The US Third Circuit, by adopting a quick look rule of reason analysis for evaluating the legality of reverse payment settlements, rejects the prevailing "scope of patent" test and creates a Circuit split on this issue (Louisiana Wholesale Drug Company, Schering, Upsher-Smith)

On 16 July 2012, the US Third Circuit Court of Appeals rejected the scope of the patent test used by the New Jersey District Court in concluding that the patent settlement agreements (“Agreements”), providing for payments from Schering-Plough Corporation (“Schering”) (subsequently acquired by Merck & Co) to generic drug manufacturers, ESI Lederle (“ESI”) and Upsher-Smith Laboratories (“Upsher”), did not violate antitrust law because the Agreements did not exceed the exclusionary scope of Schering’s patent. Recognizing that whether a restraint of trade violates antitrust law is normally evaluated under the rule of reason, the Third Circuit held that the legality of reverse payment settlements should be evaluated under the quick look (or truncated) rule of reason. Under the rule of reason,

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Yelena Morozova, The US Third Circuit, by adopting a quick look rule of reason analysis for evaluating the legality of reverse payment settlements, rejects the prevailing "scope of patent" test and creates a Circuit split on this issue (Louisiana Wholesale Drug Company, Schering, Upsher-Smith), 16 July 2012, e-Competitions Bulletin Competition in the Pharmaceutical sector, Art. N° 50129

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