Barr Pharmaceuticals Settles With States
February 28, 2008
The Associated Press is reporting that Barr Pharmaceuticals has reached a $6 million settlement with 34 states that sued the company for illegally blocking the sale of a lower-priced generic drug, officials said recently.
The lawsuit, filed in November 2005 in Washington, D.C., accused Warner Chilcott Corp. of giving Barr $20 million to not produce the generic contraceptive Ovcon.
Barr, based in Montvale, N.J., received federal approval in 2004 to market generic Ovcon and was planning to sell it for about 30 percent less than Warner Chilcott''s price, the lawsuit alleges. But Barr opted to accept Warner Chilcott''s offer and not produce the drug.
Warner Chilcott, which has exclusive rights to produce Ovcon, feared competition would shrink profits, said Iowa Attorney General Tom Miller, who announced the settlement.
In the settlement filed this week in U.S. District Court, Barr did not admit any wrongdoing but agreed to pay $5.9 million to the states. Barr is prohibited from entering into certain agreements with other companies and is required to give notice to the states of certain agreements, Miller said.
According to the lawsuit, Ovcon has been sold in the United States since 1976, with Warner Chilcott holding exclusive rights to distribute the product since 2000.
Barr filed an application with the Federal Drug Administration in 2001 to market a generic form of Ovcon. Two years later, the lawsuit alleges, Warner Chilcott paid Barr $1 million, with the promise to pay $19 million once Barr received FDA approval to make the generic drug.