Next spring, the U.S. Supreme Court will soon look at the very profitable policy called “pay for delay.”
Profitability in this case extends primarily to both the brand-name manufacturers and generic drug makers at the expense of the consumer. Estimates are “pay for delay,” costs consumers an extra $3.5 billion a year in the added cost of drugs.
“Pay for delay” involves the payments by the brand-name manufacturer to the generic drug company so it will delay in putting the generic on the market. The Federal Trade Commission (FTC) has challenged three such cases in lower courts but the Court will decide the contrary rulings.
While consumers end up paying more both the generic and brand-name manufacturer favor the policy. The generic maker is guaranteed a payment and the name-brand maker can extend profit on a drug that is about to fall outside of its patent.
The Court will review the delay deal over the testosterone drug AndroGel, now owned by Solvay Pharmaceuticals. A generic drug manufacturer won approval by the FDA to make a generic version in 2003 but AndroGel’s patent is not due to expire until 2020.
A patent infringement lawsuit ensued and the generic maker agreed not to make its drug until August 2015 in exchange for tens of millions of dollars it was paid annually.
The FTC says that is anti-competitive and has asked the Supreme Court to step in and issue a ruling. Oral arguments should begin in May or June, reports Politico.