Allergan sued for scheming to protect Restasis—and it’s not just about the tribal license

Drug purchasers sued Allergan for alleged illegal moves to extend its Restasis patent protections for years.

Allergan has taken intense heat lately for trying to protect its big-selling Restasis from rivals by licensing patents to a Native American tribe. But according to a new lawsuit, the company's anticompetitive ploys date back several years.

A lawsuit brought against Allergan in the U.S. District Court for the Eastern District of Texas claims Allergan defrauded the U.S. and Patent Trademark Office with "misrepresentations of fact" and that it submitted a wrongful FDA Orange Book listing and wrongful petitions to the agency. Further, the company filed "sham" lawsuits against would-be generic challengers to protect its unlawful patents, the suit contends.

It's a proposed class action suit on behalf of purchasers who say they bought Restasis at "supracompetitive prices" due to the patent tricks. The eye drug's intellectual property shield should have expired in May 2014, the plaintiffs say, which means they overpaid hundreds of millions of dollars for Restasis since then.

And since then, the plaintiffs say, Allergan has reeled in $3.9 billion in Restasis sales.

RELATED: Allergan loses Restasis patent protections in federal court decision

An Allergan representative didn't immediately respond to a request for comment on the lawsuit.

In addition to the other allegations, the plaintiffs also hit out at Allergan's tribal licensing deal, which triggered a firestorm of criticism in recent months. That license allows the Saint Regis Mohawk Tribe to claim sovereign immunity to avoid a patent-office challenge to Restasis patents.

Allergan inked the licensing deal in September, transferring patents to the tribe and licensing them back to dodge the PTO's review process. The new lawsuit argues that, because the U.S. Patent Trial and Appeal Board stood to invalidate the company's patents, Allergan entered the deal to "wrongfully perpetuate" its Restasis monopoly.

Under the deal, the company agreed to pay $13.75 million upfront and up to $15 million per year. Not too long afterward, however, a judge in Texas invalidated the patents in a separate challenge in federal court.

RELATED: Allergan CEO Saunders defends Restasis deal by calling for review of patent challenge process

Allergan has maintained it entered the deal to protect against a "double jeopardy" of patent attacks—at the patent office and in federal court—but that defense hasn't held off its critics. In response to the deal, some lawmakers called for investigations while others started one. Sen. Claire McCaskill introduced a bill to close the "brazen loophole."

The episode dented investor confidence in the company's management, according to analysts, while some market watchers felt the tactic was ingenious and likely to spread to other drugmakers looking to protect their own meds. So far, no other companies have followed the path, and multiple generic companies blasted the deal, along with other prominent healthcare groups.