Bystolic Drug Companies Noncompete Agreements Antitrust Class Action

When it’s time for a “blockbuster” drug’s patent to expire, makers of generics are normally in a hurry to create their own versions. However, the complaint for this antitrust class action alleges that those involved with the drug Bystolic entered into noncompete agreements with potential competitors, to delay the entry of generics into the market. The defendants include AbbVie, Inc., three companies under the Allergan name, and three under the Forest Laboratories name.

Bystolic is prescribed to treat hypertension.

The complaint says Abbreviated New Drug Applications (ANDAs) were filed with the Food and Drug Administration (FDA) for generic versions of Bystolic on December 17, 2011, “as soon as it was possible to do so. Despite these ANDAs filed nearly nine years ago, no generic competitor has or will enter the market until September 17, 2021.

Companies making $1 billion per year off a drug have an interest in delaying the entry of generics to the market. The complaint says, “Generic drugs typically cost 50% less than the branded product and capture 80% or more market share of the branded product within six to nine months of entering the market.”

According to the complaint, Forest entered into “unlawful reverse-payment agreements” with its generic competitors…”

The complaint alleges that these agreements included two provisions. First, the generic makers would not compete with Forest or enter the market before September 2017, unless another competitor did so first. Second, it suggests that Forest agreed to “provide consideration to the generics through ‘side-deals’ and cash payments.”

AbbVie and Allergan are successors-in-interest to other defendants, and the complaint says they “have perpetuated this illegal conduct.” The retention of market share for the defendant companies comes “at the expense of consumers and health insurers” who are deprived of the lower prices of the generics.

The complaint asserts that the generic competitors would have had products approved and ready to enter the market around June 2015, or at any rate, much sooner than September 2021. Instead, the complaint alleges, Forest shared its monopoly profits with them to induce them to stay out of the market until September 21, 2021.”

The agreements were uncovered, the complaint says, when as part of due diligence before a merger between Forest and Activis plc, outside lawyers reviewed documents at Forest and said the company should “review all of the Bystolic settlement and licensing agreements as well as the side agreements with those generic companies.”

Two classes have been defined for this action.

• The Injunctive Relief Class is all persons or entities in the US and its territories that bought, paid for, or provided reimbursement for some of all of the purchase price for Bystolic, other than for resale, at any time between June 2, 2015 and the time when the anticompetitive effects of the defendants stops.
• There is also a Damages Class, persons and entities who paid for Bystolic during the class period in certain states. See page 18 of the complaint linked below

Article Type: Lawsuit
Topic: Antitrust
Tags: Antitrust, Drugs and Generics, Keeping Generics Off the Market