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Regulatory Focus™ > News Articles > Reps. Waxman, Rush Introduce Bill to Stop 'Pay-For-Delay' Settlements

Reps. Waxman, Rush Introduce Bill to Stop 'Pay-For-Delay' Settlements

Posted 13 February 2012

A bill introduced by Representatives Bobby Rush (D-IL) and Henry Waxman (D-CA) on 9 February would end so-called "pay-for-delay" settlements used by pharmaceutical companies to delay competition from generic competitors.

The bill, Protecting Consumer Access to Generic Drugs Act of 2012 (H.R. 3995), declares it "unlawful for any person to directly or indirectly be a party to any agreement resolving or settling a patent infringement claim in which (1) an [Abbreviated New Drug Application (ANDA)] filer receives anything of value; and (2) the ANDA filer agrees not to research, develop, manufacture, market, or sell, for any period of time, the drug that is to be manufactured under the ANDA involved and is the subject of the patent infringement claim."

Under current regulations, the first company to file an ANDA-an application to market a generic version of an existing marketed product-gains 180 days of market exclusivity. Companies with products that are going off-patent sometimes pay these generic competitors not to market their products in return for a settlement or payment.

To Rush, these agreements are "anticompetitive arrangements" that-while currently legal-are harming consumers.

 "Currently, these arrangements have generally been held to be legal but they hurt consumers and increase the cost that taxpayers pay to fund Medicare and Medicaid," said Rush in a statement released on his website. Rush further cited a Congressional Budget Office report saying that the deals could "cost taxpayers roughly 35 billion dollars over ten years."

In addition to Waxman, Rush is joined by cosponsors Chris Van Hollen (D-MD), Jan Schakowsky (D-IL), Frank Pallone (D-NJ) and G.K. Butterfield (D-NC).

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