Home >

August 4, 2016
For More Information, contact:
Luther Strange
Mike Lewis (334) 353-2199
Alabama Attorney General
Joy Patterson (334) 242-7491
Page 1 of 1


Anticompetitive Conduct Delayed Generic Competition,
Causing States and Consumers to Pay More for Provigil
(MONTGOMERY)–Attorney General Luther Strange today announced a $125 million,
48-state settlement with Cephalon and affiliated companies (“Cephalon”). The settlement ends a
multistate investigation into anticompetitive conduct by Cephalon to protect the monopoly
profits it earned from its landmark wakefulness drug, Provigil. That conduct delayed generic
versions of Provigil from entering the market for several years.
As patent and regulatory barriers that prevented generic competition to Provigil neared
expiration, Cephalon intentionally defrauded the Patent and Trademark Office to secure an
additional patent, which a court subsequently deemed invalid and unenforceable. Before that
court finding, Cephalon was able to delay generic competition for more than a decade by filing
patent infringement lawsuits against all potential generic competitors. Cephalon settled those
lawsuits in 2005 and early 2006 by paying the generic competitors to delay sale of their generic
versions of Provigil until at least April 2012. Because of that delayed entry, consumers, states,
and others paid hundreds of millions more for Provigil than they would have done if generic
versions of the drug had launched by early 2006, as expected.
The settlement includes $35 million for distribution to consumers who bought Provigil.
Alabama’s total recovery will be more than $1 million including: (1) funds to compensate for
Provigil purchases by certain state entities or authorized purchases off state contracts; (2) funds
for distribution to Alabama consumers for payments for Provigil; and (3) Alabama’s share of
the company’s repayment of wrongful gains and the states’ costs of investigation and litigation.
This multistate settlement was facilitated by litigation brought against Cephalon by the
Federal Trade Commission. In May of 2015, the FTC settled its suit against Cephalon for
injunctive relief and $1.2 billion, which was paid into an escrow account. The FTC settlement
allowed for those escrow funds to be distributed for settlement of certain related cases and
government investigations, such as those of the 48 states.
The settlement is subject to court review, including providing consumers with notice
and an opportunity to participate in, object to, or opt out of settlement. The states expect court
review will be provided by Judge Mitchell Goldberg of the Eastern District of Pennsylvania,
who is currently overseeing other litigation concerning Provigil against Cephalon and others.
501 Washington Avenue * Montgomery, AL 36104 * (334) 242-7300