Gilead and Merck, along with some other renowned pharmaceutical companies, are involved in “pay-for-delay” deals to settle with the rising generic competitors to put off their market entry. The companies are alleged to have cost hundreds of millions to the drug buyers in lost savings consequently, following some recent high-profile lawsuits.
Federal regulators have tightly scrutinized the so-called “pay-for-delay” deals, which the pharma watchers are probably well aware of. The deals had been subjected to various court trials over the years.
Critics have already been claiming Gilead’s lucrative HIV business to have exploited the company’s monopoly in order to repress generics and to retain the elevated prices.
In another case filed in U.S. District Court in San Francisco, two renowned pharmacy chains, Ride Aid and CVS, are going head-to-head with Gilead, Teva and Bristol Myers Squibb (BMS), for being involved in “multifaceted scheme to suppress and delay” generic competitors of Gilead’s HIV medicines.
The band of drugmakers had been alleged by these pharmacies for engaging in illicit reverse-payment deals for various bellwether HIV therapeutics developed by Gilead. These therapeutics include Descovy, Atripla, Vemlidy, Truvada and Viread.
The litigation revolved around Gilead’s tenofovir alafenamide fumarate (TAF), tenofovir disoproxil fumarate (TDF) and emtricitabine (FTC)-based medicines. According to the suit, the company holds patents and exclusive licenses to the technologies used in medicines which annihilates the virus in HIV-positive patients. The drugs can also be used as a pre-exposure prophylaxis.
The litigants accused that the band of drugmakers joined hands to hold off small generic competitors, putting Teva on the front to launch copycats of HIV drugs. Meanwhile, Gilead earned a great deal of profits from generic delays.
However, the company said that the litigation “distorts and misstates Gilead’s history, its collaborations with its partners, and its settlement agreements,” claiming it to be “without merit”.
The New Jersey based pharma company, Merck, is facing similar court trials by two of the renowned insurance companies Centene and Humana, for adopting similar tactics as of Gilead’s, for its cholesterol drugs Zetia and Vytorin.
Generic makers Glenmark Pharmaceuticals and Merck’s Schering-Plough have also been accused in both of the aforementioned suits.
According to the litigation against Merck, the company had falsely listed its patents and was also involved in “pay-for-delay” deal with Glenmark in order to suppress its generic competitors. Consequently, both the insurers had to overpay “hundreds of million dollars” for the two drugs.
However, according to the lawsuits, Zetia “quickly became a steady source of enormous profits for Merck,” bringing in about $1 billion for the company from the blockbuster sales in 2010 and then growing up to $1.6 billion by the next 6 years.
Nevertheless, Merck’s representatives haven’t yet commented anything regarding the ongoing court trials.