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Deals to keep generics off market at issue

July 26, 2012 at 11:22 PM
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NEW YORK, July 26 (UPI) -- A case involving an agreement to keep a low-priced generic copy of a drug off the market may be headed for the U.S. Supreme Court, an anti-trust expert says.

Eleanor M. Fox, a professor at the New York University law school, said a ruling by a federal appeals court in Philadelphia that the agreement is anti-competitive conflicts with at least three other federal appeals court rulings, The New York Times reported Thursday.

Fox said if the Supreme Court accepts the case within the next few years, the stakes would be enormous for brand-name drug makers -- which would have lower profits -- while pharmacies, insurance companies and patients might have savings.

At issue is a 1984 law that made it easier for generic drugs to gain U.S. Food and Drug Administration approval and a 2003 amendment requiring branded and generic drug makers that entered into patent settlements to file their agreements with the U.S. government, the Times said.

A generic-drug maker that derived the chemical equivalent of a patented branded drug would argue with the FDA that the patent was invalid, Fox said.

The branded company would often choose to make a payment to the generic company rather than spend years and millions of dollars defending its patent. Sometimes the branded company let the generic company market an "authorized" generic version, Fox said.

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