A federal appeals court last month may have upheld the legality of pay-for-delay deals that thwart the introduction of generics, but the issue isn’t dead yet. A group of consumers, union health and welfare funds, which have been certified as a class, are asking a California appeals court to review the same set of circumstances involving Bayer, Barr Pharmaceuticals and the Cipro antibiotic.

At issue in both cases is a deal in which Bayer paid Barr, now owed by Teva Pharmaceuticals, to drop its 1991 patent challenge to Cipro. In 1997, Barr struck a deal with Bayer just two weeks before a lawsuit was set to go to trial, delaying the entrance of a generic version. The US Second Circuirt Court of Appeals ruled the deal was kosher (see here), although the Federal Trade Commission continues to argue - mostly in vain - that these so-called pay-to-delay deals are anti-competitive (see this).

Due to procedural matters, the California plaintiffs were waiting for the outcome of the Second Circuit ruling before filing their appeal (here it is). Whether they will win is unclear, but the case may be closely watched, especially since the FTC continues to suffer setbacks in pressing its argument. “If our appeal succeeds, we would still have to prevail at trial, but it could send an important signal,” says Dan Drachler, an attorney who represents the plaintiffs. “Courts often look to see what other courts are doing and California is, of course, a big state with a large population that spends large amounts of money on medications.”

Meanwhile, the plaintiffs who were rejected by the Second Circuit have filed a motion for a full court review, since the court last month acknowledged the issue needed further review. In fact, the court invited entities that purchase drugs and had challenged the Cipro settlement to ask that the case be reviewed by the full circuit, citing the “exceptional importance” of the antitrust implications. Here is their filing.

EDITOR’S NOTE: If you’re wondering why portions of both filings are redacted, this is because the original lawsuit was filed prior to the 2004 expiration of the Cipro patent and Bayer was able to win the argument that certain information is proprietary, a decision that continues to reverberate to this day in court filings.