The US Supreme Court Issues First Ruling on Antitrust Legality of Reverse-Payment Drug Patent Settlements (Actavis)

Abstract

This short article summarizes FTC v. Actavis, the first case in which the Supreme Court analyzed the antitrust legality of agreements by which brand-name drug companies pay generics to settle patent litigation and delay entering the market.

It concludes that the ruling must be counted as a win for the FTC since the most likely alternative analysis — the "scope of the patent" test applied by the dissent and several appellate courts — would have meant "game over" for challenges to these concerning agreements.

Keywords: Pharmaceuticals, settlements, reverse payments, pay for delay, patent, antitrust, Hatch Waxman, brands, generics

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