States Accuse Drug-Maker Bristol of Illegal Monopoly to Protect High Prices for Cancer-Fighting Drug Taxol

(SACRAMENTO) – Attorney General Bill Lockyer today joined in a multi-state antitrust complaint accusing pharmaceutical manufacturer Bristol-Myers Squibb, Inc. (Bristol) of illegally keeping cheaper, generic versions of its cancer-fighting drug Taxol off the market.

"We believe Bristol abused the patent process to stifle competition and create an illegal monopoly for its cancer-fighting drug Taxol," Lockyer said. "Bristol profited by artificially controlling the marketplace and should refund these ill-gotten gains and be prevented from repeating this kind of conduct. We know the State of California was forced to pay more for cancer treatment drugs than if a cheaper, generic version of Taxol had been available to choose from."

The complaint was filed jointly in the U.S. District Court in Washington, D.C., by Alabama, Alaska, Arizona, Arkansas, California, Connecticut, Delaware, Florida, Idaho, Illinois, Kansas, Kentucky, Louisiana, Maryland, Massachusetts, Michigan, New York, North Carolina, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, Texas, Utah, Vermont, Washington, Wisconsin, the District of Columbia, the U.S. Virgin Islands and Puerto Rico. Ohio, Maryland and Florida are leading the multi-state action.

In 1992, the U.S. Food and Drug Administration gave Bristol five years of exclusive marketing rights for Taxol. Paclitaxel, the actual pharmaceutical ingredient in Taxol, was discovered by the National Cancer Institute and developed and tested at taxpayer expense. Paclitaxel is used in treating ovarian, breast and a variety of other cancers. In 1993, the company told a congressional committee that a patent could not be created for paclitaxel and that "near-term generic competition for Taxol is a certainty".

The antitrust complaint alleges that Bristol delayed entry of a generic version of its drug until 2000 by fraudulently securing patents that had no legal validity. As a result, cancer patients and state governments were forced to pay nearly a third more for Taxol treatments. Bristol's sales of Taxol have totaled at least $5.4 billion since 1998. A standard course of treatment using the name brand drug can cost from $6,000 to $10,000 per patient. It is estimated that California spent more than $4 million at state medical facilities.

The action is the latest taken by Attorneys General against illegal marketplace manipulation, improper patent monopolization and wholesale price fixing, which result in higher drug prices for consumers.