Drug Companies to Pay California $69M for Delaying Generics

(CN) – The state of California reached a nearly $70 million settlement with several pharmaceutical companies over anticompetitive practices that delayed the release of more affordable generic drug brands onto the market, including medication that treats narcolepsy.

A portion of the $69 million settlement announced on Monday will be paid to California residents who purchased the name brand drugs Provigil and Nuvigil or the generic versions of the medications which are used to treat daytime sleepiness as a result of sleep apnea.

Teva Pharmaceuticals, Endo Pharmaceuticals, and Teikoku Pharma were among the companies named in the multiple settlement announced on Monday.

According to California Attorney General Xavier Becerra, the companies colluded to delay the release of generic medications to sustain a monopoly on name-brand versions.

Becerra said one generic brand of the narcolepsy drug Provigil was delayed for six years.

“These dark, illegal, collusive agreements that drug companies devise not only choke off price competition but burden our families and patients – they force every Californian to shoulder higher prices for life-saving medication,” Becerra said at a Monday press conference. “It’s nothing less than playing with people’s lives.”

One of the four settlements announced by Becerra involves a pay-for-delay deal by Teva Pharmaceuticals, which agreed to the $69 million settlement. The company also agreed to a 10-year injunction on future delay agreements that would keep affordable medications from entering the market.

A separate settlement included Teva, Endo Pharmaceuticals, and Teikoku Pharma over a pay-for-delay scheme that blocked the entry of a medical patch that provides relief to patients with shingles.

A $25 million fund will be created to reimburse California residents who purchased any of the narcolepsy drugs from 2006 to 2012.

Currently, a bill is making its way through the California Legislature that would ensure access to affordable drugs.

“We need to stop these types of deals before we have to go and sue these companies in court,” said Becerra.

An email and phone call to Teva Pharmaceuticals for comment on the settlement were not immediately answered by press time.

In May, 43 states and Puerto Rico sued 20 generic drug makers, accusing them of a massive price-fixing conspiracy. Teva Pharmaceuticals was among the list of companies in the complaint. Led by Connecticut Attorney General William Tong, the suit accuses 20 pharmaceutical companies of a conspiracy to inflate and manipulate generic prices, reduce competition, and unreasonably restrain trade for more than 100 different generic drugs.

A federal judge ordered emails which the states say bolster their conspiracy claims unsealed last month.

Meanwhile, Johnson & Johnson, subsidiary Janssen Pharmaceuticals, Teva Pharmaceutical Industries and OxyContin maker Purdue Pharma were sued in 2017 by the state of Oklahoma for their role in the opioid epidemic, with lawmakers claiming that the companies allegedly pushed doctors to prescribe opioid painkillers while downplaying the addiction risks and overstating their benefits.

All but Johnson & Johnson settled the case and a bench trial wrapped July 15, though the judge has yet to issue his verdict.

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