FTC v. Actavis

The U.S. Supreme Court’s decision yesterday in FTC v. Actavis, Inc. brings some resolution to the decade-long dispute over the level of antitrust scrutiny that is appropriate for evaluating the legality of “reverse-payment” or “pay-for-delay” agreements settling pharmaceutical patent infringement litigation between brand-name and generic drug companies.  Writing for a 5-3 majority in Actavis, Justice Breyer rejected both the scope-of-the-patent test and the presumptive illegality approach, and held instead that courts should review reverse-payment settlements under the rule of reason.   Or say the opinion states.  In reality, the Court appears to have all but in name adopted the presumptive illegality approach it purported to reject.  One might speculate about the political or prudential considerations that went into the majority’s characterization of what it was actually doing, but as I read the opinion reverse-payment settlements of the type at issue in Actavis are now subject to a de facto regime of presumptive illegality.  I have completed a brief essay on the case, which interested readers can access here; see if you agree or disagree with my analysis.

Posted on June 18, 2013, in Patent and tagged , , , . Bookmark the permalink. Comments Off on FTC v. Actavis.

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