Antitrust Has a Generic-Drug Problem

Antiretroviral drugs are one of the pharmaceutical industry’s great achievements. They have turned HIV/AIDS from a death sentence into a treatable condition. Still, even after being on the market for decades, effective antiretrovirals cost tens of thousands of dollars a year, making them unaffordable for many patients.

One reason for persistently high drug costs, according to many experts, is the exclusion of generic competition. Using a tactic known as “pay for delay,” brand-name drug companies who hold the patents to blockbuster medications pay other companies to put off introducing generic equivalents. This lets them keep charging high prices.

Pay for delay is maddening—the sort of thing that makes people say “There ought to be a law against this.” What’s truly maddening, however, is the fact that there a law against pay-for-delay deals: antitrust. The original federal antitrust law, the Sherman Act of 1890, outlaws “every contract, combination, or conspiracy … in 2019, accuses Gilead Sciences, the leading marketer of antiretrovirals, of striking deals with competitors to keep cheaper generic drugs out of the market. Gilead has denied the allegations, telling , “Any assertion that we worked to delay availability of lifesaving medication to patients is absolutely false.” The case went to trial last month.