Delaying Generic Drugs: Pay-for-Delay May No Longer Be an Option

A shifty practice perpetrated by drug companies is delaying the release of cheaper generic drugs so as to maximize the returns on higher priced name brands.

These deals are a squicky handshake between major pharmaceutical companies and generic drug companies, and they’re one of the contributing factors to the high price of healthcare in this country.

Or, rather, was one of the factors. According to ModernHealthcare.com: “The U.S. Supreme Court ruled today that the Federal Trade Commission can proceed with its “pay-for-delay” case, which argues that pharmaceutical manufacturers illegally restrict competition by reaching deals with generic drug companies to keep cheaper versions of drugs off the market.”

This is not an entirely done deal of course. At this level, the game is complicated: “Although the anticompetitive effects of the reverse settlement agreement might fall within the scope of the exclusionary potential of Solvay’s patent, this does not immunize the agreement from antitrust attack,” the opinion from the 11th U.S. Circuit Court of Appeals in Atlanta said.

The Solvay in this case is Solvay Pharmaceuticals (now known as AbbVie Products, a subsidiary of Abbott Laboratories), and they’re a maker of testosterone. Actually, we’re all makers of testosterone; Solvay manufactures a synthetic kind that it sells for a lot of dollars. When other companies tried to distribute a generic version of Solvay’s topical testosterone gel, the company offered them cash in exchange for waiting — and that’s when the 11th I.S. Circuit Court of Appeals stepped in.

It’s a breaking case. As more info is released, we’ll update you.