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Court Ruling Give FTC Greater Scrutiny Over "Pay-for-Delay" Deals

06/18/13

  10:11:09 am, by MedBen5   , 196 words,  
Categories: News, Prescription

Court Ruling Give FTC Greater Scrutiny Over "Pay-for-Delay" Deals

In a 5-3 ruling, the Supreme Court ruled yesterday that the Federal Trade Commission can give additional scrutiny to so-called “pay-for-delay” arrangements between generic and brand-name drug companies, The New York Times reports. Justice Samuel Alito recused himself for the decision.

Brand name drug manufacturers sometimes pay competitors to keep generic versions of their products off the market. While the court did not address the legality of such agreements, it did effectively overturn a lower-court ruling that said they were lawful, so long as a deal did not keep a generic drug off the market beyond the term of the brand-name drug’s patent.

The FTC, which has fought pay-for-delay for over a decade, had hoped the court would find that the practice violated antitruat laws. But the ruling did give the agency – as well as consumer groups, drug retailers, wholesalers and insurance companies – the ability to challenge any deals it deemed questionable.

Justice Stephen G. Breyer, writing for the majority, said that “a court, by examining the size of the payment, may well be able to assess its likely anticompetitive effects along with its potential justifications without litigating the validity of the patent.”

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