Sale of TB Drug Rights May Be Required to Offset Anticompetitive Acquisition

Akorn, Inc., a Louisiana-based pharmaceutical company headquartered in Illinois, may have to sell the rights to develop, manufacture, and market rifampin, a generic injectable drug used to treat tuberculosis, according to a proposed settlement with the Federal Trade Commission (FTC). The agreement would settle charges by the FTC regarding an acquisition by Akorn of VersaPharm Inc. and its parent company VPI Holdings Corp., which the FTC alleged was likely to be anticompetitive.

Only two firms other than VersaPharm were approved by the FDA to sell generic injectable rifampin, and there are no substitutes for the drug for the treatment of tuberculosis. “Absent the acquisition,” according to a press release, “Akorn likely would have entered the market for generic injectable rifampin in the near future, resulting in a significant price reduction for the drug.” Entry into the market could be delayed, the complaint states, if Akorn were to acquire VersaPharm.

The proposed settlement provides that Akorn will divest its Abbreviated New Drug Application for generic injectable rifampin to Watson Laboratories, Inc. The application is currently pending before the FDA. Akorn is required to aid Watson in the approval process, providing it with information requested by the FDA and “[provide] transitional services so that Watson can develop the ability to manufacture generic injectable rifampin independently,” according to the press release.

The consent agreement package will be published in the Federal Register and will be subject to public comment through September 3, 2014. Following the comment deadline, the FTC will determine whether the consent order should be made final.