Apparently, Merck (NYSE:MRK) has had just about enough from companies that want to make generic versions of its branded drugs. In a move that has already shaken up some folks, Merck has aggressively targeted leading generic company TevaPharmaceuticals (NASDAQ:TEVA) by pricing its brand-name cholesterol drug, Zocor, below the generic price for some customers.

At stake: Teva's profits from its 180-day exclusivity period (gained by being the first to challenge the validity of Merck's patents), and perhaps industrywide profits in the future. Since generics are, well, generic, that 180-day window is often an important part of the overall profitability model for a generic company to not only develop a drug but also launch litigation to overturn the patent in question.

But Merck has negotiated separate deals with health insurance companies like UnitedHealth (NYSE:UNH) and WellPoint (NYSE:WLP), under which patients will be able to get Zocor at a lower cost than the generic version. Although the total number of people involved at present should be a fairly modest minority of the total population, the threat in such a move is pretty clear.

Of course, that's not the way you're going to hear it from Merck. From its point of view, this is just the competitive market working itself out -- and hey, isn't it great that consumers will benefit from lower-cost drugs?

It remains to be seen whether other large pharmaceutical companies like Pfizer (NYSE:PFE), GlaxoSmithKline (NYSE:GSK), and Novartis (NYSE:NVS) follow suit, and what the government decides to do about it. I don't pretend to be a lawyer or an antitrust regulator, but I know that words like "predatory pricing" are already being thrown around. Some folks were already mightily hacked off at the big pharma industry for its practice of so-called "authorized generics."

When all's said and done, I can't imagine that Congress will let the branded pharmaceutical industry choke off the generic industry through authorized deals and special pricing. That might mean a period of pronounced uncertainty and legal wrangling, as people debate and lobby for the best angle for their respective needs and interests. Given how much the markets hate uncertainty, though, that could also mean that big generic drug companies might go on sale for patient long-term investors.

For more pharm-fresh Foolishness:

Merck and GlaxoSmithKline are bothMotley Fool Income Investorrecommendations. To find other dividend-paying companies, take a free,30-day trialtoday.

Pfizer was recommended inInside Value, as was UnitedHealth. UnitedHealth has also been recommended inStock Advisor.

Fool contributorStephen Simpsonhas no financial interest in any stocks mentioned (that means he's neither long nor short the shares).