This article on Dr. Mercola’s blog is such important information that I wanted to waste no time in sharing it with you.
Following is the entire article from Mercola.com
A bill that would end an underhanded tactic that delays the introduction of generic drugs in the marketplace is pending in the Senate.
The tactic, known as “pay for delay,” occurs when a brand-name drug maker pays a significant sum of money to a generic drug maker in exchange for delaying the marketing of the new generic drug.
This allows brand-name drug makers to keep earning profits without competition, while the generic drug maker gets a large sum of “easy, risk-free money.”
As the New York Times reported:
“Both companies profit. The consumer, unfortunately, loses — by paying high, brand-name drug prices instead of lower prices for a generic. The Federal Trade Commission, which has been campaigning to end the practice, estimates that pay-for-delay agreements cost consumers at least $3.5 billion a year.”
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Dr. Mercola’s Comments:
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Many people still do not understand the enormous power wielded by the pharmaceutical industry. They, in a very real sense, have dictated the rules of the entire health care system through their massive lobbying, and their financial influence has shaped the health of the entire U.S. population, if not the world, for the worse.
At the heart of their financial success, of course, are the extremely profitable drugs that so many Americans use on a daily basis. The drug prices not only start out extraordinarily high to begin with, but the drug companies have underhanded tactics to ensure their profits keep rolling in, unchallenged, for as long as possible.
One of the most blatant of these is known as “pay for delay” — and there is legislation pending in the Senate that could stop it in its tracks.
“Pay for Delay” Schemes Should be Made Illegal
When a brand-name drug comes off patent, generic equivalents emerge that typically cost consumers far less than the brand-name version. Generic drugs are still overpriced in their own right, but less so than the brand-name drugs.
In the event that a generic drug manufacturer challenges a patent on a brand-name version, it can lead to a costly legal battle that may end up with a lost patent for the brand-name drug.
Knowing this, drug companies will offer to pay their generic rivals a significant sum of money in exchange for delaying the release of their lower priced, generic drug. Both companies profit from the scenario, but consumers lose out by having to continue to pay drug prices that are essentially fixed by the pharmaceutical companies themselves.
There is now a bill pending in the Senate that would essentially ban pay-for-delay schemes because they are both illegal and anticompetitive, but it remains uncertain whether the bill will actually pass — an atrocity considering how much money is being wasted by allowing pay-for-delay to continue.
According to the Federal Trade Commission, ending the practice would save consumers at least $3.5 billion a year, while the Congressional Budget Office stated banning pay-for-delay would reduce the federal deficit by $2.6 billion in the next 10 years.