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Allergan Patent Controversy Continues

Seeking protection from the patent challenges brought by generic drug makers, Allergan Plc made an unusual, and controversial, deal back in September that has continued to make waves in the patent world.

The global pharmaceutical company announced the transfer of patents related to its popular eye medication, Restasis, to the Saint Regis Mohawk Tribe, “a recognized sovereign tribal government” with “sovereign immunity from IPR challenges,” according to the company’s press release.

Under the conditions of the new deal, Allergan would transfer its patents related to the chronic dry eye medication to the Native American tribe, which would then grant Allergan an exclusive license on the patents for a sum of $13.75 million.   The deal also specified that the Tribe would be eligible to receive as much as $15 million in ongoing royalties. Allergan would benefit by avoiding any legal challenges brought before the Patent Trial and Appeal Board, which would no longer have jurisdiction over the patents due to the Tribe’s sovereign status.

Not only would Allergan’s deal mean that the patents are no longer subject to review by the Patent Trial and Appeal Board, but it could also potentially limit generic manufacturers’ abilities to challenge the company in federal court.  At least, that was the idea.

Not long after the deal was announced, a federal judge in Texas invalidated the patents, bringing into question the validity of Allergan’s deal.  Since then, a number of U.S. senators have requested that Allergan disclose the full terms of its deal with the Saint Regis Mohawk Tribe, providing all supporting documentation including, “any legal briefs or memos.”  The reason, it seems, is that it’s possible that other big-name pharmaceutical companies will follow Allergen’s lead, continuing to hold a controversial monopoly on the drug market.

What are your thoughts on the topic?  Share with us in the comments.