This sounds almost too hard to believe. According to TPM, Drug-Makers Paying Off Competitors To Keep Cheap Generics Off Market.
Indeed:
Over the last few years, drug-makers have embraced a startlingly simple tactic for fending off competition from generic brands: paying them off. In a nutshell, the company that holds the patent on a profitable drug strikes a deal with the maker of the cheaper generic brand: you hold off on marketing your generic for several years, and in return, we’ll give you a share of our profits on the drug.
So common have these deals become lately that they’ve been given a name: pay-for-delay. The approach — a textbook anti-competitive tactic — is worth billions to drug-makers, because it essentially allows them to buy more protection than their patent confers.
That was made more or less explicit by Frank Balsino, the CEO of Cephalon, which makes the sleep-disorder drug Provigil. In a 2006 interview, Baldino trumpeted recent deals with four generic drug-makers that kept generic versions of Provigil off the market until 2012, declaring: “We were able to get six more years of patent protection. That’s $4 billion in sales that no one expected.”
Whatever the reason for this — good, bad, or indifferent — it adds up to greater costs to the consumer and the organizations that insure them. It also sounds like abuse of the patent process. To say the least.
Smart People I Know 