California Attorney General Xavier Becerra today announced four settlement agreements against pharmaceutical companies for entering into collusive “pay-for-delay agreements” that illegally delay affordable prescription drugs from entering the market. Together, the settlements will result in these pharmaceutical companies making a nearly $70 million payment to the state. These settlements include the largest pay-for-delay settlement received by any state and are also the only ones to secure injunctive relief for a state against future pay-for-delay agreements. Pay-for-delay agreements allow a brand name drug company to continue its monopoly of a branded drug and to charge consumers higher prices.
The first settlement with Teva addresses anticompetitive pay-for-delay agreements that delayed a generic narcolepsy drug, Provigil, from entering the market for almost six years. The three other settlements with Teva, Endo Pharmaceuticals, and Teikoku address similar practices that prevented a generic version of the drug Lidoderm, a shingles medication, from entering the market for almost two years. Pay-for-delay agreements are costly to consumers and the healthcare market, causing consumers to pay as much as 90% more for drugs shielded from competition.
“These dark, illegal, collusive agreements that drug companies devise not only choke off-price competition but burden our families and patients—they force every Californian to shoulder higher prices for life-saving medication. It’s nothing less than playing with people’s lives,” said Attorney General Becerra. “Californians shouldn’t have to pay an arm and leg to afford their prescriptions."