The Federal Trade Commission says the so-called pay-for-delay deals violate antitrust law, preserve monopolies and artificially jack up prices, the Los Angeles Times said Saturday.
The commission said 28 such agreements cost consumers and taxpayers at least $3.5 billion in 2011, the newspaper reported.
"When drug companies agree not to compete, consumers lose," FTC Chairman Jon Leibowitz said.
Federal courts have upheld such deals in a number of cases, finding they constitute settlements of patent disputes.
The Supreme Court said Friday it would consider a case involving an agreement in which Solvay Pharmaceuticals Inc., which makes the testosterone booster AndroGel, agreed to pay Watson Pharmaceuticals Inc. more than $19 million a year in return for Watson's agreement to hold a competitive drug off the market until 2015.
Megyn Kelly: Santa Claus and Jesus are both white men
Costly malfunction causes beer flood at Boston-area brewery