Supreme Court Declines Chance To Stop Payoffs Delaying Generic Drugs

WASHINGTON - The Supreme Court refused Monday to hear an appeal of a patent case that antitrust officials had hoped would speed the public's access to cheaper generic versions of nearly a dozen popular medicines that now cost consumers more than $25 billion a year.

The Federal Trade Commissionmaintains that increasingly frequent court settlements allow brand-name pharmaceutical companies to pay off generic drug manufacturers in exchange for delays in the introduction of lower-priced but otherwise identical versions of medicines.

So the FTC asked the high court to review a March 2005 decision by the 11th U.S. Circuit Court of Appeals, which ruled there was no violation of antitrust law in settlements reached in lawsuits filed by the pharmaceutical company Schering-Plough Corp. against two companies challenging its patent on a drug.

The appeal pitted the FTC against the Justice Department, the other antitrust authority charged with reviewing the settlements.

The Solicitor General, representing the Bush administration, urged the Supreme Court not to take the FTC's case.

Schering sued two competitors that had challenged its patent for K-Dur 20, a potassium supplement given to patients on blood-pressure medications.

Schering paid the two companies $60 million and $15 million in settling the separate lawsuits. It also received pledges they would keep their generic versions of K-Dur off the market until 2001 and 2004, respectively. Schering's patent on K-Dur expires Sept. 1.

Since last year's appeals court ruling that the settlements were permissible, the number of similar settlements struck between brand-name and generic drug companies has increased, according to the FTC.

The Supreme Court decision not to hear the appeal could affect the outcome of litigation involving generic manufacturers seeking to introduce their own versions of the cholesterol-lowering drug Lipitor, blood-thinner Plavix, arthritis treatment Celebrex, heartburn medication Protonix and seven other of the 20 top-selling, brand-name drugs in the United States, according to the FTC.

A bipartisan group of four senators introduced legislation Monday that would ban settlements between brand-name and generic pharmaceutical companies that include both payments and delays.

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http://www.journalstar.com/articles/2006/06/26/business/doc44a05fa663fc1433461287.txt