Peritz, Rudolph J.R. --- "Three Statutory Regimes at Impasse: Reverse Payments in Pay-for-Delay Settlement Agreements between Brand-name and Generic Drug Companies" [2011] ELECD 751; in Drexl, Josef; Grimes, S. Warren; Jones, A. Clifford; Peritz, J.R. Rudolph; Swaine, T. Edward (eds), "More Common Ground for International Competition Law?" (Edward Elgar Publishing, 2011)

Book Title: More Common Ground for International Competition Law?

Editor(s): Drexl, Josef; Grimes, S. Warren; Jones, A. Clifford; Peritz, J.R. Rudolph; Swaine, T. Edward

Publisher: Edward Elgar Publishing

ISBN (hard cover): 9781849803946

Section: Chapter 11

Section Title: Three Statutory Regimes at Impasse: Reverse Payments in Pay-for-Delay Settlement Agreements between Brand-name and Generic Drug Companies

Author(s): Peritz, Rudolph J.R.

Number of pages: 9

Extract:

11. Three statutory regimes at impasse:
Reverse payments in pay-for-delay
settlement agreements between
brand-name and generic drug
companies
Rudolph J.R. Peritz

Bayer AG recently paid $398 million to generic competitors in exchange
for their promise to stay off the market for Ciprofloxacin for the next six
years.1 Cipro, as it is called, is a widely used antibiotic. In these agreements
to settle patent infringement cases, Bayer made reverse payments ­ so
called because they were paid by the plaintiff patent holder to the accused
infringers.2
There is outrage in the United States over these pay-for-delay agree-
ments. President Obama's proposed budget declares that his `adminis-
tration will prevent drug companies from blocking generic drugs from
consumers by prohibiting anticompetitive agreements and collusion
between brand name and generic drug manufacturers intended to keep
generic drugs off the market.'3 The most recent Bill to prohibit such
settlement agreements has recently been sent to the United States Senate
from the Judiciary Committee.4 The public outrage and political responses


1 In re Ciprofloxacin Hydrochloride Antitrust Litigation, 363 F Supp 2d 514

(EDNY 2005), aff'd, 544 F.3d. 1323 (Fed. Cir. 2008).
2 Useful treatments of this subject include CS Hemphill, `Paying for Delay'

(2006) 81 NYU L Rev 1553; C Shapiro, `Antitrust Limits to Patent Settlements'
(2003) 34 Rand J Econ 31; M O'Rourke and JF Brodley, `An Incentives Approach to
Patent Settlements' (2003) 87 Minn L Rev 1767; M Carrier, `Unsettling ...