Antitrust and Intellectual Property: Recent Developments in the Pharmaceuticals Sector

William Michael, Aidan Synnott, Sep 24, 2009

During his campaign for the Presidency, then-Senator Barack Obama promised that he would direct his administration to reinvigorate antitrust enforcement, placing special emphasis on competition in health care and pharmaceuticals. Among other things, he promised to œensure that the law effectively prevents anticompetitive agreements that artificially retard the entry of generic pharmaceuticals onto the market . . . . That promise has been echoed by President Obama’s choice to head the Federal Trade Commission (FTC), Jon Leibowitz, long an outspoken critic of so-called reverse settlement or pay-for-delay agreements between manufacturers of branded and generic pharmaceuticals.

More recently, the Antitrust Division of the Department of Justice (DOJ), under new Assistant Attorney General Christine Varney, has taken a significantly more aggressive stance toward such agreements than the DOJ has taken before. As yet, however, the policy position advanced by the FTC, and now adopted by the DOJ, has not gained acceptance in any federal court of appeals. And recent Supreme Court and Courts of Appeals decisions have had the effect of limiting, rather than expanding, the range of antitrust claims that may be brought against holders of pharmaceutical patents for their conduct in the marketplace”especially when such conduct is unilateral. The practical effect of the agencies’ stated commitment to heightened enforcement in the pharmaceutical sector, therefore, may be limited by their ability to articulate theories of anticompetitive harm that the federal courts deem viable.