Unlawful Conspiracy Restricted Production of Cipro, Consumers Charge in Suit Filed Today Against Bayer Corporation

Unlawful Conspiracy Restricted Production of Cipro, Consumers Charge in Suit Filed Today Against Bayer Corporation

Bayer Paid Competitors $200m to Keep Generic Cipro Off the Market; Suit Asks Court to Intercede, Nullify Agreement and Open the Way For Generics to Enter the Market

October 25, 2001
http://www.lieffcabraser.com/cipro_press.htm

WASHINGTON, D.C., October 25, 2001-- The Prescription Access Litigation (PAL) project announced today it has gone to court to dislodge an agreement between Bayer, Barr Laboratories, and two other generic drug companies that it says is blocking access to adequate supplies and cheaper, generic versions of Cipro, now the leading antibiotic used to treat Anthrax. Decrying the inadequacy of the arrangement that the federal government just negotiated with Bayer, consumer groups in eleven states -- representing over one million consumers -- have signed onto the litigation.
To learn more about the Cipro litigation, visit our companion website, Prescription Drugs Lawsuits.com.

The lawsuit asks the court to put aside the agreement, opening the way for generic forms of Cipro to enter the market. The plaintiffs charge that Bayer Corporation, a unit of Bayer AG, has unlawfully paid three of its competitors -- Barr Laboratories, Rugby, and Hoechst-Marion Roussel -- a total of $200 million to date to abandon efforts to bring cheaper generic versions of Cipro to the market, manipulating the price and supply of a drug that has suddenly become a crucial weapon in the fight against bio-terrorism. Because of these payments, the generic companies abandoned their argument that Bayer's patent was invalid and unenforceable.

"This is simply wrong on the face of it," said PAL spokesman Stephen Rosenfeld. "On the one hand you have people throughout the country worrying that public health officials may not have sufficient supplies of Cipro available. At the same time Bayer is paying Barr and two other companies millions of dollars to not produce the drug. We're calling on the court to set aside an agreement that has given Bayer an unlawful monopoly on a drug that's now critical to public health in this country. And we believe it is urgent that the court act expeditiously."

Cipro is the best selling antibiotic in the world and has been for eight consecutive years. In 1999 Cipro was the eleventh most prescribed drug in the United States based on new prescriptions and ranked twentieth in total US sales. Bayer's 1999 gross US sales of Cipro were approximately $1.04 billion.

Fourteen consumer and senior advocacy organizations are joining the suit, including Citizen Action of New York, Congress of California Seniors, Florida Alliance for Retired Americans, Health Care For All, New York Statewide Senior Action Council, New Jersey Citizen Action, Consumers for Affordable Health Care in Maine, among others (see full group listing on following page.) The effort is being led by PAL, a coalition of over 60 organizations in 29 states which is also the nation's largest consumer health advocacy organization seeking enforcement of laws to combat the high price of prescription drugs. PAL was formed earlier this year by Boston-based Community Catalyst, a national consumer health advocacy organization, and the National Health Law Program, which is based in Washington, D.C.

With today's filing, the consumer groups have joined an existing federal lawsuit filed last year in the Eastern District of New York to have Bayer's agreement with the three generic companies declared illegal. In that case, U.S. District Court Judge Trager has ruled that the plaintiffs' anti-trust claim is plausible and deserves to go to trial.

Bayer has marketed Cipro in the US since receiving approval from the FDA in October 1987. According to Judge Trager's ruling, Barr Laboratories applied in 1991 to the FDA to bring ciprofloxacin to market, asserting that Bayer's patent on Cipro was invalid and unenforceable. Bayer retaliated and sued Barr for patent infringement. In 1995 Barr received tentative FDA approval to manufacture and market generic Cipro, pending the resolution of the patent litigation. Beginning in 1997, however, Bayer paid Barr and the two other generic companies millions of dollars in exchange for their agreement to not manufacture the generic drug. To date, that agreement has resulted in payments totaling $200 million.

Concerned about the possibility of a wider-spread Anthrax attack, public health officials have announced plans to stockpile Cipro. Meanwhile, US pharmacies report their supplies are running low. Yesterday, following negotiations with Bayer, US Secretary of Health and Human Services (HHS) Tommy G. Thompson announced that the federal government will purchase 100 million tablets of Cipro from the brand-name manufacturer at a price of 95 cents apiece.

Commenting on that arrangement, PAL's Rosenfeld said "If Bayer had not entered into its collusive agreement with Barr and the two other generic companies, there would today be an ample supply of generic Cipro available at a fraction of the price that the federal government has now agreed to pay Bayer."

Participating Organizations

Fourteen consumer groups have signed onto PAL's Cipro litigation: Citizen Action of New York, Citizens for Consumer Justice, Colorado Progressive Coalition, Congress of California Seniors, Florida Alliance for Retired Americans, Health Care For All, Inc., Maine Consumers for Affordable Health Care, Massachusetts PIRG, Mississippi Human Services Coalition, New Jersey Citizen Action, New York StateWide Senior Action Council, Oregon Health Action Campaign, Pennsylvania Alliance for Retired Americans, UHCAN-OHIO.
Lieff Cabraser Heimann & Bernstein, LLP, serves as co-counsel for PAL, and specifically in the Cipro litigation.

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