Monday, March 25, 2013

High Court To Consider Settlements That Slow Entry Into Generic Drug Market.

USA Today (3/25, Wolf) reports, "Consumers will have billions of dollars on the line today when the Supreme Court hears the government's case charging antitrust collusion between brand-name and generic drugmakers. What's in dispute, though, is whether the questionable deals cheat consumers - or whether they come out ahead." The Federal Trade Commission "has been on a decade-long crusade to stop settlements in which brand-name drugmakers pay generics to stay out of the $250 billion U.S. drug market for a specified number of years," but drug manufacturers "say that without such settlements, millions of dollars would be wasted in litigation, and when generics lose patent challenges, the lower-cost drugs would remain off the market even longer, until the patent expires."

        The New York Times (3/25, Wyatt, Subscription Publication) reports, "The case, Federal Trade Commission v. Actavis, No. 12-416, centers on whether the maker of a brand-name drug can pay a generic-drug company to keep the generic version off the market. Based on antitrust law, the obvious answer would seem to be no, the view voiced by the government and most recently upheld by a federal appeals court. At least three other federal appeals courts have previously said those payments are legal, however, when made under the settlement of a patent infringement lawsuit. Those courts sided with drug company arguments that the payments are what Congress intended in setting up guidelines to encourage the production of generic drugs. The question before the justices pits a company's constitutional right to protect its intellectual property - through reliance on a patent that excludes competitors - against antitrust law, which holds that a company cannot unfairly exclude others from legitimately entering a business with a rival product."
        The AP (3/25, Holland, Johnson) reports, "The Obama administration, backed by consumer groups and the American Medical Association, says these so-called 'pay for delay' deals profit the drug companies but harm consumers by adding 3.5 billion annually to their drug bills. But the pharmaceutical companies counter that they need to preserve longer the billions of dollars in revenue from their patented products in order to recover the billions they spend developing new drugs. And both the large companies and the generic makers say the marketing of generics often is hastened by these deals."

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