July 19th, 2010

A federal judge recently ruled against the FTC in a case regarding generic medicine and anti-competitive conduct. The central issue in this specific case is whether the FTC attempted to coerce Watson Pharmaceuticals to produce a generic form of Provigil, an sleeping pill produced by Cephalon, with a Canadian company called Apotex. In the past, the FTC has vehemently opposed what it calls “pay-for-delay” deals in which brand drug companies make contracts with generic companies to temporarily suspend the  introduction of generic medicines to the market. Cephalon currently   has four agreements with five generic drug companies, including Watson. The contracts prohibit generic Provigil to be sold until 2012. Litigation between the FTC and Cephalon has been ongoing since 2008 regarding such contracts.

The Federal Judge, Alan Kay, explained in his opinion that the facts before the court “present a strong possibility that the FTC did share confidential information with Watson’s competitor, that it did attempt to broker a deal between Apotex and Watson.” Kay also said the FTC possibly pressured Watson to give up its exclusivity rights and harassed the company when it declined. He specifically ruled that Bisaro, CEO of Watson, can interview members of the FTC regarding their actions.

The FTC has a week to respond to the ruling that will possibly limit their authority in future matters.
To read more surronding this interesting case, click here.