Consumer class actions follow suits by generic drug makers against brand-name companies.

Generic drug manufacturers have filed lawsuits claiming that brand-name drug makers are trying to keep generics off the market. Now, for the first time, legal and consumer groups are also turning to the courts to fight rising prescription drug prices.

The Prescription Access Litigation Project (PAL)--a coalition of private lawyers, public health advocates, and public interest attorneys--was formed last year by Boston-based nonprofit group Community Catalyst to challenge drug manufacturers' anticompetitive practices that "unfairly and unlawfully maintain artificially high prices" for their prescription drugs.

On April 6, PAL filed a federal antitrust class action in the Southern District of New York, as well as state suits in New York, Florida, and Maine. Plaintiffs in the federal suit include the New York Statewide Senior Action Council, Citizen Action of New York, Consumers for Affordable Health Care Foundation, Health Care for All, and the Massachusetts Senior Action Council.

The federal suit claims violation of [sections] 2 of the Sherman Antitrust Act and alleges that Bristol-Myers Squibb Co. used illegal tactics to maintain a monopoly on the manufacture, distribution, and sales of its antianxiety drug BuSpar (buspirone).

The BuSpar patent was to expire at midnight November 21, 2000, but the day before, Bristol-Myers submitted a new "method of use" patent to the FDA, which lists the patent holders and drugs approved under [sections] 505 of the Food, Drug, and Cosmetic Act in its Orange Book. A new method of using a drug can extend a patent, but this case involved only part of the drug's chemical reaction to being swallowed.

Mylan Pharmaceuticals, Inc., which was ready to ship its generic version, sued the government and Bristol-Myers, alleging that the filing was improper. In March, Judge Ricardo Urbina of the District of Columbia federal court ruled that the BuSpar patent extension was invalid and ordered Bristol-Myers to ask the FDA to delist the patent and give Mylan approval to market its generic version. (Mylan Pharmaceuticals, Inc. v. Thompson, No. CIV. A. 00-2876 (RMU), 2001 WL 273073 (D.D.C. Mar. 13, 2001).) A Bristol-Myers appeal is pending in the U.S. Court of Appeals for the D.C. Circuit.

The PAL class action complaint said the patent filing "misrepresented to the FDA that the patent covers a method of using BuSpar," and that by illegally extending its patent to sell the drug, the company had locked generic competitors out of the market since November 22, 2000.

Since then, consumers and health care providers have paid more for the drug than they would have paid for generics, which usually cost 30 percent to 40 percent less than brand-name drugs. According to PAL calculations, taking into account the FDA-approved effective dose, BuSpar consumers pay about $100 a month out of pocket for their prescriptions. The suit seeks compensation for those who have been overcharged.

"The courts have already said that Bristol-Myers Squibb illegally blocked Mylan from putting a generic on the market. Now Bristol-Myers Squibb owes money to consumers who bought BuSpar in the last five months," said Kim Shellenberger, PAL director.

Other pending class actions filed in U.S. district courts involve the following namebrand drugs: Cardizen CD (diltiazem hydrochloride), Cipro (ciprofloxacin hydrochloride), Hytrin (terazosin hydrochloride), K-Dur 20 (potassium chloride), and Nolvadex (tamoxifen citrate).

The federal government also has concerns about anticompetitive practices by pharmaceutical manufacturers. The Federal Trade Commission (FTC) is preparing a report on how generic drug competition has developed since passage of the Hatch-Waxman Act of 1984, which provides that the FDA cannot give final approval for a generic drug until conflicts with its Orange Book listing have been resolved.

For example, if a patent-holding company sues a generic manufacturer for infringement of an Orange Book listing, the FDA cannot give final approval to the generic for 30 months or until the litigation is over. If the brand-name drug maker's patent is ruled invalid or not infringed, the generic manufacturer that challenged the patent gets exclusive marketing rights for 130 days.

In March, the FTC filed two administrative complaints: one against Abbott Laboratories and Genove Pharmaceuticals for entering into an agreement in which drug patent-holder Abbott would pay Genove to settle infringement suits; the other against Schering-Plough Corp. for paying two generic drug makers up to $90 million to settle an infringement suit involving its blood pressure drug K-Dur 20. Such settlements could keep generic versions of drugs off the market, the FTC said.

In April, the commission issued "special orders" (similar to interrogatories) to 49 companies that make generics and 26 companies that make brand-name drugs to determine whether potentially illegal agreements or settlements exist.