It’s common to hear about tech giants like Apple or Google facing antitrust scrutiny. However, the pharmaceutical sector has also come under close examination for the same. Antitrust actions seek to assure fair competition. It restricts monopolistic behaviors that may affect end users.
In pharma, such actions often involve allegations of price-fixing, market allocation agreements, or abuse of patent rights. Mallinckrodt Pharmaceuticals, for example, faced accusations of exploitative conduct. The company acquired Synacthen Depot to defend its monopoly on Acthar Gel, which treats infantile spasms and other diseases.
Since 2001, the parent corporation has increased the price of each vial by 85000%, from $40 to approximately $34,000. The Federal Trade Commission penalized Mallinckrodt $100 million. The FTC also asked the corporation to license Synacthen Depot to a commission-approved licensee.
Such measures emphasize the critical role of regulatory supervision in maintaining equitable market practices. Fair competition encourages lower prices and broader access to medications. This benefits patients and healthcare systems alike. Let’s delve into a decade of such actions. We’ll analyze their profound implications for public health and the pharmaceutical industry.
Suboxone: Indivior, Reckitt Benckiser
In an antitrust case involving Suboxone, Reckitt Benckiser and its former subsidiary, Indivior, were accused of manipulating the drug’s formulation. Before generic tablets could enter the market, Indivior introduced a patented film version of Suboxone. They misleadingly suggested it was safer and less prone to accidental exposure by children.
Additionally, they filed a petition with the FDA, using unsupported safety claims to delay generic approvals. The FTC investigated the case and conducted a criminal probe. The investigation resulted in a $1.4 billion settlement with Reckitt and guilty pleas from Indivior executives. Reckitt agreed to a $50 million settlement and an injunction against similar misconduct. Indivior settled for $10 million under the same terms.
In addition to the $1.4 billion criminal settlement, another legal issue involving Suboxone is ongoing. According to TorHoerman Law, prolonged use of Suboxone has been linked to dental problems like tooth decay. The many affected individuals have pursued legal action to seek justice.
Victims can file a Suboxone lawsuit if they believe they’ve experienced dental problems due to the medication’s use. The lawsuit aims to provide compensation for medical expenses and other damages caused by using Suboxone. If you’ve suffered similar problems, consult with a lawyer experienced in pharmaceutical litigation. They’ll help you explore your legal options.
EpiPen: Mylan and Pfizer
In 2020, the FTC filed a complaint against Mylan Laboratories. Their involvement in anti-competitive behavior in the Lorazepam and Clorazepate trades was the subject of the complaint. Mylan is a major generic drug maker who allegedly used exclusive agreements. These agreements control the supply of raw materials needed for Lorazepam and Clorazepate. This strategy allowed Mylan to hike prices.
The lawsuit against Mylan lasted for many years. The court denied initial dismissal motions in 1999. Eventually, in 2001, Mylan agreed to pay $100 million to consumers and state agencies affected by the price increases. The settlement included an indefinite court order that forbade Mylan from being involved in such acts in the future.
Similarly, Pfizer faced scrutiny for acquiring Hospira in 2020. The FTC was worried that this merger would reduce market competition for generic medications. This includes acetylcysteine inhalation solution and clindamycin phosphate injection, which treat respiratory issues. To address these concerns, Pfizer was required to divest its rights to these medications to Alvogen for continued competition and affordability.
Shire ViroPharma
In the case of Shire ViroPharma, the company was accused of misusing government processes. The complaint alleged that between 2006 and 2012, ViroPharma made 43 filings with the FDA. Additionally, it filed three lawsuits against them. These actions were seen as repetitive. In addition, they lacked the necessary clinical data required for FDA clearance.
The Federal Trade Commission (FTC) claimed ViroPharma’s tactics were meant to block generic versions of Vancocin capsules from entering the market. The FTC sought a court order to stop ViroPharma from making baseless filings and to provide remedies like restitution.
However, on March 20, 2018, the district panel rejected the FTC’s case. The court stated that it didn’t adequately show that ViroPharma was currently violating the law. The FTC appealed this decision to the Third Circuit Court on June 19, 2018.
Forest Laboratories
Forest Laboratories, Inc. faced antitrust scrutiny when Actavis sought to acquire it. The complaint alleged that this merger could delay the availability of generic competition for Forest’s Lamictal ODT, a seizure medication.
There was no other company except Actavis with FDA approval for a generic equivalent of Lamictal ODT. The acquisition also threatened competition in other markets.
- Generic Diltiazem Hydrochloride capsules are for hypertension and angina.
- Generic Ursodiol tablets for liver disease.
- Generic Propranolol Hydrochloride capsules for hypertension.
The concern was that reduced competition could hike prices and hinder innovation. To address these issues, the companies were asked to make concessions. Actavis gave away its rights to market generic Diltiazem to Valeant Pharmaceuticals.
Also, generic Ursodiol and Lamictal ODT were sold to Impax Laboratories. Forest also sold its rights to generic Propranolol to Catalent Pharma Solutions. This action aimed to preserve competitive pricing and encourage ongoing competition in pharmaceutical markets.
Frequently Asked Questions
What is the difference between anti-competition and antitrust?
Anticompetition generally means practices that prevent competition in a market. It often happens through unfair or anti-competitive behavior. Antitrust refers to laws and regulations that promote and maintain fair competition. It prevents monopolies, price-fixing, and other practices that harm competition and consumers.
What are the anti-competitive practices of the pharmaceutical industry?
The pharmaceutical industry engages in anti-competitive practices such as patent evergreening and extending patents. Pay-for-delay agreements involve brand-name drug companies paying generics to delay market entry. Additionally, some companies abuse regulatory processes by repetitively filing and litigating to delay generic drug approvals. These practices stifle competition and can make the drugs expensive for end-users.
What are the competitive factors in the pharmaceutical industry?
Competitive factors include the threat of new entrants. High potential returns and venture capital funding drive this factor. Limited supplier power is another competitive force, as raw materials and equipment are commoditized. Additionally, the availability of substitutes impacts profitability post-patent expiry. Similarly, there are many factors at play influencing competition in the pharma sector.
In summary, antitrust actions in the pharmaceutical industry are crucial for maintaining fair competition and protecting consumers. Cases involving companies like Indivior, Mylan, and Forest Laboratories highlight the ongoing need for regulatory oversight to ensure affordable access to medications.
