FTC to Bar Teva From Making Reverse Payment Patent Settlements
The Federal Trade Commission (FTC) late Tuesday announced a settlement resolving pending claims in three separate federal court antitrust lawsuits involving subsidiaries of Teva Pharmaceuticals.If approved by the various courts, the settlement, which does not include a fine, will prohibit Teva from engaging in reverse-payment patent settlement agreements that can restrict access to cheaper generic drugs.
FTC Chairman Joe Simons said: “This broad settlement prevents the world’s largest manufacturer of generic drugs from entering into collusive agreements that prevent price competition by keeping generic drugs off the market.”
Although Teva is currently bound by a prior order in FTC v. Cephalon, the FTC says the new order is broader because that prior order did not prohibit commitments related to authorized generics.
The new order, which would last for 10 years, prohibits Teva from entering into the two most common forms of reverse payments: “(1) a side deal, in which the generic company receives compensation in the form of a business transaction entered at the same time as the patent litigation settlement; and (2) a no-AG commitment, in which a brand company agrees not to compete with an authorized generic version of a drug for a period of time,” the FTC said.
The order also avoids the costs and risks of trial and appeals in three pending cases also involving AbbVie and Allergan.
Last July, AbbVie had to pay a $448 million disgorgement for using anticompetitive tactics to delay generic competition for its blockbuster testosterone replacement therapy Androgel. The ruling stemmed from a 2014 complaint filed by the FTC, alleging the companies filed "baseless" patent infringement suits against generic drugmakers Teva Pharmaceuticals and Perrigo.
FTC