Teva agrees to $1.2B pay-for-delay settlement

Teva Pharmaceutical Industries Ltd. (NYSE:TEVA) will pay $1.2 billion to settle a Federal Trade Commission antitrust suit alleging that Cephalon Inc., which Teva later acquired, paid generic drug manufacturers more than $200 million to drop challenges against patents covering sleep disorder drug Provigil modafinil and delay the entry of generics into the market.

The FTC's suit, filed in 2008, alleged that Cephalon paid Ranbaxy Laboratories Ltd., Mylan N.V. (NASDAQ:MYL) and Barr Pharmaceuticals Inc., as well as Teva itself, to wait until 2012 to begin generic competition for Provigil, a film-coated modafinil that promotes alertness. Teva acquired Barr for about $7.5 billion in 2008 and paid $6.8 billion to acquire Cephalon in 2011 (see BioCentury, May 9, 2011). ...