Cephalon got a one-two punch from the U.S. government yesterday. The FDA refused to approve its alertness drug Nuvigil to fight jet lag, a key element of the company's strategy for switching patients to the new med from its predecessor Provigil. Next, a federal judge refused to dismiss antitrust suits filed against Cephalon by the Federal Trade Commission and others.
Cephalon has a lot riding on Nuvigil; the top-selling Provigil goes off patent in 2012, so the company is depending on the newer med to take up the slack. And for that to happen, Cephalon has to persuade doctors and patients that Nuvigil is worth the switch. Every patient who moves to Nuvigil is one less likely to switch to generic versions of Provigil once they become available. An indication for jet lag would be one more marketing point in Nuvigil's favor.
The antitrust suits are related to the Provigil strategy. The FTC and other plaintiffs claim that Cephalon paid generics makers a total of $200 million to delay copycat versions of the drug until 2012 in one of the so-called "pay-for-delay" arrangements the FTC despises so much. Cephalon had asked U.S. District Judge Mitchell Goldberg in Philadelphia to toss out those claims, saying that the patent settlements were perfectly legal. However, he denied this request, earning the praise of FTC Chairman Jon Leibowitz. "Today's decision seems to reflect a growing understanding--first in Congress now in the courts--that brand name drug companies must not be allowed to make pay-offs to their generic competitors to keep low-cost generic drugs off the market," Leibowitz says in a statement.