The US Court of Appeals for the Third Circuit holds that reverse payment settlements between brand name and generic pharmaceutical manufacturers may be unlawful under the rule of reason (Schering-Plough)

On July 16, 2012, in an opinion authored by Judge Sloviter [1], the Third Circuit issued its decision in the K-Dur “reverse payments” case [2], holding that although such settlements are not illegal per se, they are presumptively unlawful under the rule of reason. In so doing it rejected the approach adopted by the Second, Eleventh, and Federal Circuits, all of which have held that a settlement that does not restrain trade beyond what would result if the patent holder won the litigation is not unlawful, regardless of the existence of a reverse payment. Although the FTC was not a party to the case, in its amicus brief it urged the approach adopted by the Third Circuit [3], and the decision represents a long-sought win by the FTC, which has been frustrated by its uninterrupted string of

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Authors

  • Arnold & Porter Kaye Scholer (Washington)
  • Hooper Hathaway (Michigan)

Quotation

Jonathan Gleklen, Adam Linkner, The US Court of Appeals for the Third Circuit holds that reverse payment settlements between brand name and generic pharmaceutical manufacturers may be unlawful under the rule of reason (Schering-Plough), 16 July 2012, e-Competitions Intellectual property, Art. N° 53014

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