For Big Drug Companies, a Headache Looms

http://www.nytimes.com/2012/07/27/health/policy/drug-makers-deals-with-generic-rivals-may-face-justices-review.html

It would seem a business executive’s dream: legally pay a competitor to keep its product off the market for years.

Congress has failed to stop it, and for more than a decade generic drug makers and big-name pharmaceutical companies have been winning court rulings that allowed it.

Until this month. On July 16, a federal appeals court in Philadelphia issued a decision that the arrangement is anticompetitive on its face. It potentially sets up a confrontation before the United States Supreme Court. If it were to accept the case, the outcome could profoundly affect drug prices and health care costs.

The Philadelphia ruling by the Third Circuit Court of Appeals conflicted with decisions from at least three other federal circuit courts, giving the Supreme Court a strong reason to hear the case within the next few years.