Deals prevent marketing of generic drugs
WASHINGTON (AP) -- Brand-name pharmaceutical companies have resumed paying generic drug manufacturers to stay off the market under terms of legal settlements, attracting renewed scrutiny from federal regulators, trade officials said Monday.
For the first time since 1999, brand-name and generic drug makers are entering patent challenge agreements under which the latter companies receive compensation in exchange for agreeing to restrictions on their ability to market generic versions of branded drugs.
Consumers usually save money if they can buy generic brands of drugs, which spark price competition. Keeping generic competitors off the market allows brand-name manufacturers to charge premium prices.
Three such settlements were reached in the 12 months ending Sept. 30, 2005, according to a Federal Trade Commission report issued Monday. Roughly six similar deals have been struck in the months since then, FTC Commissioner Jon Leibowitz said.
Pharmaceutical companies ceased striking such agreements in the late 1990s after several legal challenges were mounted by the FTC, Leibowitz said.
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