Pharma Companies to Pay California Almost $70M to Settle ‘Pay-for-Delay’ Deals
California Attorney General Xavier Becerra on Monday announced that Teva Pharmaceuticals, Endo Pharmaceuticals and Teikoku will pay almost $70 million to settle four cases where generic versions of Provigil (modafinil) and Lidoderm (lidocaine) were delayed from entering the market.One of the settlements involves Teva accepting payments to prevent generic versions of Provigil from entering the market from June 2006 to December 2012. As part of this $69 million settlement, which includes a 10-year injunction prohibiting Teva from entering into pay-for-delay agreements, California will set up a more than $25 million consumer fund for California residents who purchased Provigil, Nuvigil (armodafinil) or modafinil.
Provigil generic delays also caused Teva subsidiary Cephalon in August 2016 to settle with every state and Washington, DC (but not California or Louisiana) for $125 million. That settlement followed a $1.2 billion settlement Cephalon made with the Federal Trade Commission (FTC) in May 2015.
The other California settlements announced Monday deal with all three companies’ use of payments to prevent generic versions of Lidoderm from entering the market for two years.
Becerra’s settlement with Endo secured an eight-year injunction against further pay-for delay agreements and payment of $760,000. Becerra also secured a 20-year injunction against Teikoku, a partner with Endo in the production of Lidoderm.
The announcement of the settlements follows an FTC report in May finding that FY 2016 had the lowest number of pay-for-delay agreements since 2004. Congress, meanwhile, has sought to halt the tide of pay-for-delay agreements, although legislation to crack down on such practices has passed the House of Representatives but stalled in the Senate.
California Settlements