The Life Cycle of a Drug: Effexor XR

Pfizer's wholly-owned Wyeth subsidiary owned the original compound patent for venlafaxine hydrochloride (Effexor XR). This patent expired in 2008, but the company had filed a series of patents as explained in my post, Proprietary Drug Patents. with the aim of extending their patent monopoly to 2017. In 2002, Teva was the first generic manufacturer to file an abbreviated new drug application for the equivalence of their extended-release venlafaxine hydrochloride to the brand name product. In 2005, Wyeth entered into a pay-for-delay agreement with Teva to delay marketing of their generic until 2010. Among other things, Wyeth agreed to delay marketing an authorized generic until Teva's marketing exclusivity period for its generic ended. As is typical, this settled all the litigation between Wyeth and Teva. Wyeth also agreed to resolve any later litigation about the unenforceability or noninfringement of its follow-up series of drug development patents.

The above description is typical in the US. What is atypical is that a complaint in federal court alleging fraud by Wyeth and Teva has since been filed. Thanks to Don't trade out lives away for posting on this subject with links to the complaint and Reuters' announcement of the suit. The Incidental Economist's Kevin Outterson also has a post with links to the Federal Trade Commission's report on the consumer cost of pay-for-delay deals and an academic paper on the subject. Pfizer and Wyeth emphasize that they have engaged in a typical process that is lawful in the US. Perhaps the process is about to change?