President Obama’s appointment of Jon Leibowitz as the Chairman and head of the Federal Trade Commission (“FTC” or “Commission”) will likely precipitate the resolution of a lingering antitrust question in the pharmaceutical industry: Does it violate the antitrust laws for a branded drug company to settle a patent infringement lawsuit by paying an alleged generic infringer millions of dollars not to market its lower-cost version of the drug? Courts generally permit such payments so long as they don’t “settle” sham litigation or exceed the scope of the patent protection. Chairman Leibowitz has called these judicial decisions “misguided,” however. He, President Obama, and their like-minded friends in Congress prefer the FTC’s historically favored approach that would deem anticompetitive any agreement where a brand pays a generic a large sum to delay entry.

Click here to view memo, New FTC Chairman Leibowitz Will Seek Demise of Pharmaceutical “Pay-for-Delay” Settlements