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Refunds go out to cancer patients overcharged for drug, says AG Cooper

Release date: 6/1/2004

Raleigh: Attorney General Roy Cooper announced today that more than $200,000 in refunds are in the mail to North Carolina consumers who paid full price for a drug used to treat women’s cancer because the drug’s maker blocked access to generic versions.

“Patients suffering from cancer also suffered financially because a drug company kept a cheaper generic version of a life-saving drug off the market,” said Cooper. “That’s wrong and these consumers are now getting the refunds they deserve.”

In April of 2003, North Carolina joined 49 other states, 5 territories and the District of Columbia in an agreement to settle claims that Bristol-Myers Squibb, Inc. manipulated the patent process to maximize profits from the sale of its cancer drug Taxol. The settlement was approved by U.S. District Court for the District of Columbia in November 2003.

As a result of the settlement, consumers who paid all or part of the cost for treatments with Taxol or its generic paclitaxel during the period from January 1, 1999 through February 28, 2003 and who submitted valid claims by February 29, 2004 will receive reimbursement of at least $525. Consumers who paid the entire cost for two or more treatments will be paid $438 for each treatment.

Nationally, 12,723 consumers will recover a total of $7,242,114. In North Carolina, 508 people will receive a total of $280,458 from the settlement. A letter from Cooper explaining the payments will accompany the checks sent out to North Carolinians starting today.

The settlement resolved charges by Cooper and the other attorneys general that pharmaceutical giant Bristol deliberately manipulated the U. S. Patent and Trademark Office process in order to secure patents that were illegal. This act kept hospitals, cancer patients, and states from gaining access to generic Taxol until 2000. Under the settlement, Bristol must pay $37 million to state and local agencies that overpaid for brand name Taxol and is required to compete fairly in the future.

Paclitaxel, the active ingredient in Taxol, is effective in treating ovarian, breast, and other cancers. The drug was initially discovered by the National Cancer Institute and was developed and tested at taxpayer expense. In 1992, the Food and Drug Administration (FDA) gave Bristol exclusive marketing rights for Taxol for five years. Testifying before a congressional committee in 1993, Bristol said that paclitaxel could not be patented and that a generic version of Taxol would soon be on the market.

Bristol’s sales of Taxol totaled at least $5.4 billion since 1998. It is estimated that cancer patients paid 30 percent more for brand name Taxol because no generic alternative was available.