I have blogged previously here and here on pay-for-delay drug patent settlements and FTC Chair Jon Leibowitz's campaign to limit them. In pay-for-delay settlements, a brand-name drug company pays a generic company that has challenged the brand-name company's patent to stay out of the market. Some early antitrust challenges to these settlements succeeded, but later court of appeals' rulings have given them a green light. In addition to seeking a limit from Congress, the FTC has been trying for some time to get the antitrust issues before the Supreme Court.
This new column by Michael Hiltzik of the LA Times provides an excellent overview. Here's an excerpt that nicely synopsizes the adverse impact of consumers:
The brand and generics makers insist that these deals are consumer-friendly. But the game was given away in 2006 by Frank Baldino, then the chief executive of Cephalon. According to a lawsuit filed by the Federal Trade Commission, Cephalon paid a total of $200 million to several generics companies to get them to drop patent challenges to its narcolepsy drug Provigil. The deals staved off competition from no-name rivals until 2012. "We were able to get six more years of patent protection," Baldino crowed publicly. "That's $4 billion in sales that no one expected." "It's a great business plan if you can get away with it," FTC Chairman Jon Leibowitz told me. "But it turns the market on its head, because generics earn more money by not competing than they would by entering the marketplace."