By Diane Bartz
WASHINGTON, Jan 17 (Reuters) - Brand name pharmaceutical
companies reached agreements with generic manufacturers 40 times
in the past year, delaying the arrival of cheaper drugs to
pharmacists' shelves, the U.S. Federal Trade Commission said on
The agreements were up from 28 a year earlier, even as the
FTC has been on a mission for years to stop the so-called
pay-for-delay deals. The agency said the agreements in fiscal
2012, which ended Sept. 30, involved 31 different brand name
drugs with total U.S. sales of more than $8.3 billion annually.
In the deals, brand name companies settle patent litigation
with potentially infringing generic firms by reaching an
agreement which results in the delay of a generic version of a
drug being delayed.
The 28 agreements in fiscal 2011 were the most since the FTC
started tracking them. In 19 of them, drug companies promised to
withhold their own generic version of the drug in question if
the generic company promised to delay production, the FTC said.
The Generic Pharmaceutical Association defended the patent
settlements as good for consumers since they often result in
generics being released before the patent expires.
"The FTC is continuing to perpetuate the myth that
pro-competitive, pro-consumer patent settlements are harmful to
consumers -- an unsubstantiated position that has repeatedly
failed to receive support in both Congress and the courts,"
Ralph Neas, the GPhA president, said in an emailed statement.
The FTC has sued the companies which made similar deals in
the past, asking them to be overturned, but with mixed success.
Most recently, the U.S. Supreme Court agreed to hear an
appeal by the FTC, which had challenged annual payments of $31
million to $42 million by Solvay Pharmaceuticals Inc, now owned
by Abbott Laboratories, to stop generic versions of AndroGel, a
treatment for the underproduction of testosterone, until 2015.
It also sued Cephalon Inc., accusing it of blocking a
generic version of the no-sleep drug Provigil. The case has been
stayed pending the Supreme Court's decision.
The FTC sued Schering-Plough Corp, later bought by Merck and
Co Inc, because of payments to rivals to delay generic versions
of its potassium supplement K-Dur 20. FTC won an appeal in that
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