Democrats call for end to generic drug settlements

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Sen. Charles Schumer (D-NY) and Rep. Henry Waxman (D-CA) have called on organizations representing innovator and generic drug companies to take a stance against the increase in settlements in which branded companies pay generics firms to keep generic drugs off the market.
The two said such settlements allow brand-name companies to pay generic firms to delay entry of their drugs into the market, decreasing competition and resulting in a drastic increase in the price of prescription drugs.

Schumer and Waxman said the settlements arise in the context of patent infringement lawsuits filed against generic firms.

“In many cases,” they said, “patent settlement agreements can provide great benefit, not only for the parties involved, by allowing them to avoid protracted litigation, but also for consumers, by speeding the entry of generic drugs that might otherwise have been deferred by the litigation.”
But they pointed out that since the late 1990s, settlements have often included agreements by generics firms to stay off the market in exchange for payments from brand-name firms.

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