(Philly.com) – The Federal Trade Commission said Thursday that Teva Pharmaceutical Industries Ltd., now the parent company of Cephalon, agreed to repay $1.2 billion in “ill-gotten gains” for pay-to-delay deals when the two companies were competitors.
The settlement came as a trial was set to begin Monday in U.S. District Court in Philadelphia.
In a 2008 lawsuit, the FTC alleged that Cephalon paid more than $300 million to four generic drugmakers, including Teva, to delay sales of their versions of Cephalon’s blockbuster sleep-disorder drug Provigil.
Such agreements are referred to as “reverse payments,” or “pay-to-delay” deals. They allow the brand-name company to keep profits from exclusivity in the market that are larger than the payoff to the generic firms. The U.S. Supreme Court ruled in 2013 that such deals can be scrutinized for antitrust violations.