November 7, 2005
ATTORNEY GENERAL CURRAN SUES PHARMACEUTICAL COMPANIES
TO ENJOIN ANTICOMPETITIVE AGREEMENT
Twenty-two States File Lawsuit Alleging Defendants’ Agreement
Prevented Generic Competition for Oral Contraceptive
Maryland Attorney General J. Joseph Curran, Jr. today sued
Warner Chilcott Corporation and Barr Pharmaceuticals, Inc.
into an agreement which blocked generic competition for Warner
Chilcott’s oral contraceptive Ovcon®. The lawsuit, filed
with 20 other states plus DC, and in conjunction with the Federal
Trade Commission, alleges that Warner Chilcott paid Barr $20 million
to keep it from marketing a generic version of Ovcon®.
According to Attorney General Curran, "The agreement between
Warner Chilcott and Barr constitutes a blatant illegal restraint
of trade in the pharmaceutical industry. When competitors agree
not to compete with each other in exchange for monetary gain, consumers
and government purchasers are harmed."
Since 1976, Ovcon® has been sold in the United States as a
safe and effective oral contraceptive. Beginning in 2000, Warner
Chilcott became the exclusive U.S. distributor of Ovcon®. In
September 2001, Barr filed with the U.S. Food & Drug Administration
(FDA) an application to allow it to bring a generic version of
Ovcon® to market. In early 2003, Barr publicly announced that
it planned to have the generic on the market by the end of that
year. In response to this threat to its monopoly, in September
2003, Warner Chilcott paid Barr $1 million for an option agreement.
Under the terms of the agreement, once Barr received FDA approval
to market generic Ovcon®, Warner Chilcott had 90 days to pay
Barr $19 million. Once Warner Chilcott made this payment, Barr
would be prevented from coming to market with generic Ovcon®.
On April 23, 2004, the FDA gave Barr approval to market generic
Ovcon®. On May 6, 2004, Warner Chilcott exercised its option
by paying Barr $19 million. As a result of the option agreement,
as of today, Warner Chilcott remains the only company in the United
States which markets Ovcon® .
Attorney General Curran stated, "This investigation and litigation
is a good example of the cooperative antitrust enforcement efforts
between the State Attorneys General and the federal government,
and we plan to continue these efforts to benefit all purchasers
of prescription drugs."