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Calif. regulator investigating Merck & Co. unit for potential insurance fraud

Merck & Co. Inc. said it received a subpoena from the California Insurance Commissioner's Fraud Liaison Bureau seeking information related to the pricing and promotion of its antibiotic drug Cubicin.

The bureau is investigating whether Merck's Cubist Pharmaceuticals Inc. made false insurance claims for Cubicin.

Merck acquired Cubist in 2015, gaining access to Cubicin, which is used to treat bacterial infections.

Further, the company revealed that a French appeals court ruled in June that Merck & Co. indulged in trademark infringement or unfair competition against Germany's Merck KGaA through certain activities in France.

Merck KGaA had sued the company in France, the U.K., Germany, Switzerland, Mexico and India, alleging breach of the parties' co-existence agreement as well as trademark infringement.

Under a 1955 co-existence agreement, later revised in 1970, Merck & Co. is required to brand itself as MSD outside U.S. and Canada, while Merck KGaA is required to identify itself as EMD in the two markets.