Teva settles generic ‘pay-to-delay’ case for $1.2 billion
pharmafile | May 29, 2015 | News story | Sales and Marketing | Cephalon, FTC, Teva, modafinil, provigil
Teva Pharmaceuticals has agreed to a $1.2 billion settlement for paying generic drug makers to delay challenging the patent for its sleep disorder drug Provigil.
The settlement is thought to include the $512 million that Teva agreed to pay in April – to settle legal action from drug purchasers that lost out while the company paid competitors to delay the launch of their generic versions of Provigil (modafinil).
Provigil is produced by its subsidiary Cephalon and the US Federal Trade Commission (FTC) first brought action against the firm in 2008 – before it was acquired by Teva for $6.8 billion in 2011. Teva is alleged to have paid generic manufacturers hundreds of millions of dollars to wait until 2012 to sell generic versions of Provigil.
The multi-billion dollar settlement, which came down right before a trial was set to begin on 1 June, will be paid to compensate purchasers, wholesalers, pharmacies and health insurers.
Teva, the world’s largest producer of generic drugs, will also enter into a legally binding agreement with the US government that will prevent it from making similar deals with other generic companies – but which does not require an admission of liability.
By doing so the FTC has now moved to close what many saw as a legal loophole that allowed pharma companies to continue ‘anticompetitive’ practices long after the patents for their drugs had expired.
“The FTC has been very committed to putting a stop to these kinds of deals,” says FTC chair Edith Ramirez. “There’s no question that pharmaceutical companies have gotten very creative in the way they try to get around the antitrust laws. We’re going to continue our fight.”
Ramirez adds: “This is the largest settlement in FTC history for this type of case. That’s a big sum and I think that will send a very strong signal to any company that is contemplating entering into any type of deal that is anticompetitive.”
Teva spokesperson Denise Bradley says: “We are pleased to have reached an agreement with the government. This is the right path for our company, for the industry and for the patients we serve.”
Lilian Anekwe
Related Content
Teva’s Ajovy significantly reduces migraine in children and adolescents
Teva’s Ajovy (fremanezumab) has demonstrated significant reduction in monthly migraine and headache days in children …
Teva announces positive results from trial of AJOVY for migraine
Teva has announced positive results from the phase 4 PEARL study of AJOVY (fremanezumab), its …
Sanofi and Teva partner for development of inflammatory bowel disease treatment
Sanofi and Teva Pharmaceuticals have announced that they will collaborate for the co-development and co-commercialisation …
