Skip to main content Accessibility help

We use cookies to distinguish you from other users and to provide you with a better experience on our websites. Close this message to accept cookies or find out how to manage your cookie settings.

Close cookie message
×
Hostname: page-component-cd9895bd7-hc48f Total loading time: 0 Render date: 2024-12-23T20:27:26.141Z Has data issue: false hasContentIssue false

8 - The Hatch-Waxman Act, Patent Infringement Suits, and Reverse Payments

from Part II - Seller Cartels

Published online by Cambridge University Press:  24 November 2022

Roger D. Blair ,
Christine Piette Durrance  and
Tirza J. Angerhofer
Roger D. Blair
Affiliation:
University of Florida
Christine Piette Durrance
Affiliation:
University of Wisconsin
Tirza J. Angerhofer
Affiliation:
Duke University, North Carolina
Get access

Summary

The Hatch-Waxman Act of 1984 extended the patent life of a pioneer drug to compensate for delays in the FDA approval process, which incentivized pioneer firms to invest in research and development and accelerated the entry of generic drugs, which would reduce pharmaceutical expenditures. Unfortunately, the Act has serious flaws that encourage both generic producers and pioneer firms to game the system. In the pursuit of economic profit, some producers of generic drugs use the Hatch-Waxman Act to challenge pioneer brands that were covered by valid patents. This conduct undermines the value of the patent awarded to the pioneer firm by the Patent and Trademark Office. At the same time, pioneer firms stall generic competition by filing perhaps baseless patent infringement suits. After 30 months, the pioneer firm and the would-be entrant often strike deals that result in reverse payments by the pioneer firm to the generic producer to delay its entry into the market. This conduct has aroused antitrust concerns that are the subject of this chapter.

Keywords

reverse paymentsHatch-Waxman Actpay-for-delayprescription drug pricing
Type
Chapter
Information
Antitrust Policy in Health Care Markets , pp. 168 - 203
Publisher: Cambridge University Press
Print publication year: 2022

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Areeda, Phillip, and Hovenkamp, Herbert. (2021). Antitrust Law, Vol. XII. 5th ed. New York: Wolters Kluwer.Google Scholar
Areeda, Phillip E., Hovenkamp, Herbert, Blair, Roger D., and Durrance, Christine Piette. (2021). Antitrust Law, Vol. IIA, 5th ed. New York: Wolters Kluwer.Google Scholar
Barker, Holly. (2020). Glumetza Class Certified in Lawsuit Alleging $2.3 Billion Injury. Bloomberg Law. https://news.bloomberglaw.com/mergers-and-antitrust/gulemtza-class-certified-in-lawsuit-alleging-2-3-billion-injury.Google Scholar
Bauman, Valerie. (2020). Pharma Pay-for-Delay Deals Called “Cost of Doing Business.” Bloomberg Law. https://news.bloomberglaw.com/pharma-and-life-sciences/pharma-pay-for-delay-settlements-cost-of-doing-business.Google Scholar
Blair, Roger D., and Cotter, Thomas F.. (2002). Are Settlements of Patent Disputes Illegal Per Se? Antitrust Bulletin 47: 491–539.CrossRefGoogle Scholar
Brittain, Blake. (2021). Lupin Agrees to Pay $150 Mln to settle Glumetza Antitrust Claims. Reuters. www.reuters.com/legal/litigation/lupin-agrees-pay-150-mln-settle-glumetza-antitrust-claims-2021-09-21/.Google Scholar
Carrier, Michael A. (2014). Payment After Actavis. Iowa Law Review 100: 7–49.Google Scholar
Federal Trade Commission. (2019). Last Remaining Defendant Settles FTC Suit That Led to Landmark Supreme Court Ruling on Drug Company “Reverse Payments.” www.ftc.gov/news-events/press-releases/2019/02/last-remaining-defendant-settles-ftc-suit-led-landmark-supreme.Google Scholar
Federal Trade Commission. (2020). Agreements Filed with the Federal Trade Commission under the Medicare Prescription Drug, Improvement, and Modernization Act of 2003: Overview of Agreements Filed in FY 2017. www.ftc.gov/system/files/documents/reports/agreements-filed-federal-trade-commission-under-medicare-prescription-drug-improvement-modernization/mma_report_fy2017.pdf.Google Scholar
Ford, Mark A., Spaeth, Peter A., and Luo, Christina. (2020). Unprecedented State Law on Pharmaceutical “Reverse Payments” Goes into Effect. www.wilmerhale.com/en/insights/client-alerts/20200108-unprecedented-state-law-on-pharmaceutical-reverse-payments-goes-into-effect.Google Scholar
Gallasch, Sven. (2016). Activating Actavis in Europe: The Proposal of a “Structure Effects-Based” Analysis for Pay-for-Delay Settlements. Legal Studies 36: 683–705.CrossRefGoogle Scholar
Grabowski, Henry, Kyle, Margaret, Mortimer, Richard, Long, Genia, and Kirson, Noam. (2011). Evolving Brand-Name and Generic Drug Competition May Warrant a Revision of the Hatch-Waxman Act. Health Affairs 30: 2157–2166.CrossRefGoogle ScholarPubMed
Grabowski, Henry, and Vernon, John. (1986). Longer Patents for Lower Imitation Barriers: The 1984 Drug Act. American Economic Review 76: 195–198.Google Scholar
Karas, Laura, Anderson, Gerard F., and Feldman, Robin. (2019 ). Pharmaceutical ‘Pay-for-Delay’ Reexamined: A Dwindling Practice or a Persistent Problem? Hastings Law Journal 71: 959–974.Google Scholar
Leonard, Mike. (2021). Jazz Pharma, Hikma, Others Ordered to Face Xyrem Antitrust Case. Bloomberg Law. https://news.bloomberglaw.com/us-law-week/jazz-pharma-hikma-others-ordered-to-face-xyrem-antitrust-case.Google Scholar
Lichtenberg, Nick. (2019). Celgene Settles Class Action Antitrust Case for $55M: Law Firm. Bloomberg Law. https://news.bloomberglaw.com/pharma-and-life-sciences/celgene-settles-class-action-antitrust-case-for-55m-law-firm.Google Scholar
Pierson, Brendan. (2021). Bausch to Pay $300 Mln in Antitrust Suit over Diabetes Drug. Reuters. www.reuters.com/business/healthcare-pharmaceuticals/bausch-pay-300-mln-antitrust-suit-over-diabetes-drug-2021-09-09/.Google Scholar
Sullivan, Thomas. (2019). Allergan Subsidiary Forest Settles for $750 Million in Namenda Class Action Pay for Delay Suit. Policymed. www.policymed.com/2019/11/allergan-subsidiary-forest-settles-for-750-million-in-namenda-class-action-pay-for-delay-suit.html.Google Scholar
Towey, Jamie, and Albert, Brad. (2019). Then, Now, and Down the Road: Trends in Pharmaceutical Patent Aettlements after FTC v. Actavis. www.ftc.gov/news-events/blogs/competition-matters/2019/05/then-now-down-road-trends-pharmaceutical-patent.Google Scholar
US Food and Drug Administration. (2021). Drug Approval Process. www.fda.gov/media/82381/download.Google Scholar
Yasiejko, Christopher. (2020). Pfizer Files More Patent-Infringement Suits on Ibrance Capsules. Bloomberg Law. https://news.bloomberglaw.com/ip-law/pfizer-files-more-patent-infringement-suits-on-ibrance-capsules.Google Scholar

Save book to Kindle

To save this book to your Kindle, first ensure [email protected] is added to your Approved Personal Document E-mail List under your Personal Document Settings on the Manage Your Content and Devices page of your Amazon account. Then enter the ‘name’ part of your Kindle email address below. Find out more about saving to your Kindle.

Note you can select to save to either the @free.kindle.com or @kindle.com variations. ‘@free.kindle.com’ emails are free but can only be saved to your device when it is connected to wi-fi. ‘@kindle.com’ emails can be delivered even when you are not connected to wi-fi, but note that service fees apply.

Find out more about the Kindle Personal Document Service.

Available formats
×

Save book to Dropbox

To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Dropbox.

Available formats
×

Save book to Google Drive

To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Google Drive.

Available formats
×