ROWE SUES DRUG MAKER FOR BLOCKING ACCESS TO LOW COST DRUGS

December 12, 2001

DECEMBER 12, 2001

John Brautigam, Assistant Attorney General
207-626-8800

Maine Consumers, Agencies Were Forced to Pay Excessive Prices for Anti-Anxiety Medication BuSpar®

Maine Attorney General Steven Rowe today announced that he has filed a lawsuit against Bristol-Myers Squibb Co. ("Bristol-Myers") in the United States District Court for the Southern District of New York. Maine joins twenty-eight other states and Puerto Rico in filing suit against Bristol-Myers for blocking generic manufacturers from competing with the company's widely prescribed anti-anxiety medicine BuSpar®.

The lawsuit is the culmination of a multi-state investigation into statements made by Bristol-Myers to the federal Food & Drug Administration concerning Bristol-Myers' patent for BuSpar®. The suit alleges that Bristol-Myers misrepresented its patent rights, causing the FDA to extend its monopoly by blocking generic competitors.

"The high price of prescription drugs is a major problem for consumers in the State of Maine and the nation," said Attorney General Rowe. "Access to generic drugs helps contain the skyrocketing growth in prices, and we will vigorously oppose any scheme to illegally prevent consumers from enjoying the benefits of generic competition."

Under federal law, Bristol-Myers enjoyed a monopoly in the BuSpar® market for almost fifteen years - from the date of original FDA approval in 1986 until the BuSpar® patent expired on November 21, 2000. Ordinarily, on November 22, 2000 generic competitors would have been able to enter the market, providing consumers with a substantial price discount.

According to the complaint filed today, around the time the original patent expired Bristol-Myers applied for a new patent and then misrepresented its patent rights to the FDA in order to convince the agency not to approve generic competitors to BuSpar®. At the time of the alleged misrepresentations, generic competitors were poised to introduce their lower-priced versions of the drug into the market, even loading them onto trucks for shipment to consumers. Relying on Bristol-Myers' representations, the FDA blocked those shipments, and as a result consumers did not receive the benefit of the lower priced generic alternatives.

Federal and state antitrust laws prohibit any company from improperly monopolizing the market in consumer products such as prescription drugs.

Bristol-Myers' actions kept generic BuSpar® off of the market for nearly four months -until a federal court allowed generic competitors to sell their products, at least temporarily. During that time, thousands of consumers were denied the benefit of a low-cost generic equivalent toBuSpar®. Bristol-Myers also caused state agencies such as Medicaid to pay higher prices. Last year, total sales of BuSpar® exceeded $700 million.

Bristol-Myers and the generic manufactures are also tied up in litigation, and it is not yet clear whether the generic versions of BuSpar® will be able to remain on the market.

The suit filed by Maine and the other states seeks injunctive relief and monetary damages on behalf of consumers and state agencies. The Maine Medicaid program alone spent approximately $500,000 on BuSpar® during the four-month period at issue in the case.