Consumer groups' lawsuit alleges collusion in breast cancer drug pricing

NEW YORK (AP) -- A coalition of consumer groups sued three drug companies Wednesday, asserting a relationship among the firms artificially inflated the cost of a generic form of the breast cancer treatment drug tamoxifen.

The lawsuit filed in U.S. District Court against Zeneca Inc., AstraZeneca PLC and Barr Laboratories Inc. stems from Barr's successful patent challenge of Nolvadex, the brand name of tamoxifen now sold by a merged AstraZeneca.

A federal judge ruled in 1992 that Barr could sell tamoxifen under a generic label, but the ruling was appealed. In 1993, the two companies settled and Astra agreed to pay Barr $21 million and sell tamoxifen for resale as a generic drug.

Wednesday's lawsuit by five consumer groups, led by Boston-based Prescription Access Litigation Project, claims that settlement put into place an arrangement that ensured high prices for tamoxifen.

In a typical scenario a generic drug is anywhere from 35 percent to 80 percent cheaper than the branded version. Tamoxifen is about 5 percent cheaper than Nolvadex.

The Justice Department is investigating the arrangement.

"When commercial interests band together consumer interest gets lost," said attorney Stephan Rosenfeld, who is working on the Prescription Access Litigation Project. "The tamoxifen situation is an injustice for consumers."

AstraZeneca spokeswoman Mary Lynn Carter said the agreement didn't violate any antitrust laws.

Barr chairman and chief executive Bruce Downey said Barr buys the drug from AstraZeneca at a set price, so it can't sell tamoxifen cheaper.

"We brought a lower cost version of a drug on the market 10 years before patent expiration," Downey said.

Tamoxifen accounted for $297 million of sales at the Pomona, N.Y.-based company in fiscal 2000, making it Barr's biggest selling drug. Nolvadex is AstraZeneca's sixth biggest selling drug, bringing in $576 million in sales last year.