Bristol-Myers Squibb Settles Lawsuits Over Allegedly Blocking Generic Versions of BuSpar, Taxol
Bristol-Myers Squibb yesterday announced that it has agreed to pay $670 million to settle lawsuits filed by state attorneys general, consumer groups and generic drug companies alleging that the company illegally delayed generic competition for anxiety drug BuSpar and cancer drug Taxol, the New York Times reports. Under the settlement, Bristol-Myers agreed to pay $535 million to resolve the BuSpar litigation and $135 million to settle the Taxol case. Company officials said that details of the agreement were still being negotiated with the state attorneys general and other parties involved in the suit. The terms of the settlement will need to be approved by the courts in which the lawsuits were filed (Petersen, New York Times, 1/8).
The BuSpar lawsuits were filed after Bristol-Myers won a patent for a process under which a molecule similar to BuSpar was given to patients to relieve anxiety. The company received the patent on the same day its original patent for BuSpar was set to expire. According to court records, after receiving the new patent, Bristol-Myers attorneys told FDA regulators that it protected a way to use BuSpar, although they had previously promised the patent office that the patent would not cover a new usage method. As a result of the move, drug companies developing generic versions of BuSpar had to go to court before being able to sell generic BuSpar. Lawsuits filed against Bristol-Myers alleged that because of the new patent, patients and government programs had paid millions of dollars too much for BuSpar because a lower-cost generic version was not available. In February, Federal District Judge John Koeltl ruled that the company had acted improperly when it filed for the additional patent (American Health Line, 1/7). Lawsuits against Bristol-Myers also alleged that the company illegally extended Taxol's five-year marketing rights period by fraudulently obtaining two patents to prevent generic companies from selling a lower-priced version of the drug. Further, the lawsuits allege that Bristol-Myers colluded with generics manufacturer American Bioscience to delay generic competition (California Healthline, 6/5/02).
The settlement "isn't the end" of Bristol-Myers' legal woes, as "not all plaintiffs are settling" and "not all of the issues have been resolved" for those who have agreed to settle, the Wall Street Journal reports. Connecticut Attorney General Richard Blumenthal (D) said, "This settlement won't happen unless there is absolutely full and fair injunctive relief to stop the illegal misconduct of inflating drug prices and blocking life-saving medicines from getting to people who need them." In addition, Ahaviah Glaser, director of the Prescription Access Litigation Project -- one of the groups that filed the suits -- said, "The numbers look like they could be inadequate" (Harris, Wall Street Journal, 1/8). According to New York Attorney General Eliot Spitzer (D), the high cost of the settlement should "send a message" to the pharmaceutical industry that actions to delay generic competition similar to those taken by Bristol-Myers would "not be tolerated." Bristol-Myers officials said that the company believed its actions were "entirely lawful" and that it agreed to the settlement to "put the uncertainty and risk of litigation" behind it, the Times reports. The settlement does not end an ongoing investigation by the Federal Trade Commission into Bristol-Myers' actions; the company is continuing discussions with the agency (New York Times, 1/8). NPR's "Morning Edition" today reported on the settlement announcement (Prakash, "Morning Edition," NPR, 1/8). The full segment will be available in RealPlayer online after noon ET.This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.