In Federal Trade Commission v. Watson Pharmaceuticals (12-0416 WL 4758105 (2012)), the Court must decide if generic drug companies can agree with potential rivals owing patented drugs to stay out of the market until those patents expire, or whether such agreements violate antitrust laws.
“The Federal Trade Commission (FTC) estimates the agreements cost consumers $3.5 billion yearly as companies share the profits,” the professor explained.
Supporters say these agreements are within the scope of their patent rights and serve as an efficient way to avoid costly litigation. The Court took the case to resolve a split between federal courts on the issue.
“This case is one battle in a much larger war,” Lim predicts. “If the agreements are upheld, the FTC will continue the fight through legislative reform. If the FTC wins, such payments will become presumptively illegal but patent owners have other strategies to exclude their generics competitors.
“One controversial strategy involves making small non-therapeutic changes to drug formulations and withdrawing the original before generic competitors enter,” he said. “This allegedly forces patients to switch to the reformulated patented drugs. Future battles notwithstanding, any clarity the Court can provide will be valuable.”
And lastly, Monsanto v. Bowman (133 S.Ct. 420 (2012)) involves the right of farmers to replant second or later generation genetically modified seeds they bought with the
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