The Federal Trade Commission (FTC) may now have the right to challenge pay-for-delay deals, but that doesn't mean there's no other way for drugmakers to stall the launches of competing generic products. And that's exactly what a group of healthcare purchasing companies is accusing Novo Nordisk ($NVO) of doing to copies of its diabetes drug Prandin.
As Reuters reports, American Sales, Rochester Drug Co-op and Cardinal Health have sued the Danish pharma, alleging that it wrongfully kept Prandin generics off the market. They're claiming compensation for the delay, though just how much is undisclosed. Novo aims to get the case dismissed, a spokesman told the news service.
The purchasing companies take issue with Novo's 2005 patent infringement lawsuit against Caraco Pharmaceutical Laboratories, a subsidiary of India's Sun Pharma. Novo sued after Sun applied to get its generic version of Prandin approved by 2009, when Novo's patent was set to expire. The Danish drugmaker finally lost the suit last summer, compromising Prandin's $200 million to $250 million in yearly revenues.
Other drugmakers have met with similar litigation. Late in 2012, GlaxoSmithKline ($GSK) reached a $150 million settlement with a group of wholesalers--Cardinal included--that claimed the company abused FDA rules to maintain exclusivity on blockbuster nasal spray Flonase. A class action from June of that year pitted Flonase users against Glaxo; they claimed they had overpaid while GSK exercised "sham" delay tactics.
June's Supreme Court ruling on pay-for-delay deals, in which pharma companies pay generics makers to hold off on releasing their copies, has also changed the rules for litigating those cases, and since then new lawsuits have sprung up around the country. A Puerto Rican wholesaler recently sued Endo ($ENDP) for an alleged settlement with Actavis ($ACT) over Lidoderm; another suit allowed insurance companies and union health plans to join up in a class action against AstraZeneca ($AZN), Teva ($TEVA), Dr. Reddy's and Ranbaxy over Nexium generics.
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