Teva & Gilead Prevail in $3.6 Billion "Pay for Delay" Suit

I haven't seen much discussion of this verdict handed down by a federal jury on Friday out in California that cleared the two pharmaceutical companies of antitrust liability. As reported by thepharmaletter's "Brief," consumers and other direct purchasers, including the Blue Cross and Blue Shield Association, filed the antitrust lawsuit in 2019 in which they alleged Gilead Sciences and Teva Pharmaceutical Industries entered into an illegal "pay for delay" patent deal that inflated prices for two HIV medications. The jury found that plaintiffs had not shown Gilead had market power or that it paid Teva to delay its generics, IP Law 360 reported.

The FTC has a good website on "Pay for Delay: When Drug Companies Agree Not to Compete." The policy against "pay to delay" seems sound. Usually to settle a private patent infringement suit between two drug manufacturers (which itself may or may not be hatched for this sole purpose), the practice amounts to extended patent protection for the original drug beyond what is contemplated by the Hatch-Waxman Act. That protection keeps a lower-cost generic off the market and allows the original patentee to reap what amounts to monopoly profits.

Good policy, but if the facts aren't there, the case will fail. It will be interesting to read the details surrounding this verdict in the days and weeks ahead.