Media Release: NLARx Files Amicus Brief in Pay for Delay Lawsuit

NLARx and Leading Consumer Groups File
Amicus Brief Seeking Further Review of

Pay-for-Delay Settlements

NLARx JOINS LEADING CONSUMER GROUPS TO CHALLENGE COZY SETTLEMENT DEALS THAT JACK UP PRESCRIPTION DRUG PRICES

May 21 -- The National Legislative Association on Prescription Drug Prices and three other leading consumer public interest groups - Consumers Union, Consumer Federation of America and U.S. PIRG - have filed an amicus brief in the Second Circuit Court of Appeals asking the court to rehear the Cipro case en banc.

"We are seeking an en banc rehearing to give the court the opportunity to revisit its Tamoxifen opinion which we believe will lead to the continuing escalation of prescription drug prices in violation of the language, intent and spirit of the the applicable federal law," said Sharon Treat, NLARx Executive Director.

The amicus brief asserts that the Court's decision "inappropriately permits patent holders to contract their way out of the statutorily imposed risk that patent litigation could lead to invalidation of the patent while claiming antitrust immunity for that private contract."

The so-called "pay-for-delay" settlements deprive consumers of significant benefits from price competition. The brief also notes that:

These settlements cost consumers billions of dollars per year and block access to affordable generics.

These settlements are possible because of a perverse incentive created by the Hatch-Waxman Act. That act grants 180 days of exclusivity to the first generic firm to file a challenge to a branded drug's patent, thus giving that first-filer the ability to accept a payment in the form of a settlement and "park" that exclusivity. The authors of Hatch-Waxman, however, have spoken out against these anticompetitive settlements, which go against the spirit and intent of the law -- in the words of Representative Waxman, to ensure the provision of "low-cost, generic drugs for millions of Americans."

Reverse payments are not necessary to settle these cases.

The brief was authored by Professor Michael Carrier of Rutgers Law School - Camden and Washington, D.C. attorney David Balto.

About the National Legislative Association on Prescription Drug Prices

NLARx is a non-partisan, non-profit organization of state legislators from across the country working to lower prescription drug costs and improve access to affordable medicines. Members include legislators from states in all regions of the country, from New England to Alaska and Hawaii and the District of Columbia. For more information and to sign up for our electronic newsletter, visit our website or join our facebook page