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Healthy Skepticism Library item: 15872

Warning: This library includes all items relevant to health product marketing that we are aware of regardless of quality. Often we do not agree with all or part of the contents.

 

Publication type: news

Wang SS.
‘Pay-for-Delay’ Deals Cost Consumers $3.5 Billion a Year
The Wall Street Journal Blog 2009 Jun 23
http://blogs.wsj.com/health/2009/06/23/pay-for-delay-lawsuits-cost-consumers-35-billion-a-year/


Full text:

Ending settlements in which branded drug makers pay generic ones to delay entry into the market, known as “pay-for-delay” settlements, would save consumers $3.5 billion a year, plus “significant savings” for the federal government, according to Federal Trade Commission Chairman Jon Leibowitz.

In his speech to the Center for American Progress today, Leibowitz said that stopping such deals is an FTC priority and urged Congress to pass legislation to ban or limit such patent settlements, which the agency believes to be anticompetitive.

Yesterday, the Supreme Court declined to hear such a case involving the nearly $400 million Bayer paid to Barr and other companies to keep generic versions of its antibiotic Cipro off the market until Bayer’s patent expired.

These types of settlements can be lucrative for both parties. For instance, Pfizer will reap billions in additional revenue for settling its fight with Ranbaxy over Lipitor. The two companies agreed Ranbaxy could start selling the cholesterol drug in late 2011, rather than in 2010, which Ranbaxy was pushing for. Ranbaxy, in return, gets six-month head start of being the only generic atorvastatin on the market.

“From my perspective,” Leibowitz said, “the decision about whether to restrict pay-for-delay settlements should be simple.” He continued:

On the one hand, you have savings to American consumers of $35 billion or more over 10 years – about $12 billion of which would be savings to the federal government – and the prospect of helping to pay for health care reform as well as the ability to set a clear national standard to stop anticompetitive conduct. On the other hand, you have a permissive legal regime that allows competitors to make collusive deals on the backs of consumers.

 

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Far too large a section of the treatment of disease is to-day controlled by the big manufacturing pharmacists, who have enslaved us in a plausible pseudo-science...
The blind faith which some men have in medicines illustrates too often the greatest of all human capacities - the capacity for self deception...
Some one will say, Is this all your science has to tell us? Is this the outcome of decades of good clinical work, of patient study of the disease, of anxious trial in such good faith of so many drugs? Give us back the childlike trust of the fathers in antimony and in the lancet rather than this cold nihilism. Not at all! Let us accept the truth, however unpleasant it may be, and with the death rate staring us in the face, let us not be deceived with vain fancies...
we need a stern, iconoclastic spirit which leads, not to nihilism, but to an active skepticism - not the passive skepticism, born of despair, but the active skepticism born of a knowledge that recognizes its limitations and knows full well that only in this attitude of mind can true progress be made.
- William Osler 1909