EU Commission Publishes Fifth Report On Patent Settlements In the Pharmaceutical Sector
The European Commission published its Fifth Monitoring Report of Patent Settlements today. Patent settlements enable patent-related disputes to be resolved without having to litigate issues such as patent validity or patent infringement. The Commission takes the view that patent settlements can infringe competition law when they prompt generic suppliers to delay entry in return for a value transfer from the originator to the generic company (which may take the form of a commercial benefit other than a payment). However, in the report the European Commission acknowledges that there is no presumption that patent settlements violate competition rules, noting that a case-by-case analysis is required.
The statistics provided in this report show that the number of patent settlements is increasing. Between January and December 2013 there were 146 patent settlements (compared to 24 between January 2000 and June 2008). However, only a small percentage (8%) of these patent settlements might attract competition law scrutiny because the Commission takes the view that the settlements limited entry of generics. During the European Commission’s pharmaceutical sector inquiry (concluded by 2009), concerns were expressed that the Commission’s investigation of settlements could push companies to litigate each patent dispute. Today’s figures suggest that that has not been the case.