Latest Legislative Attempt on Reverse Payment ANDA Settlements

On February 9th, Congressman Bobby Rush (former "defense minister" of the Black Panther Party and representative for the Illinois 1st Congressional District; at right) joined Congressman Henry Waxman (below) in introducing the latest legislative measure directed at preventing reverse payment settlements of lawsuits under 35 U.S.C. § 271(e)(2) between branded innovator pharmaceutical companies and their generic competitors.  The bill, named the "Protecting Consumer Access to Generic Drugs Act of 2012" (H.R. 3995), was introduced "[t]o prohibit brand name drug companies from compensating generic drug companies to delay the entry of a generic drug into the market, and for other purposes."  The two Congressmen were also joined by Reps. Chris Van Hollen (D-MD), Frank Pallone (D-NJ), G.K. Butterfield (D-NC), and fellow Illinois Rep. Jan Schakowsky.

The bill would prohibit "any person" to be a party to an agreement "resolving or settling a patent infringement lawsuit" in which an ANDA filer "receives anything of value" and the ANDA filer agrees "not to research, develop, market, or sell, for any period of time, the drug" that is the subject of the ANDA and the patent infringement lawsuit.  The bill excepts settlements where the only "value" received by the ANDA filer is the ability to market the drug before expiration of the patents in the infringement lawsuit or before expiration of "any other statutory exclusivity that would prevent the marketing of such drug," presumably including exclusivities under the Federal Food, Drug and Cosmetic Act (FFD&CA), or waiver of damages accrued by ("at-risk") sales of a drug before the lawsuit is settled.  (This section 2 of the bill is blithely entitled "Unfair and Deceptive Acts and Practices related to New Drug Applications.")

Rep. Rush describes the intent of these provisions on his home page.  "Currently," he explains, "these arrangements have generally been held to be legal but they hurt consumers and increase the cost that taxpayers pay to fund Medicare and Medicaid."  These settlements "cost[] consumers billions of dollars" (noting that the Congressional Budget Office estimates that the cost "could be" "roughly 3 billion dollars over ten years" to taxpayers, raising the (unanswered) question of why that estimate is so carefully qualified.  The Congressman also believes that...

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