December 15, 2020
Cadwalader Intellectual Property Group chair and partner Dr. Dorothy Auth last week participated in a program hosted by the New York Intellectual Property Law Association President’s Forum titled, “States Rights: Should States Legislate IP on the Pharma Sector?,” that addressed California legislation in the pharmaceutical space and how it interacts with Federal Law.
The town-hall style meeting gathered experts from a range of backgrounds, representing academia, trade associations and private industry.
The featured speakers included Hon. Faith Hochberg, District Judge, U.S. District Court for the District of New Jersey (Ret.); Karin Hessler, Assistant General Counsel, Association for Accessible Medicines; David Korn, Vice President, Intellectual Property and Law, Pharmaceutical Research and Manufacturers of America; Jay Lefkowitz, Partner, Kirkland & Ellis; Arti Rai, Professor of Law, Faculty Director, The Center for Innovation Policy at Duke Law; Corey Salsberg, Vice President, Global Head IP Affairs, Novartis; and Rebecca Wolitz, Post-Doctoral Research Fellow, PORTAL, PhD Candidate, Yale University. The discussion was moderated by Dr. Auth and Willkie Farr & Gallagher partner Michael Johnson.
The discussion focused on how various states (and the federal government) are legislating to make reverse payment patent settlements in pharmaceutical Abbreviated New Drug Application (ANDA) litigations presumptively anti-competitive and illegal. The panelists pointed to one such statute enacted into law in California, where a preliminary injunction action to block the law is currently pending.
The discussion leaders considered the dangers of such laws, including dormant commerce clause issues, preemption, territorial scope and penalties. Alternatives to these statutes were proposed, including giving the judges in such cases broad authority to determine the anticompetitive nature of proposed settlements in order to avoid a latent potential claim being brought many years after the settlement.
The group also discussed another new California statute that allows the State government to engage with manufacturers and/or distributors in the production and distribution of generic drugs. The discussion leaders addressed how a State’s participation in the ANDA process could lead to issues such as sovereign immunity and how State participation in the generic drug market could undermine the federal Hatch-Waxman system of generic drug approval.
The discussion also covered the issue of whether these new laws violated the U.S. Supreme Court’s decision in FTC v. Actavis, which held that pharmaceutical ANDA settlements are not per se anti-competitive and that such agreements require a review under the Rule of Reason doctrine.
Dr. Auth chairs Cadwalader's Intellectual Property Group and is based in the firm's New York office. She coordinates global intellectual property enforcement, licensing and procurement strategies for her clients to maximize their protected field, with experience that spans diverse industries, including biotechnology, pharmaceutical, and medical devices, as well as consumer products, computers, and other mechanical devices.
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