Pay-for-Delay Drugmakers are Denied Supreme Court Review

The Supreme Court has denied a petition for certiorari filed by GlaxoSmithKline (GSK), which makes the brand drug Lamictal, and by Teva, which now sells less-expensive generic Lamictal in competition with GSK’s brand Lamictal.

Lamictal is the brand name for lamotrigine, an FDA-approved anticonvulsant and mood stabilizer.  In a conspiracy challenged by purchasers of Lamictal, Teva delayed launch of its competing generic Lamictal in exchange for GSK’s promise not to market an authorized generic version of Lamictal in competition with Teva’s version.  This is often called a “pay for delay” agreement.

The case is pending in federal court in New Jersey.

GSK and Teva had filed the certiorari petition with the Supreme Court to try to reverse the decision of the Court of Appeals for the Third Circuit, allowing the lawsuit to go forward.  In 2014, a unanimous panel of that court ruled that such a “no authorized generic” promise — a promise where a brand drug maker agrees not to compete against a would-be generic drug maker — was a reverse payment, and remanded for discovery and trial in the district court.  Faruqi & Faruqi, representing a drug wholesaler, filed an amicus curiae brief to the Third Circuit.

The Supreme Court’s denial of certiorari, on November 7, 2016, came after the Supreme Court invited the Solicitor General, on June 6, 2016, to express the views of the United States on GSK and Teva’s petition.  The Solicitor General did so on October 3, 2016, in a brief that argued against certiorari, for all the reasons the Lamictal purchasers had argued in their own brief opposing certiorari.

Faruqi & Faruqi authored substantial portions of the Lamictal purchasers’ successful brief opposing certiorari.

Faruqi & Faruqi previously filed a case in the district court, on behalf of a drug wholesaler, seeking to represent all direct purchasers of Lamictal.  The Lamictal case alleges that in 2005 GSK paid Teva not to come to market with generic Lamictal until 2008.  But instead of paying Teva in cash, GSK’s reverse payments to Teva included the promise that GSK would not launch an authorized generic version of Lamictal for 6 months after Teva entered the market with generic Lamictal.

Posted by Peter Kohn

Partner at Faruqi & Faruqi, LLP
Pennsylvania Office
Tel: (215) 277-5770
Fax: (215) 277-5771

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