Gary Blakeley /
8 November 2016Americas

SCOTUS denies review of GSK, Teva competition case

The US Supreme Court yesterday denied a petition for certiorari in a case centring on Lamictal (lamotrigine), a treatment for certain types of seizures as well as bipolar disorder.

GSK and Teva had filed the petition back in February after the US Court of Appeals for the Third Circuit held, according to the pharmaceutical companies, “that a patentee’s grant of an exclusive licence must undergo antitrust scrutiny by courts and juries”.

GSK asked whether this holding is inconsistent with the Supreme Court’s decision in FTC v Actavis (2013).

In Actavis, the Supreme Court held that unexplained large payments from a drug patent owner to an alleged infringer to settle litigation over validity or infringement (‘reverse payment’) can sometimes violate the antitrust laws.

The case involving Teva and GSK originally arose after Teva challenged the validity and enforceability of GSK’s patents on Lamictal.

A judge ruled that GSK’s main patent claim was invalid. GSK and Teva then settled.

The companies agreed that Teva would end its battle against GSK’s patents in exchange for early entry into the lamotrigine chewables market, worth $50 million annually.

GSK also committed not to produce its own  authorised generic (AG) version of Lamictal tablets for the market, which is worth $2 billion annually.

King Drug Company of Florence and Louisiana Wholesale Drug Company, which filed complaint against GSK and Teva, argued that the agreement not to produce an AG qualified as a reverse payment.

The case found itself at the Third Circuit, which said in its opinion that the settlement between the two parties eliminated the risk of competition in the market “for longer than the patent’s strength would otherwise permit”.

In its June 2015 ruling, the appeals court said that the no-AG agreement fell under the Supreme Court’s Actavis ruling, because it may represent “an unusual, unexplained reverse transfer of considerable value from the patentee to the alleged infringer and may therefore give rise to the interference that it is a payment to eliminate the risk of competition.”

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