Drug Patent Settlements Between Rivals: A Survey

Posted by D. Daniel Sokol

Scott Hemphill of Columbia University Law School has an important new paper out on a subject that has been at the forefront of many policy discussions in recent years on patent settlements.  His paper is entitled Drug Patent Settlements Between Rivals: A Survey.

ABSTRACT: This survey provides a detailed account of patent settlements reached between innovator drug companies and their generic rivals over the past fourteen years, and the antitrust suits and investigations initiated in response. Twenty-nine settlements of patent litigation involving twenty drugs fall within the scope of the study. Three basic patterns emerge from the data. First, antitrust activity in this area has continued to expand, including more than a dozen pending antitrust suits and agency investigations. Second, repeat players have emerged. For example, a single generic firm has reached settlements with respect to eight different drugs. Third, drug patent settlements have grown more sophisticated. A second wave of settlements, in which a generic firm provides value to the innovator that is distinct from delayed entry, complicates antitrust evaluation of the agreements.