US pharma patent settlements netted $25.5 billion in savings for health system; report

Generic pharmaceuticals launched prior to patent expiration due to a patent settlement - also called pay-for-delay deals - helped the US health care system save $25.5 billion from 2005 to 2012 and brought generic medicines to market on average 81 months sooner than patent expiry, according to a new analysis conducted for the Generic Pharmaceutical Association (GPhA) by the IMS Institute for Healthcare Informatics.

An additional $61.7 billion will be saved if the current level of savings continues through to patent expiry for each molecule analyzed, the study projects, the research showed.

"For years, opponents of pharmaceutical patent settlements with consideration have stated that settlements create a cost for consumers, the government and others. This new analysis provides the most current, complete and transparent estimate of the impact of patent settlements on health costs, and it shows that the opposite is true," said Ralph Neas, president and chief executive of the GPhA, adding: "In particular, the new analysis estimates that patent settlements – including those with consideration – have led to billions in savings. For example, the settlement involving Lipitor [atorvastatin; Pfizer’s once mega blockbuster cholesterol lowerer] alone will save $22 billion over the next four years. This is critical for lawmakers to understand, because any further restrictions on settlements will put these savings at risk."