Big Pharma and the "pay for delay" scam

The Federal Trade Commission says court-approved deals between drug manufacturers and companies that make cheaper generics are costing consumers billions of dollars.

A report by the agency coincides with congressional hearings and shows the settlements are becoming more common.

In a tactic upheld by appeals courts, brand-name drug companies pay off generic competitors, which then agree to delay introduction of less-costly non-brand-name versions.

Consumers Union says in a typical settlement, the generic drug company makes more money than it would from selling its cheaper version of the drug.

FTC Commissioner John Leibowitz decries what he calls "pernicious pay-for-delay settlements."

AP