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SCOTUS: pay-for-delay subject to antitrust litigation

June 18, 2013 12:38 AM UTC

The U.S. Supreme Court ruled on Monday in Federal Trade Commission v. Actavis Inc., et al. that pay-for-delay settlements between branded and generic drug manufacturers are not immune from antitrust litigation. The decision overturns a ruling by the U.S. Court of Appeals for the Eleventh Circuit that a pay-for-delay deal between the pharmaceuticals business of Solvay S.A. (Euronext:SOLB) and generic drug manufacturers, including Actavis Inc. (NYSE:ACT; formerly Watson Pharmaceuticals Inc.), was "immune from antitrust attack."

The appeals court had affirmed a district court's dismissal of the suit by the Federal Trade Commission against Solvay, which had paid generic manufacturers to abandon patent challenges and refrain from marketing a generic version of testosterone replacement therapy AndroGel. The U.S. District Court for the Northern District of Georgia dismissed the case because "the FTC had not alleged that the challenged agreements excluded competition to a greater extent than would the patent." ...