Thirteen years after the fact, a copycat accord with Glenmark Pharmaceuticals has come back to haunt Merck & Co. And now, the alleged pay-for-delay collaborators must face a jury trial.
Late last week, a Virginia federal judge scrapped Merck and Glenmark’s bid for summary judgment in the five-year-old case, which claims the drugmakers leveraged a 2010 settlement to stifle generics of Merck’s former cholesterol blockbuster Zetia.
Drug purchasers, payers and retailers filed their original suit in 2018 and amended the case the following year. The plaintiffs allege Merck paid Glenmark around $800 million in an “unlawful reverse-payment” to delay the launch of its Zetia copycat—which was the first generic to hit the market back in Dec. 2016—for nearly five years.
Merck and Glenmark attempted to escape the lawsuit by filing for a court judgment in August 2020.
The dismissal of Merck and Glenmark’s bid follows the advice of Magistrate Judge Douglas Miller. In September, Miller issued a report urging the federal the judge overseeing the case, Judge Rebecca Beach Smith, to put the case to a jury. He argued there were multiple issues at play surrounding the companies’ 2010 settlement, including the deal’s value and whether the pact included an anticompetitive angle.
In the latest order denying summary judgment, Judge Beach Smith largely agreed, pointing out multiple “disputes of fact regarding the nature of the value of the reverse payment in this case.”
According to the plaintiffs’ complaint, that payout was “unusual” and “large,” and it “far exceeded any estimate of the litigation expenses Merck saved by settling the patent case with Glenmark.”
The settlement between the companies spurred two distinct periods of “suppressed competition” for Zetia and its first copycat, the complaint continues. Purchasers were “overcharged during both periods,” the plaintiffs contend.
Merck and Glenmark, for their part, argue their 2010 agreement should be interpreted by “any reasonable juror” as constituting a “limited exclusive license provision under which Merck would not launch an unbranded [authorized generic] during a portion of Glenmark’s period of exclusivity.”
With Judge Beach Smith’s decision locked in, Merck and Glenmark will get a chance to plead their case before jurors at a trial set to begin April 17.