NEW YORK (AP) — A federal judge has recommended Watson Pharmaceuticals CEO Paul Bisaro testify in a federal investigation into the generic drug developer’s patent settlement with biotechnology company Cephalon.
In a decision on Tuesday, Magistrate Alan Kay of U.S. District Court in Washington made the recommendation in the ongoing case. The Federal Trade commission has accused Watson of delaying an investigation into a potential “pay-for-delay” deal on a generic sleep disorder drug. It has subpoenaed Bisaro as part of the investigation into whether Cephalon paid off potential competitors to keep cheaper versions of its sleep disorder drug Provigil off the market.
The FTC is investigating whether Watson is purposely keeping a generic version of Provigil off the market as part of a deal with Cephalon. “Pay-for-delay” deals involve generic drug makers being offered patent dispute settlements in return for delaying launch of a generic version of a drug.
As part of the ongoing dispute, Watson has alleged that the FTC disclosed privileged information and urged the company to give up its exclusivity rights to a generic version of Provigil. The FTC has denied the allegations.
Watson has said it doesn’t comment on ongoing litigation.
“The facts before this court now do not establish a direct attempt by the FTC to misuse the court’s process, for it has not been show that the subpoena itself was issued to harass Mr. Bisaro or that the investigation has been conducted for an improper purpose,” Kay wrote in his decision.
Still, he disagreed with how the FTC conducted certain aspects of its investigation, particularly using its position to pressure the company into waiving statutory rights. Although the FTC’s approach was “questionable,” he said, it is not the court’s job to turn subpoena enforcement proceedings into “exhaustive inquisitions” of the FTC’s practices.
Watson and the FTC have 14 days to respond.
