Big Duh! Patent Settlements Save Consumers and the Government Money

The Generic Pharmaceutical Association (GPhA) yesterday released a study showing that patent settlements netted the U.S. healthcare system savings of $25.5 billion dollars over the time period 2005-2012.  The GPhA press release can be found here

The saving from patent settlements is something those of us involved in the generics industry have been touting for years.  So what is all the argument about?   And why did this issue have to go all the way to the Supreme Court when it seems clear that if a generic can come to market years before the patent expiration (according to the press release, an average of 81 months before) at a lower price, then not only the consumer wins, but so does the Federal Government who pays about 1/3 of all drug costs in this country?

Additionally, due to patent settlements (and, in some instances, the introduction of Authorized Generics [AG] under these agreements), the 30-month clock actually can be triggered with the initial marketing of the AG, thus allowing other generics to enter the market earlier than otherwise possible.

But statistics can always be manipulated to show what you want.  Opponents to patent settlements have their own set of data they trudge out to make their point.  I don’t know, maybe it is just me, but, personally, I don’t care about patent settlements if both the Federal government and I can save money.  The argument that forcing litigation to the ultimate end to see if the courts find the patent valid or infringed is a risk that the patent settlement process is designed to sidestep.  Thankfully, the Supreme Court found that, like in all industries, the patent settlement is an important process that can serve the public, and that each agreement must be evaluated on its own merit.  This should make lawyers happier as they will yet have someone else to sue!