Teva, Barr in largest ever pay-for-delay settlement

Teva Pharmaceutical Industries ($TEVA) and Barr Pharmaceuticals agreed to pay the largest settlement ever for a pharmaceutical "pay-for-delay" deal, $512 million. Fellow defendants Ranbaxy Laboratories and Mylan ($MYL) did not agree to the settlement.

The settlement, yet to be approved by the U.S. District Court in Philadelphia, involves a 2006 arrangement by Teva's Cephalon subsidiary, which it acquired in 2011 for $6.8 billion. The deal with the three drugmakers called for them to delay bringing their generic versions of Provigil (modafinil) for treating sleeplessness to market in exchange for exclusive rights beginning in 2012.

Teva and Barr likely settled because they face an upcoming trial in a case brought by the Federal Trade Commission, which accused them of anticompetitive practices. The U.S. Supreme Court declared two years that pay-for-delay deals are illegal.

Mylan and Ranbaxy also are not parties in that case.

- here are stories from Reuters, the Wall Street Journal and Bloomberg