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From Health Law Daily, March 13, 2013

FTC files amicus brief arguing that brand drug manufacturers’ blocking of generic access can violate antitrust laws

By Sheila Lynch-Afryl, JD, MA

The FTC has filed a brief as amicus curiae in the federal court for the District of New Jersey arguing that actions by brand name drug manufacturers to block generic access may violate the antitrust laws (Actelion Pharmaeuticals Ltd. v Apotex Inc., March 11, 2013). Generic drug companies sought to buy samples of the brand name manufacturer’s drug in an effort to create a generic competing version, but the brand manufacturer refused. The generic firms filed a complaint alleging violations of the Sherman Act, and the FTC filed a brief supporting their position. The FTC warned that adopting the brand manufacturer’s legal position would pose a significant threat to competition in the pharmaceutical industry and be costly for consumers of prescription drugs.

Allegations. Generic drug companies Actavis, Apotex, and Roxane sought to offer competing generic versions of Actelion’s brand-name drugs, Tracleer and Zavesca. To receive FDA approval under the process created by the Hatch-Waxman Act, companies must test their generic formulation against the reference brand drug, which requires access to a limited amount of the brand product. Actavis, Apotex, and Roxane alleged that Actelion implemented distribution restrictions that prohibited them from purchasing samples, which prevented them from meeting FDA requirements for developing generic versions of those drugs. They alleged that Actelion’s actions violated federal antitrust laws.

Actelion responded that antitrust laws place virtually no limit on its ability to block generic access to its product. It sought a declaration from the court that it is under no “duty or obligation” to sell its products to potential competitors.

Exclusionary conduct. In its amicus brief the FTC argued that a monopolist’s refusal to deal with its rivals may constitute exclusionary conduct supporting a violation of section 2 of the Sherman Act. Specifically, the generic firms’ allegations that they would be willing to compensate Actelion at full retail price supports an inference that the refused sales would have been profitable. In addition, Roxane alleged that Actelion provided non-competitor research organizations and brand drug companies with Tracleer and Zavesca to conduct clinical trials.

The FTC concluded that the Hatch-Waxman framework cannot function as Congress intended if generic firms are unable to access brand products.

The case number is 1:12-cv-05743-NLH-AMD.

MainStory: TopStory CaseDecisions AntitrustNews DrugBiologicalNews HatchWaxmanNews PrescriptionDrugNews NewJerseyNews

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