December 4th, 2013
The makers of branded pharmaceuticals have devised numerous ways to extend patent exclusivity for lucrative products in the United States. In June, the Supreme Court gave the Federal Trade Commission (FTC) clear authority to investigate and prosecute one of them, “pay-for-delay” agreements, but stopped short of making such deals presumptively unlawful restraints of trade. In the case the court decided, a manufacturer of a branded drug, a testosterone replacement patch, paid the maker of the generic to refrain from entering the domestic market with its product.
The more dramatic battles over the timing of a drug’s transition from branded to generic form are being fought in cancer. Cancer is the second-leading cause of death in the United States. Americans spent $157 Billion (B) on cancer care in 2010; $23B or 18 percent of total spending was devoted to oncologics, a 41 percent increase since 2006 and largely paid for by Medicare. Between 2006 and 2011, cancer drugs were the second most commonly litigated generic drug treatment class (70 unique cases), following cholesterol-lowering agents (123 unique cases).
Here, I argue that outsized potential profits, limited competition, and strong demand makes cancer drugs attractive for patent disputes. Several oncologics due for upcoming patent expiration illustrate important opportunities and caveats under current law. The outcomes of these and other cases will have significant consequences for cancer patients and their insurers.Read the rest of this entry »