut. It was subsequently transferred to the U.S. District Court for the Eastern District of Pennsylvania, where it remains pending. The second lawsuit accused 20 generic drug companies of conspiring to artificially inflate the prices of more than 100 generic drugs. The products at issue include oral antibiotics, blood thinners, cancer drugs, contraceptives, anti-inflammatory drugs, statins, anti-depressants, medications used to treat HIV, blood pressure medications, and many more.

The complaint filed today alleges that at least from 2009 through early 2016 – and peaking in 2013-2014 – collusion was “rampant” among manufacturers of generic topical drugs.

Sales and pricing executives at generic topical drug companies knew each other well and used their business and personal relationships to collude in restricting competition, allocating customers among themselves, and significantly raising prices on dozens of generic topical drug products, according to the complaint.

The complaint alleges that four of the nation’s largest generic drug manufacturing companies – Taro Pharmaceuticals USA, Inc., Perrigo New York, Inc., Sandoz Inc. (formerly Fougera) and Actavis – led the way with long-standing, collusive agreements to follow each other’s price increases and not compete for each other’s customers.

The 22 other defendant companies named in this lawsuit allegedly “understood the rules of the road” and played the same anti-competitive game.

According to the complaint, the scheme involving topical drugs is part of a broader pattern of anticompetitive conduct that has “permeated every segment” of the generic drug industry for many years, with the goal of avoiding competition that “would normally result in lower prices and greater savings to the ultimate consumer.”

Rather than enter a particular generic drug market by competing on price in order to gain market share, the complaint asserts, companies in the generic drug industry colluded with each other in setting aside a “fair share” of the market for each. This in turn stifled price competition and maintained artificially higher drug prices.

The 80 generic topical drugs referenced in the complaint include a host of commonly-prescribed medications including the local anesthetic lidocaine ointment, the anti-fungal cream clotrimazole 1%, the oral paste triamcinolone (used to treat sores of the mouth) and latanoprost drops, which are used to treat pressure inside the eye caused by glaucoma and other eye diseases.

Collectively, customers of the generic drug manufacturers purchase a vast range of generic topical products in enormous volumes. The profits generated by the drug companies’ alleged conspiracy are significant.

In order to maintain their unlawful agreements, the complaint alleges, executives for the participating drug companies kept in near-constant communication.

Regular telephone and text message conversations were one method for comparing notes and reinforcing their price-fixing arrangements, as were face-to-face conversations at regular industry trade shows, golf outings, posh industry dinners, and conferences.

According to the complaint, high-level executives from many generic drug manufacturers would get together for regular “industry dinners” where they could celebrate – and reaffirm – their commitment to collusive customer allocation and price-fixing tactics.

For example, in January 2014 – when the prices of numerous generic drugs were reportedly soaring – at least 13 high-ranking executives gathered at a steakhouse in Bridgewater. The gathering of CEOs, Presidents, and Senior Vice Presidents of many generic drug manufacturers included executives from defendant companies Actavis, Aurobindo, Lannett, and Perrigo.

A group e-mail discussion of the event quoted in the states’ complaint provides a window into the high living that typically accompanied such outings.

One executive asks if his and his colleague’s meals at the steakhouse will be paid for by a rival executive’s company. The rival executive responds: “It’s amazing how many in the group like 18-year-old single malt scotch when they aren’t buying.”

According to the complaint, the investigating states issued more than 300 subpoenas to various telephone companies, obtaining phone call and text message reports for companies and individuals as part of the investigation.

The states also obtained valuable cooperation from numerous former executives for the defendant companies, the complaint states, including one who kept a two-volume “little black book” of notes chronicling his various collusive dealings with generic drug industry colleagues between 2009 and 2015.

The lawsuit filed today alleges violations of the Sherman Act, a federal antitrust law, as well as violations of numerous state laws, including New Jersey’s Antitrust Act and Consumer Fraud Act. The lawsuit seeks monetary relief and actions by the court to restore competition to the generic topical medications market.

Corporate defendants named in today’s lawsuit include the following, with New Jersey-based companies in bold.

• Actavis Holdco US, Inc., Parsippany
• Actavis Pharma, Inc., Parsippany
• Wockhardt USA LLC, Parsippany
• Actavis Elizabeth LLC, Elizabeth
• Amneal Pharmaceuticals, Inc., Bridgewater
• Amneal Pharmaceuticals LLC, Bridgewater
• Aurobindo Pharma USA, Inc., Dayton
• Bausch Health Americas, Inc., Bridgewater
• Bausch Health US LLC, Bridgewater
• Fougera Pharmaceuticals Inc., Melville, NY
• Glenmark Pharmaceuticals Inc., Mahwah
• Greenstone LLC, North Peapack
• G&W Laboratories, Inc., South Plainfield
• Lannett Company, Inc., Philadelphia, PA
• Lupin Pharmaceuticals, Inc., Baltimore, MD
• Mallinckrodt Inc., Webster Groves, MO
• Mallinckrodt plc, Staines-Upon-Thames, Surrey, UK
• Mallincrockdt, LLC, Hazelwood, MO
• Mylan, Inc., Canonsburg, PA
• Mylan Pharmaceuticals Inc., Morgantown, WV
• Perrigo New York, Inc., Bronx, NY
• Pfizer, Inc., New York, NY
• Sandoz, Inc., Princeton
• Sun Pharmaceutical Industries, Inc., Cranbury
• Taro Pharmaceuticals USA, Inc., Hawthorne, NY
• Teligent, Inc., Buena

Individual defendants named in the complaint include the following, with New Jersey residents in bold:

1. 1. Ara Aprahamian, Bardonia, NY – Director of Pricing and Contracts at
      Actavis from August 2010 through March 2013; and Vice President of Sales
      and Marketing at Taro Pharmaceuticals from March 2013 to August 2018.
   2. Mitchell Blashinsky, Monroe Township – Vice President of Marketing for Generics at Taro from January 2007 through May 2012; and Vice President of Sales and Marketing at Glenmark Pharmaceuticals from June 2012 through March 2014.
   3. Douglas Boothe, Chester – Chief Executive Officer at Actavis from August 2008 through December 2012; and Executive Vice President and General Manager, Pharmaceuticals at Perrigo New York from January 2013 through July 2016.
   4. James (Jim) Grauso, Ramsey, NJ – Vice President of Sales and Marketing at G & W Laboratories from January 2010 through December 2011; Senior Vice President, Commercial Operations at Aurobindo Pharma from December 2011 through January 2014; and Executive Vice President, N.A. Commercial Operations at Glenmark since February 2014.
   5. Walt Kaczmarek, Longboat Key, FL – Senior Director, National Accounts/Vice President, National Accounts/Senior Vice President, Commercial Operations at Fougera from November 2004 through November 2012; and Vice President-General Manager/President Multi-Source Pharmaceuticals at Mallinckrodt from November 2013 through August 2016.
   6. Armando Kellum, Huntington Valley, PA – Vice President, Sales and Marketing at Sandoz.
   7. Kurt Orlofski, Mountain Lakes – President of G&W from September 2009 through December 2016.
   8. Michael Perfetto, Conklin, NY – Vice President, Sales and Marketing at Actavis from August 2003 through January 2013; and Chief Commercial Officer at Taro since January 2013.
   9. Erica Vogel-Baylor, Milford – Vice President, Sales and Marketing at G&W since July 2011.
   10. John Wesolowski, Delton, MI – Senior Vice President of Commercial Operations at Perrigo since February 2004.

Assistant Attorney General Brian F. McDonough and Deputy Attorney General Robert Holup of the Division of Law’s Affirmative Civil Enforcement Practice Group are handling the matter on behalf of the State.

TRENTON – The Administration of Governor Phil Murphy released results of an online survey conducted in conjunction with Rutgers University’s Heldrich Center for Workforce Development earlier this month that drew responses from nearly 4,000 businesses and non-profits across the state.

Results of the survey demonstrate overwhelmingly that while the business and non-profit community is eager to get back to work, owners understand and take seriously the public health risks posed by COVID-19 and the responsibility to provide a safe experience for employees and customers. Many worry about the effect of a possible second wave of the virus.

“This survey verified much of what we anticipated as we began the process of restarting the economy,” said Governor Phil Murphy. “While business owners are eager to get back to work and get their operations back up and running, they remain concerned about consumer and employee confidence and are eager to avoid a second wave of this insidious virus.”

A majority of owners (51%) cited consumer confidence as the most pressing issue, while 13% cited access to personal protective equipment as their biggest concern. Approximately one in 10 said employee confidence would present the biggest challenge to reopening while four in 10 listed employee confidence as one obstacle but not the most pressing one.

Respondents want state government help to reopen safely, particularly guidance on reopening restrictions (60%), guidance on safety measures to keep employees and customers safe (49%), and help in acquiring disinfecting and cleaning products (42%). The majority of respondents (54%) will rely on state/local government and Department of Health guidelines—greater than those who will rely on Centers for Disease Control (23%) and industry and association guidelines (14%).

Customer-facing businesses report that limiting occupancy or reducing capacity of their facilities will be the most difficult challenge.

Other findings from the survey include:
A large majority of business and non-profit owners plan to change their business operations to achieve social distancing, including seven in 10 (70%) who indicate they will re-configure their workplace footprint.

Some businesses (35%) have expanded remote work options in response to the pandemic or are considering it in order to reduce the number of employees at work.

Eight in 10 (79%) businesses in customer-facing industries will require employees to wear facemasks, whether or not the government requires them, and will also provide employees with facemasks to wear while in the workplace (79%).

Seven in 10 (72%) customer-facing businesses will require customers/visitors to wear facemasks, whether or not the government requires them, and four in 10 (40%) of businesses plan to provide them.

Seven in 10 (68%) are concerned with their ability to pay their rent, mortgage, or utilities. Another five in 10 say paying their employees (48%) and paying taxes (47%) are major challenges that their organizations are facing.

“As we make our way through the recovery of our economy, we continue to be mindful of the businesses we know are hurting,” Governor Murphy said. “As our numbers continue to move in the right direction, we will continue to restart our economy in phases while offering financial aid to as many businesses as possible. Together we will emerge from this unprecedented moment in history stronger and more resilient.”

The roughly 4,000 responses from business and non-profit owners or decision makers, collected between May 21st and June 3rd, mirror the New Jersey business community in size and industry composition. Most respondents have less than 10 employees, and most have been in operation for at least 10 years. Half of respondents are from woman- or minority-owned businesses. The survey was conducted in both English and Spanish.

Respondents are evenly distributed across North, Central, and South Jersey and businesses vary across New Jersey sectors. The survey included a non-probability, opt-in sample of respondents and was distributed via dozens of New Jersey industry groups, chambers of commerce, and non-profit organizations.

For the full survey results click here.