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Pay-for-delay agreements occur when a brand-name drugmaker pays a generic drugmaker to delay bringing a competing generic version of the brand-name drug to the market. These kinds of sweetheart deals have become increasingly common since 2005, when some U.S. Circuit Courts started to interpret anti-trust law as being of lesser weight than patent law. Since that time, dozens of generic drugs have been kept off the market, causing billions of dollars in unnecessary spending, and undermining consumer access to affordable generic drugs. The Federal Trade Commission has done a very good job highlighting the anti-competitive nature of these agreements, and challenging them in court. (More info on the FTC and these agreements here.)
There has also been consistent public opposition to these pay-for-delay agreements, both in the courts and in Congress.
Here are some of the sign-on letters that Community Catalyst has initiated or joined, showing the broad support for a ban on pay-for-delay settlements by consumer, labor, and senior organizations at the national, state and local level.
Letter by 20 organizations in April 2007 to Rep. Rush in support of his introduction of legislation to ban pay-for-delay agreements.
Letter by 25 organizations in October 2009 to the U.S. House leadership, supporting a ban in the national health reform bill.
Letter by 32 organizations in December 2009 to the U.S. Senate leadership, supporting inclusion of a ban in the Senate health reform bill.
Letter by seven national consumer organizations in January 2010 to the U.S. House and Senate leadership urging that a ban be included in national health reform.
Letter by 45 organizations in December 2010 to the U.S. Senate leadership, supporting the Senate's passage of the House's previously enacted legislative ban on pay-for-delay settlements.
On the legal front, PAL continues to support efforts to do away will these settlements.
- The class action lawsuit by PAL coalition member AFSCME District Council 37 challenging the pay-for-delay settlements concerning Provigil will suceed or not depending on the outcome of the Supreme Court's evaluation of these pay-for-delay agreements.