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posted by LaminatorX on Sunday December 14 2014, @08:19AM   Printer-friendly
from the good-drugs dept.

Andrew Pollack reports at the NYT that a federal judge has blocked an attempt by the drug company Actavis to halt sales of an older form of its Alzheimer’s disease drug Namenda in favor of a newer version with a longer patent life after New York’s attorney general filed an antitrust lawsuit accusing the drug company of forcing patients to switch to the newer version of the widely used medicine to hinder competition from generic manufacturers. “Today’s decision prevents Actavis from pursuing its scheme to block competition and maintain its high drug prices,” says Eric Schneiderman, the New York attorney general. “Our lawsuit against Actavis sends a clear message: Drug companies cannot illegally prioritize profits over patients.” The case involves a practice called product hopping where brand name manufacturers (“product hoppers”) make a slight alteration to their prescription drug (PDF) and engage in marketing efforts to shift consumers from the old version to the new to insulate the drug company from generic competition for several years. For its part Actavis argued that an injunction would be “unprecedented and extraordinary” and would cause the company “great financial harm, including unnecessary manufacturing and marketing costs.” Namenda has been a big seller. In the last fiscal year, the drug generated $1.5 billion in sales. The drug costs about $300 a month.

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  • (Score: 3, Insightful) by sjames on Sunday December 14 2014, @04:32PM

    by sjames (2882) on Sunday December 14 2014, @04:32PM (#125957) Journal

    Considering that they were already in production and enjoying the high margins afforded by a boon from the government, it's not as if they have some huge start-up cost. They also aren't required to give the drug away or sell at cost suddenly, they get to keep charging what they have been charging.

    So it's more akin to community service than slavery. Perhaps they'd prefer the corporate equivalent of jail. That is, no profitable activity of any kind for 6 months and if you lose the house, too bad.

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  • (Score: 2) by frojack on Sunday December 14 2014, @09:16PM

    by frojack (1554) Subscriber Badge on Sunday December 14 2014, @09:16PM (#125994) Journal

    We don't know anything about their current profit on this old drug, only that they expect to see considerable competition for it by july.
    (The story give sales figures, which do not equate to profit). Since they have no competition now, I expect they are making a hansom profit.)

    They could jack the price over the next 6 months.
    They could drop the price over the next six months and fill the supply chain to suppress orders for the competitors.
    They could simply match the price of the new drug and let the market sort it out.
    They could drop the price of the new drug and thereby kill any incentive for generics to get into business.
    They could manufacture just enough to keep it in the catalog.

    There are lots of ways to end-run the Judge. The proper way is to appeal his ruling on the basis that it is unconstitutional, and there was no crime committed.

    No, you are mistaken. I've always had this sig.
    • (Score: 2) by sjames on Monday December 15 2014, @01:29AM

      by sjames (2882) on Monday December 15 2014, @01:29AM (#126047) Journal

      We can be fairly certain they're making a profit. If it can't be made profitably, there wouldn't be any competition lining up.

      There are a lot of dick moves available to them in addition to the one the judge said no to, but there are also regulations that may cover some or all of them. They chose to enter a regulated industry (where availability is one of the regulations) and to benefit a great deal from special protections and status for several years. They don't get to abuse that special advantage.

      If they want to continue the abuses, perhaps we need a second source law for drugs to keep it in check.

  • (Score: 1) by schad on Monday December 15 2014, @04:17AM

    by schad (2398) on Monday December 15 2014, @04:17AM (#126078)

    So it's more akin to community service than slavery.

    I'm not a fan of community service, either. As an alternative to a fine or jail time or probation or any number of other possible punishments, sure. But there is a difference, to me, between the government (or anyone else) telling me I cannot do something, and being told that I must do something. I think the bar for justifying the latter is, or at least ought to be, quite a bit higher.

    One interesting thing the government could've done would be to grant the patent to somebody else. Just for the last six months, of course, but it might still screw up the launch of the new drug. I'm definitely a fan of the "use it or lose it" approach to patents: if you don't want to take advantage of your government-granted monopoly, then the government should feel free to revoke said monopoly early. Though we would need to be careful to ensure that small inventors don't get locked out of producing or selling their inventions specifically so that the patent will be revoked.

    • (Score: 2) by sjames on Monday December 15 2014, @05:08AM

      by sjames (2882) on Monday December 15 2014, @05:08AM (#126091) Journal

      Revoking the patent wouldn't help in this case though. It appears several companies already have a plan underweigh to start selling in June. They probably can't make it happen much sooner at this point, patent or no patent.

      I can understand discomfort with community service, but it is worth considering that in theory (practically never enforced), a corporate charter is supposed to be permitted only when it is in the public interest in the first place. On top of that boon, they also have made a bajillion bucks due to their patent (another boon). Surely it's not too much to ask that they at least pretend to compete fairly.