Supreme Court says government can sue drug companies for pay-to-delay deals

On Monday the Supreme Court ruled that the United States government can sue pharmaceutical companies for delaying generic versions of drugs under so-called “pay-to-delay” deals. Big pharmaceutical companies often pay millions of dollars to generic drug manufacturers so they won’t produce cheaper, generic versions of brand-name drugs. This in turn keeps the price of medicines high by removing generic competition, forcing people and health insurers to pay more money for medications.

FTC Chairwoman Edith Ramirez claims that these pay-to-delay deals cost Americans $3.5 billion a year in higher drug prices. She praised the Court’s decision as a victory for consumers.

The Federal Trade Commission has been trying to stop big pharmaceutical companies from this practice. The Supreme Court’s decision opens the door to the government’s ability to sue pharmaceutical companies under anti-trust laws. 

The Supreme Court’s opinion in FTC v. Actavis, Inc. was delivered by Justice Breyer and may be found here.

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