Novartis has made the decision to resolve all legal pay-for-delay disputes by making final settlements. Novartis will pay a total of $245 million in the form of a final settlement to all retailers, and direct and indirect buyers.
Novartis along with Endo’s Par Pharmaceutical delayed the development of Exforge, a medication for high blood pressure patients which led to this stage. The settlement news was confirmed by a Novartis representative.
Novartis claims that the idea of settlements, which was approved by a federal judge in New York, will resolve all past dues which were outstanding. The company official said that of the settlements reached with the three plaintiff groups, the one reached with the retailer class—which includes pharmacies like CVS and Walgreens—does not need court approval and would stay private.
The 2011 contract between Novartis and Par served as the basis of the 2018 lawsuit. According to a lawsuit, and as per the agreement Par agreed to delay the release of the version of Exforge until September 2014, more than two years after a patent expired.
In return, Novartis promised to refrain from releasing an approved version of Exforge for the 180 days that the FDA gave the Par version as the first imitator of the Novartis medication. Without that agreement, the plaintiffs claimed that Par would have begun selling its medicine in September 2012, when the patent expired, or at the latest March 2013, when it received final approval from the FDA.
According to the lawsuit, the plaintiffs overpaid for both brand-name and Exforge as a result of the Novartis and Par arrangement. The plaintiffs claimed that the alleged pay-for-delay deal violated federal antitrust laws. In a public settlement deal with the direct purchasers, Novartis did not take any responsibility and refused to acknowledge any wrongdoing.
In the biopharmaceutical sector, lawsuits regarding the legality of pay-for-delay agreements are frequent. Such agreements often entail a branded pharmaceutical company paying a competitor to postpone the introduction of the medicine. AbbVie signed a $54 million agreement in 2022 to resolve pay-for-delay accusations involving Namenda, a medication for Alzheimer’s disease. Similar allegations against AstraZeneca’s antipsychotic Seroquel XR are also being contested. In a different reverse payment litigation involving the constipation medication Amitiza from Takeda, Par was one of the defendants.
Another step has been taken by Novartis to put some of its past issues behind it with the resolution of the Exforge civil lawsuit. According to a statement from the firm, the settlements enable Novartis to concentrate on its ongoing operations.
A similar set of events took place in 2020 when Novartis Back agreed to a $729 million deal to put a stop to legal claims that it had paid bribes to physicians to increase the prescription of its medications, including Exforge. Additionally, in 2020, Novartis paid up $347 million and acknowledged doctor bribery in various nations in violation of the U.S. Foreign Corrupt Practices Act. It also contributed $195 million to a programme to fix generic medicine prices that affected a number of businesses, including Teva, Mylan, and many Indian pharmaceutical companies.