Massachusetts Attorney General Martha Coakley Reaches Settlement With Barr Pharmaceuticals

June 13, 2007 -- BOSTON– Today, Massachusetts Attorney General Martha Coakley, along with the attorneys general of 33 other states and the District of Columbia, entered into a $5.5 million settlement with Warner Chilcott, the manufacturer of the popular oral contraceptive product Ovcon. Massachusetts will receive over $132,000 from the settlement. The lawsuit, filed in 2005, charged both Warner Chilcott and Barr Pharmaceuticals with violating antitrust laws by entering into an agreement that prevented generic versions of Ovcon from reaching the marketplace. The lawsuit against Barr will continue moving forward in the U.S. District Court for the District of Columbia.

"Warner Chilcott and Barr Pharmaceuticals allegedly conspired to keep generic alternatives to Ovcon off the market, to keep the price of Ovcon as high as possible, and to share in the allegedly illegal profits," Attorney General Martha Coakley said. "This lawsuit and settlement holds Warner Chilcott accountable for its actions, and helps ensure more choice and lower drug prices for consumers."

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The relief obtained by the states through the settlement will help ensure that Warner Chilcott will not engage in similar conduct in the future. Specifically, for the ten year term of the settlement, Warner Chilcott is prohibited from entering into any agreement that would have the effect of limiting the research, development, manufacture, or sale of a generic alternative to one of its drugs. Furthermore, Warner Chilcott must provide the states notice of certain agreements it has entered into with generic manufacturers, and must continue to make its records available to the states for inspection to determine whether the company is complying with the terms of the agreement.

The civil complaint was filed in 2005 in the U.S. District Court for the District of Columbia. According to the lawsuit, Ovcon has been sold in the United States since 1976 and Warner Chilcott became the exclusive U.S. distributor of Ovcon in early 2000. During 2003, Barr Pharmaceuticals publicly announced that it planned to have a generic version of Ovcon on the market by the end of that year. The lawsuit alleges that Warner Chilcott paid Barr Pharmaceuticals $1 million in September 2003 for an agreement designed to prevent Barr’s generic product from coming to market.

Under the terms of the alleged agreement, once Barr received FDA approval to market generic Ovcon, Warner Chilcott had 90 days to pay Barr $19 million, after which Barr would refuse to bring the cheaper generic version to the market. The lawsuit alleged that as a result of the agreement, Warner Chilcott paid Barr a total of $20 million to keep it from marketing its generic version of Ovcon.

Joining Massachusetts in today's settlement are: Alaska, Arizona, Arkansas, California, Colorado, Delaware, District of Columbia, Florida, Idaho, Illinois, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Michigan, Minnesota, Mississippi, Missouri, Nevada, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Rhode Island, South Carolina, Tennessee, Texas, Utah, Vermont and Virginia.

This matter is being handled by Assistant Attorney General Mary Freeley of the Attorney General's Antitrust Division.

Source: Massachusetts Attorney General