AstraZeneca faces suit from AFL-CIO, Boston-based consumer advocate.

Byline: Christopher Rowland

Oct. 19--The AFL-CIO and a Boston-based consumer advocacy group sued AstraZeneca yesterday, accusing the drug manufacturer of deceptively selling doctors and patients on the idea that Nexium, the nation's most heavily advertised prescription drug, is an improved purple pill.

The lawsuit filed in Los Angeles alleges that when AstraZeneca faced expiration of its patent on Prilosec in 2001, it launched a concerted effort to protect its anti-heartburn prescription franchise by dressing up the old drug with a new name.

In reality, the suit says, Americans who buy Nexium are getting virtually the same drug as Prilosec, just in a higher dose. AstraZeneca reported $3.3 billion in Nexium sales in 2003, driven by what TNS Media Intelligence/CMR has tracked as $250 million worth of TV and magazine ads annually.

"They flooded doctors' offices with Nexium information and they told doctors it was more powerful. They gave them tons of free samples," said Steve Berman, a lead attorney in the case, which is also being launched in Massachusetts. "They priced the drug below the cost of Prilosec at that point in time, and once people got hooked, they raised the price."

Prescription Nexium costs about $4 a pill, he said, while non-prescription Prilosec, which is now sold over the counter, and generic versions cost about 46 cents a pill. The California Alliance of Retired Americans, a union-affiliated organization that joined in the suit, called AstraZeneca's tactics a "massive bait and switch."

Plaintiffs said they filed the suit in a bid to reign in skyrocketing healthcare costs. The lawsuit seeks refunds for patients who purchased Nexium, which the plaintiffs estimate could amount to $1 billion or more in California alone. A second case is expected to be filed in Massachusetts this year.