Abbott Laboratories (NYSE:ABT) is currently fighting antitrust allegations relating to two of its best-selling drugs: Norvir, a protease inhibitor used in AIDS treatment, and Hytrin, a drug used to treat enlarged prostate and hypertension.
Last week, the Wall Street Journal ran a cover story on the Norvir case entitled "Inside Abbott's Tactics to Protect AIDS Drug." According to the article, in December 2003 Abbott quintupled the price of Norvir in order to protect sales of Kaletra, its more profitable AIDS medication. Other options that Abbott considered but ultimately rejected included withdrawing Norvir from the market entirely and selling Norvir only in a liquid formulation, about which one Abbott executive said that it tastes "like someone else's vomit."
The article is based on previously undisclosed Abbott documents (available at www.wsj.com with a subscription). Abbott's price hike has sparked an investigation by the Illinois Attorney General's office, as well as federal antitrust lawsuits.
At the same time, Abbott is fighting allegations of unlawful monopolization in connection with Hytrin. Kaiser Foundation Health Plan, a health care provider, is the plaintiff in the case. According to Kaiser's appeal brief, filed with the 9th Circuit last November, "Abbott extended its Hytrin monopoly by seeking objectively invalid new patents and gaming the regulatory system to delay generic competition for four additional years."
In addition, Kaiser alleged that Abbott paid Geneva Pharmaceuticals (now Sandoz) not to sell a generic version of Hytrin, "thereby violating Section 1 of the Sherman Act." Abbott successfully defended itself in the district court by invoking Noerr-Pennington immunity, which protects petitioning the government from antitrust liability.
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