High court to tackle drug pay-for-delay deals

NEWS IN BRIEF — Posted Dec. 17, 2012

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The U.S. Supreme Court has agreed to decide whether so-called pay-for-delay agreements between brand-name and generic drugmakers are legal.

Pay-for-delay deals are patent settlements between drugmakers that involve delaying the introduction of equivalent generics. Critics of the agreements, including the Federal Trade Commission, say the deals violate fair trade and restrict consumer access to low-cost drug alternatives.

Appeals courts have issued conflicting opinions on the deals. In July, for example, the 3rd U.S. Circuit Court of Appeals ruled that pay-for-delay agreements should be presumed illegal. The 11th Circuit and the 2nd U.S. Circuit Courts of Appeals, meanwhile, have held that such deals are fair. In 2011, the Supreme Court declined to hear an appeal brought by more than 30 retail and wholesale drug companies in the 2nd Circuit case.

In its Dec. 7 order, the Supreme Court accepted Federal Trade Commission v. Watson Pharmaceuticals et al. The case involves an FTC challenge to a multimillion-dollar agreement between Watson and Solvay Pharmaceuticals — now owned by Abbott Laboratories — to hold off on releasing generic versions of AndroGel, a treatment for the underproduction of testosterone.

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