Cross-posted at Forbes.com’s “On the Docket” blog
Patent litigation has become a necessary, and expensive, precursor to the release of new generic drugs. Rather than incur millions in litigation costs, branded and generic companies often prefer to settle. Occasionally, the settlement terms include a payment from the generic to the branded company, along with an agreement that the generic drug won’t immediately enter the market.
The Federal Trade Commission (FTC) finds such agreements inherently anti-competitive, and has repeatedly, and so far unsuccessfully, filed court challenges to stop them. Courts have uniformly found that if the settlements do not extend the branded drug’s patent term, they are lawful. Finding no success in court, FTC has pressed Congress to impose a blanket ban, and bills to prohibit these settlements are pending in the House and Senate. Commissioners have testified in Congress promoting a ban, and have regularly written and spoken in public against patent settlements.
If an ongoing FTC investigation, and the troubling circumstances allegedly arising from it, is any indication, the Commission may be willing to go quite a bit further than filing suit or jaw-boning Congress to get its way on patent settlements. Continue reading “One Federal Agency’s Crusade Against Patent Litigation Settlements”