Administrative Actavis

December
2016
Monica L. Smith
The cost of prescription drugs, a function of the nexus of patent law and antitrust law, has recently been thrust into the spotlight. In the shadow of the Federal Trade Commission’s vigorous challenges to anticompetitive agreements between branded manufacturers and their potential generic competitors, a new player entered the administrative patent invalidity arena—noncompetitors, such as hedge fund managers, who, despite their reputation for seeking profit at all costs, asserted a seemingly puzzling altruistic interest in invalidating certain patents that prevent generic competitors from entering the market. In light of “abuse of process” accusations and calls for sanctions, this Note suggests that corporate law may facilitate an understanding of the role of noncompetitors in patent invalidation. Using the corporate law phenomenon of greenmail as an analogy, this Note argues that noncompetitors may actually facilitate competition and, as such, should be permitted to continue filing administrative patent challenges.
 
This article appears in the December 2016 Issue: Volume 91, Number 6