There have been two key recent developments in the U.S. relating to the legal dispute over patent settlements including so-called “reverse payments.” First, the U.S. Supreme Court has agreed to review an Eleventh Circuit decision dismissing a case brought by the Federal Trade Commission (FTC) challenging a patent settlement.  Second, a district court in New Jersey issued the first decision to consider the legal treatment of a commitment by a brand name manufacturer to a generic company not to license any other generic companies the right to sell an authorized generic.

The Supreme Court’s decision to weigh into the “reverse payment” dispute is a pivotal moment in the development of [...]

On 16 July 2012, a U.S. appeals court issued a decision holding that pharmaceutical patent settlements that restrict generic entry and contain a payment to the generic company are presumptively unlawful under the U.S. antitrust laws.  The decision is a major victory for the U.S. Federal Trade Commission’s view of pharmaceutical patent settlements with so-called “reverse payments,” and dramatically alters the U.S. legal landscape in the U.S. with respect to such settlements.  Additionally, by holding that a patent settlement can violate the antitrust laws without proof that it affected competition outside the scope of a valid patent, the decision creates a direct conflict with the holdings [...]

The U.S. Supreme Court recently issued a decision that provides generic pharmaceutical manufacturers with the ability to challenge the “use codes” listed by brand name manufacturers in filings made with the U.S. Food and Drug Administration (“FDA”). The decision in Caraco v. Novo Nordisk illustrates the impact that these “use codes” can have on the generic drug approval process, and will likely open up a new area of litigation between brand name and generic manufacturers in the U.S. Specifically, a dispute can arise where a brand name manufacturer has a “method of use” or similar patent protecting its drug, and a generic manufacturer – in an attempt to avoid those patents � [...]

The U.S. Department of Justice (“DOJ”) has blocked two mergers in the past several months, in each case after filing a lawsuit against the merging parties.  The first case involved a relatively small transaction in the digital tax business involving H&R Block and 2nd Story Software. The second case was the high-profile proposed acquisition by AT&T of rival wireless telephone carrier T-Mobile USA.  These cases illustrate an uptick in U.S. merger enforcement and an increased willingness on the part of the DOJ to challenge mergers in court.  They also illustrate a  resistance on the part of DOJ to accepting concessions proposed by parties seeking to obtain clearance of horizontal mergers.

T [...]

The U.S. Federal Trade Commission has recently released two reports relating to the pharmaceutical industry. A significant theme in both reports is a concern that brand name pharmaceutical companies are using the threat of launching an authorized generic to make deals that delay generic entry. These reports shine a spotlight on the interplay between authorized generics and pharmaceutical patent settlements, and indicate strong FTC opposition to a practice that has never been found unlawful.

Report on Authorized Generics

On August 31, the FTC issued its final report analyzing the competitive significance of authorized generics. In the U.S., generic pharmaceutical products are typically sold b [...]

The U.S. Federal Trade Commission (“FTC”) has issued a report analyzing the U.S. patent system from a competition policy perspective. The FTC recognizes that, like the competitive process fostered by competition law, the right to exclude provided by the intellectual property laws is intended to promote innovation and thereby benefit consumers. The FTC believes, however, that several aspects of the U.S. patent system could be improved to better achieve these goals. In particular, the FTC focuses on several situations where the patent system may provide certain patentees – especially what the FTC refers to as “patent assertion entities” (i.e., “patent trolls”) – legal remedies [...]