2025: Reverse-Payment Settlements Unleashed

Abstract

The year is 2025. For the past two decades, brand-name drug companies have settled infringement lawsuits with generic firms by paying them to drop their patent challenges. Early in the 21st century, courts had explained that this was the natural state of affairs. By 2025, this is true many times over.

This short article offers three predictions for drug patent settlements in the next 15 years:

1. The Eastern District of Pennsylvania court will deny summary judgment in the Cephalon case.

2. The Supreme Court will grant certiorari, and affirm, in the 2nd Circuit Cipro case.

3. Congress will pass reverse-payments legislation.

Going even further out on a limb, the first two predictions will occur in 2011 and the third will happen in 2017.

Keywords: patent, antitrust, settlement, drugs, pharmaceuticals, reverse payments, Hatch Waxman

JEL Classification: I18, K21, L40, L41, L43, L65, O34, O38