In a dramatic legal move, J M Smith Corporation has filed a class action lawsuit against pharmaceutical giant Novo Nordisk, accusing the company of orchestrating an elaborate scheme to maintain its monopoly on the diabetes drug Victoza. The complaint was lodged in the United States District Court for the Eastern District of New York on January 23, 2026. The lawsuit targets both Novo Nordisk Inc. and its parent company, Novo Nordisk A/S.
The plaintiff, J M Smith Corporation, operating as Smith Drug Company, claims that Novo Nordisk engaged in anti-competitive practices to unlawfully extend its market dominance over Victoza, a GLP-1 receptor agonist used for managing type 2 diabetes and reducing cardiovascular risks. According to the filing, Novo's actions violated Section 2 of the Sherman Act by preventing generic versions of Victoza from entering the market even after the expiration of relevant patents. The complaint details how Novo allegedly manipulated patent listings in the FDA’s Orange Book and engaged in reverse payment settlements with generic manufacturers like Teva Pharmaceuticals to delay competition.
The crux of Smith Drug's allegations centers around Novo's purported misuse of patent law to block generic competition. In particular, they argue that Novo listed ineligible device patents alongside legitimate ones in the FDA’s Orange Book—a tactic designed to trigger automatic litigation stays under Hatch-Waxman regulations. These stays effectively delayed generic drug approvals by up to 30 months. Moreover, Smith Drug accuses Novo of making an illegal reverse payment settlement with Teva Pharmaceuticals in March 2019. This agreement allegedly involved a "no authorized generic" promise that granted Teva exclusive rights to sell a generic version of Victoza for 180 days post-launch—an arrangement which artificially inflated prices and restricted consumer choice.
Smith Drug seeks substantial relief from the court: threefold damages for overcharges paid due to inflated prices for both brand-name and generic Victoza since February 2023; recovery for overcharges on Ozempic purchases—another GLP-1 drug by Novo—as consumers were shifted away from Victoza during its delayed generic entry; and an injunction against further anticompetitive conduct by Novo. They argue that absent these monopolistic practices, lower-priced generics would have entered the market much earlier, leading to significant cost savings for consumers.
Representing J M Smith Corporation are attorneys from various law firms specializing in antitrust litigation. The case is presided over by judges at the Eastern District Court under Case ID No. 1:26-cv-00420.
Source: 126cv00420_J_M_Smith_Corporation_v_Novo_Nordisk_Inc_Complaint_Eastern_District_New_York.pdf