SENATORS MOVE TO BLOCK GENERIC PAYOFFS

Sen Patrick Leahy (D, Vt) will introducea bill to outlaw payments that are madeby brand name pharmaceutical companiesto generics firms to prevent competition.Leahy said he would work withother senators, including CharlesGrassley (R, Iowa), Herbert Kohl (D, Wisc),and Charles Schumer (D, NY), to reintroducethe bill they sponsored in June2006.

Addressing a US Senate JudiciaryCommittee hearing on the issue, Leahysaid, "Congress never intended for brandname drug companies to be able to payoff generic companies not to producegeneric medicines—that would be ashame, harmful to consumers, and acrime." Support for the bill came fromFederal Trade Commissioner JonLeibowitz.

Leibowitz pointed out that, in 2005,only 3 of 11 US patent settlementsbetween brand name and generic companieshad included both an agreementto defer generic entry and some form ofpayment from the brand name firm tothe generic challenger; this number hadrisen to 14 of 28 final settlement agreementsin 2006.