Pfizer, Impax reach secret agreement on Detrol generic

Pfizer and Impax Laboratories have reached an undisclosed accommodation on if and when Impax will be able to launch a generic of Pfizer's bladder-control drug Detrol LA. Detrol and the extended-release version racked up more than $880 million last year. The settlement comes even as interest in an earlier Pfizer agreement over a generic attack attracted the involvement of the Federal Trade Commission (FTC).

While Pfizer ($PFE) confirmed to Bloomberg that the previous antagonists were not cooperating, it declined to give any specifics of the arrangement. Filings in the lawsuit in which Pfizer sued Impax ($IPXL) in 2008 over its plan to bring out a generic of Detrol LA prohibits Impax from selling a copycat of the drug during the life of two patents "except as permitted under the settlement and license agreement" between the companies.

Scrutiny of how patent holders and generics companies work out their differences, a long-simmering issue, heated up again two weeks ago when the FTC intervened in a lawsuit against Pfizer and Teva Pharmaceutical Industries ($TEVA) over their arrangement for handling the launch of a generic of Effexor XR, a blockbuster antidepressant. A group of drugstores sued the companies, alleging that they colluded to stop the launch.

In its filing, the FTC contends that cash does not have to grease a palm for a drugmaker to have "paid" to stop a generic. The FTC contends that forgoing an authorized generic is a "payment" of sorts and a "convenient method" of inducing generics makers to delay their launches.

Another case that gets at the issue is believed to be headed to the Supreme Court soon, which may sort out the whole question of whether any of these arrangements are permissible--a decision with potentially huge implications for both branded drug companies and their generic rivals.

- read the Bloomberg story

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