"That's almost an epidemic," Leibowitz said, "Left untreated, these types of settlements will continue to insulate more and more drugs from competition. Every single FTC commissioner—going back through the Bush and Clinton administrations?has supported stopping these unconscionable agreements."
The tide, though, on these cases may be turning around," Leibowitz said. A few months ago, an appellate panel in the Second Circuit, which had previously adopted a permissive approach to pay-for-delay settlements, took the step of questioning its own standard and explicitly encouraged consumer plaintiffs to request the court's re-consideration of the pay-for-delay issue.
Both the FTC and the Justice Department filed briefs with the Second Circuit advocating that the full court revisit this issue. In another development in March 2010, a federal district court judge in Philadelphia denied a defense motion to dismiss the Commission's case against Cephalon. That case is now in the discovery phase.