Sens. Herb Kohl (D-WI) and Chuck Grassley (R-IA) have introduced S. 369, the Preserve Access to Affordable Generics Act, to stop brand-name drug companies from paying generic companies to keep their product off the market.

The bill says it would be unlawful “for any person, in connection with the sale of a drug product, to directly or indirectly be a party to any agreement resolving or settling a patent infringement claim in which (1) an ANDA filer receives anything of value and (2) the ANDA filer agrees not to research, develop, manufacture, market, or sell the ANDA product for any period of time.

In a statement, the senators say that despite FTC opposition to such patent settlements, two 2005 appeals court decisions permitted them. In the two years since those decisions, they say, FTC has found that nearly half of all patent settlements involved payments from the brand name to the generic manufacturer in return for an agreement to keep the generic drug off the market. No such agreement was in patent settlements reported to FTC in the year before the court decisions.

“It’s time to stop these drug company pay-for-delay deals that only serve the profits of the companies involved and deny consumers access to affordable generic drugs,” Kohl said. “With this legislation we can end a practice seriously impeding generic drug competition that could save American families and taxpayers billions of dollars in healthcare costs.”

The statement refers to an FTC suit earlier this week charging that Solvay entered into an agreement with two generic drug companies to delay entry of their AndroGel products for nine years (see earlier story). “If these allegations are proven true, this case represents the exact type of agreement that would be rendered illegal by the Preserve Access to Affordable Generics Act,” it says.