Dive Brief:
- After a lengthy litigation process, Mylan has agreed to pay about $96.5 million to settle claims accusing Mylan of delaying introduction of a generic copy to Cephalon's narcolepsy drug Provigil (modafinil) in exchange for payment from Cephalon.
- In order to resolve the pay-for-delay class-action lawsuit, Mylan said it has reached a settlement in principle with the group of direct drug purchasers who initially brought the suit forward, paying up in exchange for dismissal of litigation.
- Terms of the settlement are subject to a Pennsylvania federal court’s approval, Mylan said. The settlement was first disclosed in a Feb. 3 filing by the drug purchasers, Reuters reported.
Dive Insight:
Nothing in the settlement agreement constitutes an admission of wrongdoing by Mylan or any of its affiliates, a spokesperson for Mylan emphasized in a statement to BioPharma Dive.
"After many years of litigation, Mylan has reached a settlement in principle with a proposed class of direct purchasers of the prescription pharmaceutical Provigil to resolve certain claims brought against Mylan and pending in the U.S. District Court for the Eastern District of Pennsylvania," Mylan said in its statement.
"As part of the settlement, Mylan will pay $96,525,000 in cash into an escrow fund for the benefit of members of the proposed class in exchange for dismissal of the litigation and certain releases."
In 2006, a group of direct purchasers sued Mylan, Cephalon, Teva Pharmaceutical Industries and Ranbaxy Laboratories, bringing their case on behalf of a nationwide class of direct purchasers, according to Reuters.
The purchasers alleged Cephalon reached settlements with Teva, Mylan and Ranbaxy, paying them to keep generic versions of Provigil off the shelves until 2012. The lawsuit alleged those settlements violated federal antitrust law.
Teva, which bought Cephalon in 2011, settled with the direct purchasers for $512 million in April 2015. A month later, the generics company paid $1.2 billion to the Federal Trade Commission to resolve a separate suit the agency had brought against Cephalon over the Provigil settlements.
Mylan’s settlement money, once approved, would go to purchasers, such as wholesalers and distributors, who bought brand-name Provigil directly from Cephalon.
Ranbaxy is not a party to the settlement disclosed last week.
The FTC has been more aggressive in litigating pay-for-delay deals between branded drugmakers and generic competitors since winning a Supreme Court case allowing the agency to prosecute under antitrust laws.
Just last month, Endo Pharmaceuticals agreed to a settlement with the FTC over similar charges to those against Mylan.