AbbVie inks $54M settlement to resolve Namenda 'pay-for-delay' lawsuit

A protracted legal fight over an alleged "pay-for-delay" deal on AbbVie's Alzheimer's disease drug Namenda may be nearing its end as the sides have reached a preliminary settlement.

The Illinois-based pharma giant agreed to pay $54.4 million to settle a 2015 class action lawsuit filed by health plans who said they overpaid for Namenda because of a 2010 settlement that allowed Forest Laboratories, now a part of AbbVie, to hold off generic competition to the drug until 2015. Forest signed that deal with Germany's Merz Pharma.

Years later, insurers and health plans called foul, alleging anticompetitive conduct. Now, the U.S. District Court for the Southern District of New York has granted its preliminary approval of the settlement.

This isn’t the first settlement relating to the drug. In 2019, the drugmaker and a group of direct purchasers reached a separate $750 million settlement over claims that Forest used a “hard switch” to avoid losing market share to generics.

Forest Laboratories became a part of Actavis through an M&A deal in 2014. Actavis later changed its name to Allergan, which sold itself to AbbVie in 2020.

AbbVie did not immediately respond to Fierce Pharma’s request for comment.