Should Paying-Off Generics to Delay Launch of Competing Drugs be Prohibited?

by Aaron F. Barkoff



This Wednesday, January 17, at 10 am, the Senate Judiciary Committee will hold a hearing entitled "Paying Off Generics to Prevent Competition with Brand Name Drugs: Should it Be Prohibited?" The hearing is intended to examine the effects of "reverse payment" settlements of Hatch-Waxman litigation, in which an innovator drug company makes a cash payment to a generic drug company, who in return agrees to delay the launch of its generic drug product.

According to the Notice of Full Committee Hearing, those called to testify include:

- Jon Leibowitz, Commissioner of the Federal Trade Commission;
- Billy Tauzin, CEO of PhRMA;
Merril Hirsh, partner at Ross, Dixon, and Bell LLP;
- Bruce Downey, Chairman and CEO of Barr Pharmaceuticals (BRL); and
- Michael Wroblewski of Consumers Union, which publishes Consumer Reports.

Mr. Leibowitz will testify first and will be followed by a panel that includes the other four speakers. In the past, the FTC and consumer groups have vigorously opposed reverse payment settlements. Meanwhile, both innovator and generic drug companies have supported allowing such settlements, arguing they resolve costly litigation on terms acceptable to both sides. The testimony provided at Wednesday's hearing is expected to be posted on the hearing webpage.

The Senate Special Committee on Aging, chaired by Sen. Kohl (D-WI), held a similar hearing last year. Also last year, Senators Kohl, Leahy (D-VT), Grassley (R-IA), and Schumer (D-NY) introduced a bill called the "Preserve Access to Affordable Generics Act," which would have banned reverse payment settlements. Sen. Kohl recently re-introduced that bill and several other bills concerning pharmaceuticals in the new Congress.


(This article was published by BioHealth Investor with permission of Aaron F. Barkoff, author of OrangeBookBlog.com)


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