Nearly two years after the U.S. Supreme Court’s decision in Federal Trade Commission v. Actavis, 133 S. Ct. 2223 (2013), “reverse payment” settlements in patent litigation between brand-name drug manufacturers and potential generic entrants remain a hot topic in the antitrust world. At the American Bar Association’s Antitrust Law Spring Meeting, held in Washington, D.C., last month, reverse payments were discussed at numerous sessions, including one session devoted exclusively to the topic.
Reverse payments are payments made in connection with the settlement of patent litigation between the manufacturer of a brand-name drug and a competitor seeking to market a generic version of that drug. They are called reverse payments because they flow in the opposite direction from that expected in a litigation settlement. They are payments from the brand-name manufacturer plaintiff (the party claiming patent infringement) to the generic competitor defendant (the party accused of patent infringement).
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