Pharmaceutical Law

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The Patent Trap: The Struggle for Competition and Affordability in the Field of Biologic Drugs

Issues Volume 54, Issue 4

By Charlotte Geaghan-Breiner

The biologic drug market in the U.S. suffers from a dearth of competition. Ten years after the passage of the Biologics Price Competition and Innovation Act (BPCIA), competition from biosimilars remains weak, and prices of branded biologics continue to increase at rates that outstrip inflation. This crisis of non-competition has resulted in billions of dollars in lost savings and reduced access to treatment, especially for vulnerable groups. Patent thickets — dense webs of overlapping patents — are one of the main barriers to biosimilar competition. By protecting their products with patent thickets, branded biologic manufacturers are able to deter competition from biosimilars and maintain periods of market exclusivity that far exceed statutory limits. This Note analyzes regulatory gaps in the BPCIA that allow patent thickets to thrive, and recommends both legislative and administrative solutions. Part II assesses the market landscape for biologic drugs in the U.S. and concludes that, of all barriers to biosimilar competition, patent thickets are the most significant. Part III evaluates the BPCIA framework in light of patent thickets and identifies aspects of the statute that allow patent thickets to block biosimilar market entry. Part IV analyzes recent legislative proposals to address the problem of patent thickets, and recommends administrative changes to strike a better balance between innovation and competition in the field of biologics.

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Molecule Size Doesn’t Matter: The Case for Harmonizing Antitrust Treatment of Pay-for-Delay Agreements

Issues Volume 54, Issue 2

By Morgan Marmaro

With notoriously the most-expensive drug prices in the world, the United States has failed to use all of the tools in its shed to combat the unending upwards trend. One such important tool is U.S. antitrust law that targets companies that improperly charge monopoly and supracompetitive prices long past their original patent’s expiration. Some companies have found a way to game the regulatory approval system by suing would-be generic competitors and then, under the guise of settlement, paying them to delay their market entry — allowing a brand drug manufacturer to maintain their monopoly prices and continue raking in large profits. The Actavis Supreme Court found these agreements involving reverse payments — also known as pay-for-delay — can violate antitrust laws even in light of the existing patents. This Note argues that in an ongoing case, In re Humira that examines reverse payments between biologic drug companies, the district court was right to engage in an Actavis analysis but did so improperly. In re Humira provides a prime opportunity to strengthen and clarify U.S. jurisprudence on reverse payments and market allocations to reduce ambiguity in an evolving pharmaceutical sphere: biologics and biosimilars. This Note further argues that to harmonize the antitrust treatment of pharmaceuticals — small molecule and biologic — both clear judicial standards and legislation are needed.

This Note proceeds in four parts. Part II discusses various forms of antitrust abuses that arise in the pharmaceutical sphere and that often accompany reverse payment agreements. It follows with the relevant legal and regulatory backgrounds of small and large molecule drugs. Part III then considers the consequences of lax antitrust scrutiny on pharmaceuticals and finishes with an in-depth examination of the In re Humira litigation. Lastly, Part IV proposes a two-fold solution, legal and legislative, to the problems posed by Actavis’s lack of legal clarity. Ultimately, the purpose of this Note is to demonstrate that the way a drug is manufactured, approved, or allowed to compete does not alter the application of antitrust law seeking to rid the market of collusive agreements between rivals.

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