Supreme Court to hear patent settlements case

GPhA files amicus brief

WASHINGTON — The Supreme Court will hear arguments later this month in a case that could determine the future of many patent settlements between brand and generic drug makers.

The high court will hear arguments in the case, Federal Trade Commission v. Actavis, on March 25. The case was originally titled FTC v. Watson, but has changed since Watson Pharmaceuticals changed its name following its acquisition of Swiss generic drug maker Actavis.

The FTC has long been an opponent of so-called "pay-for-delay" deals between brand and generic companies. When a generic company wishes to launch a generic version of a drug early, it will file a regulatory application with the Food and Drug Administration containing a Paragraph IV certification, an assertion that the branded drug's patent protection is invalid, unenforceable or won't be infringed. In virtually all cases, the branded drug's manufacturer will sue the generic drug maker for patent infringement, but usually, the generic drug maker agrees to hold off launch in exchange for the branded drug maker agreeing not to launch an "authorized generic" — essentially the branded drug marketed under its generic name at a reduced price, usually through a third-party company — or, less commonly, monetary payment.

At any rate, supporters of the deals say, they typically result in generic drugs becoming available months or even years before patent expiry, and holding off launch of the generic after patent expiry would be illegal.

The Generic Drug Association on Friday filed an amicus brief with the court, saying that the deals benefit consumers. "We believe the court will find that patent settlements are pro-consumer, pro-competition and transparent," GPhA president and CEO Ralph Neas said. "The proof is in the track record: When a patent settlement is reached, consumers gain access to the lower-cost generic medicines prior to patent expiration 100% of the time. These settlements have saved the healthcare system tens of billions of dollars over the past decade."

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