|FTC Chairwoman Edith Ramirez|
Even as the FDA is questioning the widespread use of testosterone-boosting drugs for men, the Federal Trade Commission has sued AbbVie ($ABBV) and Teva Pharmaceutical Industries ($TEVA) for keeping a generic of one out of their reach for years. It is one of the first actions brought by the FTC since the Supreme Court last year said that so-called pay-for-delay deals are not inherently illegal.
A deal between Teva and Abbott Laboratories ($ABT) "forced consumers to overpay hundreds of millions for the drug AndroGel," FTC Chairwoman Edith Ramirez said in a statement today. AbbVie ended up with AndroGel, and thus this litigation, when it was spun off by Abbott last year.
While most of these pay-for-delay deals involve settlements for the specific drug targeted with a patent challenge, the AbbVie and Teva arrangement was a bit more sophisticated, the FTC says. The agency alleges that AbbVie and a partner, Besins Healthcare, "filed baseless patent infringement lawsuits against potential generic competitors to delay the introduction" of generic AndroGel. Then while the suits were pending it worked out a pay-for-delay settlement agreement with Teva, the FTC claims. Instead of agreeing to a cash payment in exchange for holding off its generic of AndroGel generic, however, AbbVie made a deal to allow Teva to release an authorized generic of the cholesterol blockbuster Tricor, the FTC alleges. As substantiation, it says that while this was a sweet deal for Teva, the arrangement "made no independent business sense for AbbVie."
In a 5-3 vote, last year, the Supreme Court ruled that the FTC has the right to challenge brand-name drugmakers' patent settlements with generics companies. While a slap in the face for the drug industry, it stopped short of adopting the FTC's position that these patent settlements should be assumed anticompetitive unless proven otherwise.
Earlier this year, Deborah Feinstein, director of the FTC's Bureau of Competition, said the agency would not be deterred in pursuing pay-for-delay actions. She said the agency is so tired of these measures, that it was hoping to get a $1 billion settlement in at least one these cases this year.
The FTC action comes only days ahead of an FDA advisory panel review of testosterone lowering, or so-called Low-T, drugs. A staff review last week said it doesn't have much evidence that the Low-T products taken by millions of American men are all that beneficial for most but also took issue with some recent research that suggested there were much higher cardiovascular risks from taking them.
- here's the FTC statement