Although more drug makers are settling patent infringement lawsuits, the U.S. Federal Trade Commission found that the number of so-called pay-to-delay settlements — which the agency argues unfairly robs Americans of lower-cost alternatives to their prescription medicines — remain very low.
In discussing the findings, which were from fiscal year 2017, agency officials maintained the decline underscores the effects of a 2012 U.S. Supreme Court ruling that such deals can be subject to review for anti-competitive agreements. Since then, the FTC has become more aggressive in challenging some patent settlements between brand-name and generic drug makers.
What is a pay-to-delay deal? This occurs when a brand-name drug maker settles a patent lawsuit by paying cash or transferring something else of value to a generic rival, which agrees to delay launching a copycat medicine until a specific date in the future. This gives the brand-name drug maker more time to sell its medicine without lower-cost competition.
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