Federal Judge Limits Antitrust Scrutiny of Pharmaceutical Reverse Payments to Settlements Involving Monetary Transfers
07 February 2014Antitrust, Competition and Economic Regulation Alert
Recently, a federal judge in the U.S. District Court for the District of New Jersey held that only patent settlements involving a reverse monetary payment will be subject to antitrust scrutiny under the framework articulated by the Supreme Court last year in FTC v. Actavis. In affirming its earlier ruling dismissing the direct purchaser complaint, the court held that nothing in Actavis altered the conclusion it had reached previously under the U.S. Court of Appeals for the Third Circuit's ruling in In re K-Dur Antitrust Litigation that the settlement did not, in fact, contain a reverse "payment" because there was no transfer of money between the parties. This most recent development in the ongoing debate regarding these agreements is significant not only because it is the latest effort by the courts to clarify and develop the framework put in place under Actavis but also because it constitutes a departure from other recent district court rulings that have suggested that Actavis may apply to non-monetary forms of compensation.