USFTC challenge generic settlement of Modafinil

The U.S. Federal Trade Commission (USFTC) filed a lawsuit against Cephalon on Wednesday, challenging deals that the company struck with generic drug makers to keep a cheaper generic version of the sleep disorder drug Provigil (Modafinil ) off the market.
Modafinil is a eugeroic drug generally prescribed to treat narcolepsy. It is not a typical stimulant and is often described as a "wakefulness promoting agent". The drug is sometimes prescribed off-label for Attention-Deficit Hyperactivity Disorder (ADHD). In mass-media advertisements and websites, Cephalon markets the drug for improving "alertness" and reducing excessive daytime sleepiness.
The FTC asked the U.S. District Court for the District of Columbia to void the agreements, essentially giving the generic drug makers the go-ahead to bring their versions to market.
The agreements, which the FTC said were worth $200 million, were designed to prevent Teva, Barr, Ranbaxy and Mylan all major generic manufacturers from selling a generic version of the sleep disorder drug Provigil until 2012, the agency said.
Provigil accounted for $800 million in the company's sales last year, or 46 percent, according to the FTC. Cephalon said in a statement it believed that the settlements were legal.
The agency said Cephalon made the $200 million in payments in "purportedly independent business transactions.""Cephalon prevented competition to Provigil by agreeing to share its future monopoly profits with generic drug makers poised to enter the market," FTC Bureau of Competition Director Jeffrey Schmidt said in statement. "Such conduct is at the core of what the antitrust laws proscribe."