Pharma combines these with micro-obstructions to distract from the real issue–focusing on reverse payments is key because they’re the longest-lasting and easiest to achieve—solving them restructures incentives which solves alt causes.
Feldman 16 (Robin Feldman is a law professor, researcher, and author best known for her contributions to intellectual property and health care law. Feldman is the Arthur J. Goldberg Distinguished Professor of Law at the University of California, Hastings College of Law. Feldman is a widely cited expert on intellectual property and health care law, particularly as it relates to the pharmaceutical industry, drug policy, and drug pricing, Evan Frondorf is an academic, a risk strategist, and a journalist. Currently, he’s a member of the Risk Partnerships & Strategy team at Stripe. His previous research focused on intellectual property and pharmaceutical policy. My book, DRUG WARS: HOW BIG PHARMA RAISES PRICES AND KEEPS GENERICS OFF THE MARKET, co-authored with Professor Robin Feldman, is now available via Cambridge University Press. 20 Jun 2016, accessed on 8-8-2021, Harvard Journal on Legislation, "Drug Wars: A New Generation of Generic Pharmaceutical Delay", https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2659308)
As scholarly works by this author and others have noted, agreements not to compete and activities that abuse the regulatory process to block competitors raise antitrust concerns.318 Thus, when pharmaceutical company behavior improperly delays or impedes the entry of generic competition, that behavior runs contrary to the open, competitive market environment for which antitrust law yearns.
The theoretical concerns translate into tangible damage to society as well. With patents, the legal system chooses to tolerate certain societal losses for the innovation effects that may result. When brand-name companies extend their monopoly power beyond the expiration of the patent, however, there are unanticipated deadweight losses to society in the form of higher prices. Whether Congress has chosen the optimal parameters for the patent system is a separate question. Once those parameters are set, behaviors that cause additional deadweight losses for society are contrary to the system’s incentive structure, and the damage to society should not be tolerated.
The Hatch-Waxman manipulations also are damaging to society in the form of activities that are wasteful for companies and institutions alike. Hide-and-seek games that the courts, the FDA, the FTC, and the Patent and Trademark Office are forced to play are wasteful to all. The games are particularly burdensome on the court system, with pharmaceutical litigation over generic competition now joining patent troll litigation as a major component of new patent lawsuit filings.319 Sadly, given the amount of money at stake, the behaviors are likely to continue unless the legal system finds a way to change the incentives or to create sufficient disincentives. This is not to suggest that progress has been negligible. The shift from simple pay-for delay agreements to side deals and then to micro-obstructions reflects the progress that regulatory agencies have begun to achieve in the courts. In addition, although micro-obstructions can create a valuable delay in competition, they are more difficult to achieve and often less lengthy than pay-for delay.
Nevertheless, although the form of the behavior may have shifted, the behavior remains. And although changes such as the Supreme Court decision in Actavis and various congressional amendments have been important, by the time the changes are implemented, the market has moved beyond. The question is, what should come next.