NurseWeek

Competition among drug makers investigated

By Noel Holton
Health24News
October 13, 2000


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Washington (H24N). Are generic drug makers and large pharmaceutical companies that manufacture brand-name drugs in bed together?

That is what the Federal Trade Commission (FTC) plans to find out. The agency is looking into claims that some big-name pharmaceutical companies are paying smaller drug firms to keep cheaper, generic versions of their drugs off of the market. The FTC will conduct a focused study to determine whether these companies have used strategies to unfairly delay generic drugs from competing against brand names.

"The goal of this study will be to look at the business relationships between brand-name and generic drug manufacturers to ensure that the process of bringing new, low-cost generic alternatives to the marketplace-and into the hands of consumers-is not impeded in ways that are anticompetitive," said Federal Trade Commission Chairman Robert Pitofsky in a statement.

One of the issues the FTC will examine is whether drug companies have used federal regulations to help block generic competition. The Drug Price Competition and Patent Term Restoration Act of 1984, more commonly referred to as the Hatch-Waxman Act, allows companies to seek approval from the Food and Drug Administration (FDA) to market their generic drugs before the patents on their brand-name equivalents expire.

Once a company seeks FDA approval, the patent holder has 45 days to bring a patent-infringement suit against the generic drug maker. The FDA must then wait for 30 months or until the litigation is over to approve the generic drug. During this time, no other company may file for FDA approval for a generic drug. The first company to seek FDA approval is guaranteed 180 days of exclusive rights to market the drug once the litigation is over.

Back in March, the FTC filed complaints against four drug companies for employing such tactics to delay generic competition.

The first case was against Abbott Laboratories, makers of hypertension and prostate drug Hytrin, and Geneva Pharmaceuticals. Geneva was charged with taking $4.5 million a month from Abbott to keep its generic hypertension and prostate drug off of the market. That case was settled after the companies agreed to discontinue the practice.

The second case involved Aventis' hypertension and angina drug Cardizem CD. The FTC charged Aventis with paying the Andrx Corp. $10 million per quarter, following the FDA's 1998 approval of its generic hypertension and angina drug, to keep it off of the market. That complaint is scheduled to be heard before an administrative law judge later this year.

The FTC recently confirmed that it is also investigating the possibility of similar anticompetitive behavior between the Bristol-Myers Squibb Corp. and American Bioscience, concerning Bristol-Myers' breast cancer drug Taxol.

At stake for patent-holding drug companies is about $20 billion in U.S. pharmaceutical sales over the next five years, Pitofsky said, as many brand-name drug patents are due to expire.

The FTC is required to get public comment before it may begin its study. It must also send information request forms to 30 manufacturers of brand-name drugs, and 60 manufacturers of generics. Written comments should be submitted to the Federal Trade Commission Secretary at 600 Pennsylvania Ave., N.W., Room H-159; Washington, D.C. 20580. Comments may also be sent by electronically to the FTC.