US President and FTC still believe legislation banning pay-to-delay settlements needed

While brand-name and generic drug makers are applauding the latest change to the US House of Representatives' health care reform bill - eliminating the ban on patent settlements, or pay-to-delay arrangements, which are not included in the Senate version (The Pharma Letter March 18), such legislation is still supported by President Barack Obama.

The measure, which was backed by the Federal Trade Commission, would in most cases have barred these settlements of patent cases brought by generic companies against brand-name drug makers. In such cases, the brand-name pharmaceutical firm pays the generic company to delay the market entry of a lower-cost generic drug alternative.

FTC Chairman Jon Leibowitz said the agency 'will continue working on behalf of Americans who are struggling to pay for their health care. According to our economic estimates, consumers would pocket about $3.5 billion a year if these unconscionable deals were stopped and they had earlier access to generic drugs. It's not a question of whether this should happen, but when.'