Drug Manufacturing Companies Will Have to Pay $70 Million for Delaying Inexpensive Generics in California
On Monday, California’s the state attorney general Xavier Becerra has announced a fine of about 70 million dollars on pharma companies. Besides, the decision will affect the companies who have increased prices of generic medications by postponing the cheaper drugs. Becerra said Teva Pharmaceuticals Industries Ltd. kept generic drugs of Provigil. Experts use it to cure sleeping disorders and reduce extreme sleepiness. The pharmaceutical company had secured the medicine from counters for almost seven years. Teva Pharmaceutical Industries Ltd. is an Israel-headquartered company which will have to pay $69,000 million to California. According to Becerra, this settlement is one of the biggest pay-for-delay deal achieved by any government state across the globe.
Such contracts let the creator of brand tag drugs keep their controls over the medicines after their patents finish. Thereby it enables the manufacturer company to charge higher prices on the drug for customers. The drugmaker pays the generic developer to keep the inexpensive type of drug from entering the market for a decided period. Becerra said such contracts could force customers and the market to pay up to 90% more for a generic option. The executive noted the government would contribute more than 25 million dollars from the settlement amount. Further, the currency will go into a customer fund for California state citizens who purchased Modafinil, Provigil, or Nuvigil between 2005 and 2012.
Teva Pharmaceutical Industries Ltd., Teikoku Pharma, and Endo Pharmaceuticals are paying $760,000 to California. They had kept generic drug of Lidoderm from entering into the market for almost more than two years. Teva Pharmaceutical Industries Ltd. said it would offer US$ 200,000 to cover the California state’s legalized costs after settling same centralized claims earlier this year. Becerra notes everyone in America must get the medicines whenever they require.