Jeff Lagasse
Sep 12, 2023
Improperly listing patents may harm competition from generic alternatives and keep prices artificially high, the FTC says.
The Federal Trade Commission has issued a policy statement warning pharmaceutical companies that make and sell brand-name drugs that they could face legal action if they improperly list patents in the FDA's catalog of "Approved Drug Products with Therapeutic Equivalence Evaluations," commonly known as the "Orange Book." This policy has been endorsed by the U.S. Food and Drug Administration.
Improperly listing patents in the Orange Book may harm competition from less expensive generic alternatives and keep prices artificially high, according to the policy statement. The FTC will scrutinize improper Orange Book patent listings as potential unfair methods of competition in violation of Section 5 of the FTC Act.
FTC Chair Lina M. Khan said that these listings illegitimately delay or bar generic manufacturers from entering the market. This, she said, deprives people of access to lower-cost drugs, prompting the agency to combat what it sees as illegal practices that are inflating the price of medicines.
In support of this position, the FDA said it "stands ready to assist the FTC as part of our long history of collaboration to protect American consumers, including our continued engagement under the Executive Order on Competition in the American Economy to help identify and address efforts to block or delay generic drug and biosimilar competition."
WHAT'S THE IMPACT?
The FDA's Orange Book is a list of drug products approved by the agency as safe and effective. When a brand pharmaceutical company lists a patent in the Orange Book, it may lead to a statutory stay that blocks the introduction of competing drug products for up to 30 months, including lower-cost generic alternatives.
Listing patents in the Orange Book can, however, tend to negatively affect competitive conditions if listings are improper, as defined by law, the FTC said.