FTC Staff Report Criticizes Pharmaceutical Patent Settlements

On January 13, 2010, the U.S. Federal Trade Commission released a staff report entitled "Pay-for-Delay: How Drug Company Pay-Offs Cost Consumers Billions." (http://tinyurl.com/yfvesl3) As the title suggests, the report is a political document more than a helpful guideline. This "FTC Staff Study" is a very short summary of work that the staff performed on settlements of Hatch-Waxman litigation between branded and generic pharmaceutical companies. The report is part of a longstanding FTC effort designed to achieve in Congress what the FTC has failed to accomplish in antitrust challenges to these settlements in court: a prohibition of all Hatch-Waxman patent settlements except those that grant entry to a generic firm prior to patent expiration, without any direct or indirect compensation going from the branded to generic firm.