Can Drug Companies Pay To Delay Release Of Generics?

WASHINGTON (March 24, 2013)—The U.S. Supreme Court will hear arguments Monday on whether drug companies should be allowed to pay generic drug makers to keep lower-priced versions off the market for a while.

Federal officials are trying to outlaw so-called "pay-for-delay" deals in which a brand-name drug maker pays a generic drug maker that’s challenging its drug patent to settle and launch a generic version on an agreed-upon date.

Federal officials, consumer and doctor groups say those deals cost American taxpayers $3.5 billion annually by delaying the launch of cheaper generics.

Drug makers and their supporters argue, however, that these deals save them litigation costs and often bring generics to market faster.

They say generic drugs saved American patients, taxpayers and the health care system an estimated $193 billion in 2011 alone.

The court will rule before summer.

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