SCOTUS agrees to hear 'pay-for-delay' drug case

Dec 11 2012

The Supreme Court will hear arguments on the legality of drug companies paying their generic-making counterparts to keep generic drugs -- in this case, a testosterone gel -- off the market.

Politico: Supreme Court Takes Up Case On Generic Drugs
The Supreme Court will take up "pay for delay" -- the multibillion-dollar dispute over whether brand-name drug makers should be able to pay generic drug companies for agreeing to delay putting cheaper versions on the market (Norman, 12/10).

Modern Healthcare: Supreme Court Slates Generic Drug 'Pay-For-Delay' Case
The U.S. Supreme Court has agreed to hear arguments in a "pay-for-delay" case that has the Federal Trade Commission accusing generic drugmakers of violating competition laws by agreeing to accept $42 million in annual payments in exchange for not selling generic versions of a more-expensive brand-name testosterone gel. The FTC says the companies -- lead respondent Watson Pharmaceuticals, along with Paddock Laboratories, Par Pharmaceutical Cos. and Abbott Laboratories subsidiary Solvay Pharmaceuticals -- conspired illegally to keep cheaper drugs off the market, to the detriment of consumers of the brand-name drug. The companies, meanwhile, say their actions were legal and immune from FTC scrutiny. However, they did not oppose a hearing before the U.S. Supreme Court, because they said differing interpretations of federal law had led to split legal reasoning in various U.S. circuits on a controversy of national significance (Carlson, 12/8).

Reuters: Supreme Court To Hear "Pay-For-Delay" Drug Case
The Supreme Court agreed on Friday to decide whether brand-name drug companies may pay money to generic drug rivals to keep their lower-priced products off the market, a practice estimated to cost consumers and the government billions of dollars each year. The arrangements, known as "pay-for-delay" or "reverse payments," have for more than a decade vexed antitrust enforcers, including the Federal Trade Commission (FTC), which have been stung until recently by a series of court decisions allowing such practices (Stempel, 12/7).