Pay-for-delay deals continue to fall following FTC court victory
- The number of pay-for-delay agreements between branded drug companies and generic producers fell by almost 50% since 2012, according to the Federal Trade Commission (FTC).
- Pay-for-delay deals involve a brand-name drug manufacturer offering either cash or other incentives to a generic-drug producer to delay the introduction of lower-cost generic medications.
- In June 2013, a landmark Supreme Court ruling determined the FTC could go after pay-for-delay deals as a violation of antitrust law. There were 21 such deals in 2014, down from 40 in 2012.
While the Supreme Court's verdict did allow the FTC to pursue pay-for-delay deals as potential violations of antitrust law, the high court declined to rule the deals automatically illegal.
However, this decision seems to have sparked a steady decline in these types of deals. After the ruling, the number of pay-for-delay deals dropped from 40 in 2012, to 29 in 2013, and 21 last year. In 2005, only three such deals were made, before increasing steadily until 2013.
All told, the pay-for-delay deals in 2014 involved 20 branded drugs.
It should be noted that while the number of pay-for-delay deals decreased, the absolute number of settlements between branded and generic companies increased to 160.