Should “pay to delay” launch by branded pharma be considered illegal ?

An article in the International Herald Tribune (July 10,2014) titled “EU fines drug makers over generics”, describes the $450 million fine levied in Servier, a branded producer of the blood pressure drug perindopril. The company is accused of buying up rights to an alternate manufacturing process after its patent expired, and paying generic manufacturers to delay production, thus propping up drug prices. Once these tactics stopped, prices for the generic drug dropped 90%. Should such tactics by patent owners be banned to increase price competition? Will prices of drugs during the patent period increase if business tactics to reduce competition after patent expiry are banned ? Should such rules consider alternative treatments as competing options or should they apply to each individual drug ?

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About aviyer2010

Professor
This entry was posted in Global Contexts, Operations Management, Supply Chain Issues and tagged , , , , , , , , , . Bookmark the permalink.

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