Earlier this year, when a U.S. appeals court officially thwarted Allergan's ($AGN) plan to force patients over to a new, patent-protected version of Namenda before generics hit, it looked like doom for the strategy. But now, Allergan is taking the matter to the Supreme Court.
The company has requested that SCOTUS rule on whether companies can take the "hard switch" tack--pulling an older med from the market before generics descend, to force patients over to a successor drug.
As an appeals court held in May, drugmakers have a federal antitrust duty to "facilitate the operation of state drug substitution laws" in order to maximize the future sales of their generic rivals. But one of Allergan's questions for SCOTUS is whether companies do actually have such a duty.
Allergan first ran into legal trouble over its Namenda-switching plot in September 2014, when New York attorney general Eric Schneiderman called the tactic illegal in a suit against the company. In December, a federal judge in New York ordered the Dublin drugmaker to continue making Namenda for the time being, and the May appeals court ruling put the nail in the coffin.
But while Namenda copies are already eating away at market share--Dr. Reddy's Laboratories ($RDY) and Mylan ($MYL) both rolled out knockoffs in mid-July--other pharma players could benefit from a decision in Allergan's favor.
"The questions presented are of critical and recurring importance to pharmaceutical manufacturers and patients," Allergan's request reads. If SCOTUS decides drugmakers do have an antitrust duty to uphold, it'll "profoundly affect the course of innovation" in the industry, it claims.
Meanwhile, Allergan is pinning its Alzheimer's sales hopes on new-and-improved Namenda XR, as well as fellow newcomer Namzaric—a med that combines Namenda's active ingredient with that in Eisai's Aricept. That product has been a bit slow out of the gate, though; on the company's Q3 conference call, CEO Brent Saunders assured investors that would change next year, with formulary coverage set to improve in January.
- read the request (PDF)
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