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Decision to dismiss antitrust suit filed by FTC applauded.

ARLINGTON, Va. -- The Generic Pharmaceutical Association (GPhA) has expressed support of a recent federal court decision to dismiss an antitrust lawsuit by the Federal Trade Commission that alleged that Solvay Pharmaceuticals Inc. conspired with generic drug manufacturers to postpone generic competition for AndroGel, its leading testosterone-replacement drug.

"This decision, along with several other prior court decisions in similar suits brought by the FTC, reaffirms the pro-competitive and pro-consumer nature of patent settlements," emphasizes GPhA president and chief executive officer Kathleen Jaeger. "The decision further demonstrates that the existing authority of the FTC to review patent settlements and contest those that they deem to be anti-competitive adequately protects consumers."

Jaeger adds that GPhA has been fighting to derail proposed legislation aimed at restricting all pharmaceutical patent litigation settlement agreements. "New legislation is unnecessary, ill-founded and anti-consumer," Jaeger remarks. "Patent settlements have proven to provide date-certain generics entry that is prior to patent expiry, which saves consumers and the health care system billions of dollars each year."

She cites a recent independently conducted study by RBC Capital Markets which found that of the more than 370 drug patent cases filed between 2000 and 2009, generics were able to launch their lower-cost products before brand patents expired in just 48% of the cases that went to trial.

However, by including those cases in which a settlement was reached, generic products were brought to market prior to patent expiry in 76% of the cases.

That report also showed that of the 37 new generic drugs expected to be launched this year and in 2011, 24 launches result from settlements and will be on the market before brand patent expiration.

The recent Androgel decision stemmed from the FTC claim that Solvay entered into an illegal agreement with Watson Pharmaceuticals Inc. and Par Pharmaceutical Cos. that would delay the launch of a generic equivalent to AndroGel.

Jaeger, notes, however, that the settlement actually enables the launch of the generic in 2015--five years before the Androgel patent expires in August of 2020.

A U.S. District Court judge in Atlanta dismissed the FTC's challenge, ruling that the agency had no case against the settlement among the companies. In rejecting the FTC's position, the court cited previous judicial rulings that allowed settlements similar to the one reached by the drug makers in this case.

The ruling is a setback in the FTC's ongoing campaign against pharmaceutical patent settlements that it says delay the entry of generic drugs.

FFC Chairman Jon Leibowitz has cited the AndroGel case during his push for legislation to ban so-called pay-for-delay settlements. President Obama's recently released health care proposal also includes such a ban.

The FTC said that Solvay, faced with the prospect of plummeting sales if the generics entered the market, paid the companies a share of its AndroGel profits in exchange for a promise the generics firms would not introduce a competing drug until 2015. The generics companies also agreed to drop their patent challenge.

The judge's ruling cited previous federal appeals court decisions allowing other settlements similar to the AndroGel deal. One such ruling rejected the FTC's challenge to an agreement between Schering-Plough Corp. (now part of Merck & Co.) and generics companies that delayed competing versions of K-Dur 20, a potassium supplement.

At a press conference earlier this year, Leibowitz said consumers are forced to pay inflated prices or forgo their medication because of pay-for-delay deals and appealed to Congress to adopt a provision as part of the health care reform bill to stop pay-for-delay agreements.

"Pay-for-delay deals are a bad prescription for America: When drug companies agree not to compete, consumers lose," Leibowitz said. "Ending this practice as part of health care reform is one simple, effective and straightforward way to help control drug costs."

At that press conference, Leibowitz also announced that the FFC had issued a new study that summarizes the savings lost to consumers through such deals.
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Title Annotation:RX/Generic Drugs; Generic Pharmaceutical Association
Publication:Chain Drug Review
Date:Mar 15, 2010
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