The US Federal Trade Commission’s Bureau of Competition has issued a report for the year ending September 30 which notes that deals between generic and branded drugmakers to delay the introduction of copycat drugs is a practice that is alive and well.

The FTC report notes that there were 33 final settlements, nearly half of which (42%) included both compensation to the generic company and a restriction on the latter’s ability to market its product. Of those settlements, 79% involved agreements with first-filer generic companies but unlike the year before, most agreements involving restrictions on generic entry did not include a side deal “involving elements not directly related to the resolution of the patent dispute”. Instead, they involved compensation to the generic drugmaker “not to sponsor or compete with an authorised generic product for some period of time.”

FTC Chairman William Kovacic said that the report confirms that settlements with “potentially anti-competitive arrangements continue to be prevalent”. He added that the bureau is committed to ensuring that “brand and generic companies do not use such settlements as a way to deny consumers the benefits of competition”.

FTC Commissioner Jon Leibowitz noted that “as our report sadly demonstrates, pay-for-delay settlements continue to proliferate”. He added that this may be good news for the pharmaceutical industry, “which will make windfall profits on these deals...but it’s bad news for consumers, who will be left footing the bill”. Mr Leibowitz concluded by saying that “these agreements inflict special pain on the working poor and the elderly, who need effective drugs at affordable prices”.