U.S. Trade Commission to probe generic, branded drug agreements

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WASHINGTON (Reuters) -- U.S. regulators said Wednesday they will investigate whether agreements between brand-name and generic drug manufacturers have been keeping lower-cost medicines from consumers.

The Federal Trade Commission said it would probe whether companies made deals or used other strategies that delayed generic drugs from hitting the market after a patent expired. Generic drugs typically cost significantly less than their brand-name counterparts.

The FTC already has charged four companies with making arrangements that delayed the debuts of generic forms of two hypertension drugs, Aventis SA's Cardizem CD and Abbott Laboratories' Hytrin.

The commission has charged that in some cases brand-name firms have illegally paid generic companies to keep their products off the market.

The goal of the new study would be to "ensure that the process of bringing new, low-cost generic alternatives to the marketplace, and into the hands of consumers, is not impeded in ways that are anti-competitive," FTC chairman Robert Pitofsky said in a statement.

The agency said it would request information from about 30 brand-name drug makers and 60 generic firms.

The FTC said it was seeking public comments on its proposed questions, a requirement before the agency can receive final approval to go forward. Such FTC studies in the past have landed in the hands of Congress as recommendations for law.

The probe would examine whether companies have manipulated provisions of the Hatch-Waxman Act, a federal law that allows firms to file for Food and Drug Administration approval of a generic product before a patent has expired.

Under a 1997 agreement, Aventis paid Andrx Corp. to delay introduction of a competing version of Cardizem CD, said the FTC, which called the payment anti-competitive. The case is awaiting trial before an administrative law judge, and both companies have denied wrongdoing.

Last March the FTC announced it had settled similar charges that Abbott paid Geneva Pharmaceuticals Inc. to withhold a generic version of Hytrin from the market. Geneva is a unit of Swiss drug giant Novartis AG.

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