A “reverse payment” settlement agreement is not entitled to “near-automatic antitrust immunity” simply because its anticompetitive effects fall within the scope of the exclusionary potential of the patent, the U.S. Supreme Court ruled earlier this week in a five-to-three decision. Although such agreements, also known as “pay-for-delay” settlements, are not presumptively unlawful, the FTC should be permitted to challenge reverse-payment agreements between Solvay Pharmaceuticals and would-be generic competitors Watson Pharmaceuticals (now Actavis, Inc.) and Paddock Pharmaceuticals under a rule of reason analysis. The case is FTC v. Actavis, Inc., Dkt. No. 12-416. Reverse payment agreements generally involve a brand-name drug manufacturer paying a potential rival to abandon patent challenges
The US Supreme Court opens reverse payment patent settlement agreements to antitrust challenge (Actavis)
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