FTC Sues Shire ViroPharma for Blocking Generic Versions of Vancocin

Company abused government processes to delay generic competition, agency contends

The Federal Trade Commission (FTC) has filed a complaint in federal district court charging Shire ViroPharma with violating antitrust laws by abusing government processes to delay generic competition to its branded prescription drug Vancocin (vancomycin) capsules. The complaint alleges that because of ViroPharma’s actions, consumers and other purchasers paid hundreds of millions of dollars more for their medication.

Vancocin capsules are used to treat Clostridium difficile-associated diarrhea (CDAD), a potentially life-threatening bacterial infection. According to the complaint, Vancocin capsules are not reasonably interchangeable with any other medications used to treat CDAD, and no other medication constrained ViroPharma’s pricing of the capsules. After ViroPharma acquired rights to the product in 2004, it raised the price significantly and continued to do so through 2011.

The FTC alleges that to maintain its monopoly, ViroPharma waged a campaign of serial, repetitive, and unsupported filings with the FDA and the courts to delay the FDA’s approval of generic vancomycin capsules and to exclude competition. According to the FTC, ViroPharma submitted 43 filings with the FDA and filed three lawsuits against the FDA between 2006 and 2012. The number and frequency of ViroPharma’s petitioning at the FDA were many multiples beyond that by any drug company related to any other drug, the agency contends. ViroPharma knew that it was the FDA’s practice to refrain from approving generic applications until it had resolved pending relevant citizen petition filings. Viropharma intended for its serial filings to delay the approval of generics, and thus competition and lower prices, according to the FTC.

The agency also alleges that ViroPharma started its petitioning campaign after a 2006 FDA recommendation that companies seeking approval for generic equivalents of Vancocin could establish bioequivalency through in vitro dissolution studies rather than by more time-consuming and costly studies involving sick patients, which generally are required only to support new drug applications.

According to the complaint, in filing after filing, ViroPharma failed to provide any clinical data to support its arguments. Even after a panel of 16 independent scientific and medical experts considered ViroPharma’s unsupported arguments and then voted unanimously in favor of the FDA’s guidance for generic vancomycin capsules, ViroPharma continued to repeat its rejected arguments, the complaint alleges.

According to the complaint, even though the FDA had completed its review of at least one application for generic vancomycin capsules by July 2010, it did not approve any application for the generic capsules until April 2012, the same day that it disposed of all of ViroPharma’s citizen-petition filings, labeling ViroPharma’s positions as “unsupported” and “without merit.” The FTC alleges that, without ViroPharma’s abuse of serial petitioning to exclude competitors, generic entry likely would have occurred by July 2010, or even earlier.

The FTC is seeking a court order permanently prohibiting ViroPharma from submitting repetitive and baseless filings with the FDA and the courts.

Source: FTC; February 7, 2017.