Ftc suit against endo pharma11/11/2023 ![]() ![]() “The government hasn’t brought a price discrimination case in over 20 years, and the FTC has specifically called out price discrimination of potential areas focus,” Adelstein said.įinally, the U.S. “This applies in the tech area where the government has a pretty good focus, but it also applies strongly in the pharma space,” Adelstein said.Īnother focus of the Biden administration is price discrimination, where companies discriminate against various purchasers on price at different times. One concern is that companies with an existing product could acquire a smaller firm with a potentially competitive product to squash potential future competition. While this is most common in the tech sector, it could also create problems in the pharma industry. In addition, SEC has signaled its intention to scrutinize companies that serially make small acquisitions that might fly under the radar. “But the government is concerned about entrenching a monopolist in a powerful position so that others can’t compete.” SEC scrutiny of serial acquisitions “You need to be careful about how you challenge a discounting program because, typically, they’re helpful programs,” Adelstein said. Loyalty discounts are common in the life sciences industry, but there has not historically been a lot of government enforcement in this area. “I know that it is an area of concern for any companies involved in the distribution of products and also an area that the pharma companies use quite a lot.” “This area has been an area that hasn’t had a lot of focus previously,” Adelstein said. ![]() Some of the areas the FTC decided to focus on are loyalty discounts as well as bunding and tying arrangements. “What the FTC said is that they are going to look at a whole bunch of different conduct that could give rise to a claim that might fall short of an antitrust claim,” Adelstein said. But on July 2021, FTC Commissioner Lina Kahn withdrew that statement, arguing that the 2015 statement hampered the agency’s ability to “identify and combat unfair methods of competition even if they do not violate a separate antitrust statute.” In 2015, FTC released the Statement of Enforcement Principles Regarding ‘Unfair Methods of Competition’ Under Section 5 of the FTC Act to clarify its thinking on what constituted unfair competition. The FTC is seeking a court judgment declaring that the defendants’ conduct violates the antitrust laws, ordering the companies to disgorge their ill-gotten gains, and permanently barring them from engaging in similar anticompetitive behavior in the future.Įndo agreed to settle the charges in a proposed stipulated order to be entered by the court.“For a long time, the FTC Act has been interpreted as being coextensive with the antitrust laws,” Adelstein said. ![]() According to the FTC, a no-AG commitment can be extremely valuable to the first-filer generic, because it ensures that this company will capture all generic sales and be able to charge higher prices during the exclusivity period. But a branded drug manufacturer is permitted to market an authorized generic version of its own brand product at any time, including during the 180 days after the first generic competitor enters the market. Under federal law, the first generic applicant to challenge a branded pharmaceutical’s patent, referred to as the first filer, may be entitled to 180 days of exclusivity as against any other generic applicant upon final FDA approval. Lidoderm is a topical patch used to relieve pain associated with post-herpetic neuralgia, a complication of shingles. – to eliminate the risk of competition for Lidoderm, in violation of the Federal Trade Commission Act. The FTC’s complaint alleges that Endo paid the first generic companies that filed for FDA approval – Watson Laboratories, Inc. The agreement not to market an authorized generic – often called a “no-AG commitment” – is the form of reverse payment. and several other drug companies violated antitrust laws by using pay-for-delay settlements to block consumers’ access to lower-cost generic versions of Lidoderm. The FTC's complaint alleges that Endo Pharmaceuticals Inc.
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