Tuesday, March 26, 2013

Court: Can drug companies pay to delay generics?

FILE - In a Jan. 7, 2008, file photo then-Attorney Donald Verrilli talks to media outside the Supreme Court. Now President Barack Obama's top Supreme Court lawyer, Solicitor General Verilli will argue before the Supreme Court this week whether it is legal for patent-holding pharmaceutical companies to pay rivals, who make generic drugs, to temporarily keep those cheaper versions of their brand-name drugs off the market. The Obama administration is taking the position that the agreements are illegal if they?re based solely on keeping the generic drug out of consumer's hands. (AP Photo/Evan Vucci, File)

FILE - In a Jan. 7, 2008, file photo then-Attorney Donald Verrilli talks to media outside the Supreme Court. Now President Barack Obama's top Supreme Court lawyer, Solicitor General Verilli will argue before the Supreme Court this week whether it is legal for patent-holding pharmaceutical companies to pay rivals, who make generic drugs, to temporarily keep those cheaper versions of their brand-name drugs off the market. The Obama administration is taking the position that the agreements are illegal if they?re based solely on keeping the generic drug out of consumer's hands. (AP Photo/Evan Vucci, File)

FILE - In this Aug. 12, 2011 file photo, Jeremy Lazarus, president-elect of the American Medical Association (AMA) speaks in Portland, Oregon. The Supreme Court will struggle this week with whether it?s legal for patent-holding pharmaceutical companies to pay rivals, who make generic drugs, to temporarily keep those cheaper versions of their brand-name drugs off the market. Now AMA President, Lazarus said in a statement,"The AMA believes that pay-for-delay agreements undermine the balance between spurring innovation through the patent system and fostering competition through the development of generic drugs. Pay for delay must stop to ensure the most cost-effective treatment options are available to patients." (AP Photo/Rick Bowmer, File)

This March 2011 photo provided Actavis Inc. shows Actavis CEO Paul Bisario at the pharmaceutical company's corporate headquarters in Parsippany, N.J. On Monday, March 25, 2013, the U.S. Supreme Court is scheduled to hear arguments of pharmaceutical company interests in recouping billions of dollars spent developing new drugs pitted against the government's desire to get cheaper generic drugs on the market earlier to save American consumers money. "By doing what the FTC wants, you're going to hurt consumers rather than help them," said Bisaro. Fighting between generic and brand-name drugmakers in court is risky and time consuming, he said, while settlements bring certainty, allow generic drug sales years before patents expire and reduce legal costs. (AP Photo/Actavis, Maryanne Russell)

WASHINGTON (AP) ? The Supreme Court is considering whether drug companies should be allowed to pay generic drugmakers to keep lower-priced versions off the market for a while.

Justices will hear arguments Monday from federal officials trying to outlaw so-called "pay-for-delay" deals. That's when a brand-name drugmaker pays a generic drugmaker challenging its drug patent to settle and launch a generic version on an agreed-upon date.

Federal officials, consumer and doctor groups say those deals cost American taxpayers $3.5 billion annually by delaying the launch of cheaper generics.

Drugmakers and their supporters argue that these deals save them litigation costs and often bring generics to market faster. They say generic drugs saved American patients, taxpayers and the health care system an estimated $193 billion in 2011 alone.

The court will rule before summer.

Associated Press

Source: http://hosted2.ap.org/apdefault/f70471f764144b2fab526d39972d37b3/Article_2013-03-24-Supreme%20Court-Pay%20For%20Delaying%20Generics/id-58ff0fa9c6b64d549a98f4652f138e11

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