Big Pharma payoffs to Generics companies - "somewhere between bribery and extortion"

From a great NJ Star-Ledger editorial:

The "pay to delay" deals are an anti-consumer twist on a law that was meant to help the public. The law was supposed to encourage generics to negotiate settlements that would bring them to market sooner, but the result has been a delayed market entry. Typically, the price of the first generic on the market is 20 percent lower than the brand-name price, and generic competition can reduce prices as much as 80 percent.

Increasingly, however, the industry's idea of a settlement is to pay off the generics to kill the challenges. The Federal Trade Commission says Schering-Plough of Kenilworth paid $90 million to two generic companies positioned to market a cheaper version of a Schering blood pressure drug. Bristol Myers Squibb agreed to pay $40 million to a Canadian generic to delay a knockoff of the blockbuster blood thinner Plavix, a deal that eventually fell through and led to regime change at Bristol Myers Squibb.

With many of the biggest-selling drugs scheduled to come off patent in the next four to five years, the FTC expects the payoffs to be bigger and more common.