Sec. 3. Unlawful compensation for delay
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The Federal Trade Commission Act ( 15 U.S.C. 44 et seq.) is amended by inserting after section 26 ( 15 U.S.C. 57c–2 ) the following: The Commission may initiate a proceeding to enforce the provisions of this section against the parties to any agreement resolving or settling, on a final or interim basis, a patent infringement claim, in connection with the sale of a drug product. Subject to subparagraph (B), in such a proceeding, an agreement shall be presumed to have anticompetitive effects and shall be a violation of this section if— an ANDA filer receives anything of value, including an exclusive license; and the ANDA filer agrees to limit or forego research, development, manufacturing, marketing, or sales of the ANDA product for any period of time.
Subparagraph
(A)shall not apply if the parties to such agreement demonstrate by clear and convincing evidence that— the value described in subparagraph (A)(i) is compensation solely for other goods or services that the ANDA filer has promised to provide; or the procompetitive benefits of the agreement outweigh the anticompetitive effects of the agreement. In determining whether the settling parties have met their burden under subsection (a)(2)(B), the fact finder shall not presume— that entry would not have occurred until the expiration of the relevant patent or statutory exclusivity; or that the agreement’s provision for entry of the ANDA product prior to the expiration of the relevant patent or statutory exclusivity means that the agreement is procompetitive. Nothing in this section shall prohibit a resolution or settlement of a patent infringement claim in which the consideration granted by the NDA holder to the ANDA filer as part of the resolution or settlement includes only one or more of the following: The right to market the ANDA product in the United States prior to the expiration of— any patent that is the basis for the patent infringement claim; or any patent right or other statutory exclusivity that would prevent the marketing of such drug. A payment for reasonable litigation expenses not to exceed $7,500,000. A covenant not to sue on any claim that the ANDA product infringes a United States patent. A violation of this section shall be treated as a violation of section 5. Any party that is subject to a final order of the Commission, issued in an administrative adjudicative proceeding under the authority of subsection (a)(1), may, within 30 days of the issuance of such order, petition for review of such order in— the United States Court of Appeals for the District of Columbia Circuit; the United States Court of Appeals for the circuit in which the ultimate parent entity, as defined in section 801.1(a)(3) of title 16, Code of Federal Regulations, or any successor thereto, of the NDA holder is incorporated as of the date that the NDA is filed with the Commissioner of Food and Drugs; or the United States Court of Appeals for the circuit in which the ultimate parent entity of the ANDA filer is incorporated as of the date that the ANDA is filed with the Commissioner of Food and Drugs. In a proceeding for judicial review of a final order of the Commission, the findings of the Commission as to the facts, if supported by evidence, shall be conclusive. Nothing in this section shall modify, impair, limit, or supersede the applicability of the antitrust laws as defined in subsection
(a)of the first section of the Clayton Act ( 15 U.S.C. 12(a) ), and of section 5 of this Act to the extent that section 5 applies to unfair methods of competition. Nothing in this section shall modify, impair, limit, or supersede the right of an ANDA filer to assert claims or counterclaims against any person, under the antitrust laws or other laws relating to unfair competition. Each party that violates or assists in the violation of this section shall forfeit and pay to the United States a civil penalty sufficient to deter violations of this section, but in no event greater than 3 times the value received by the party that is reasonably attributable to the violation of this section. If no such value has been received by the NDA holder, the penalty to the NDA holder shall be sufficient to deter violations, but in no event greater than 3 times the value given to the ANDA filer reasonably attributable to the violation of this section. Such penalty shall accrue to the United States and may be recovered in a civil action brought by the Commission, in its own name by any of its attorneys designated by it for such purpose, in a district court of the United States against any party that violates this section. In such actions, the United States district courts are empowered to grant mandatory injunctions and such other and further equitable relief as they deem appropriate. If the Commission has issued a cease and desist order with respect to a party in an administrative adjudicative proceeding under the authority of subsection (a)(1), an action brought pursuant to paragraph
(1)may be commenced against such party at any time before the expiration of 1 year after such order becomes final pursuant to section 5(g). In an action under subparagraph (A), the findings of the Commission as to the material facts in the administrative adjudicative proceeding with respect to the violation of this section by a party shall be conclusive unless— the terms of such cease and desist order expressly provide that the Commission’s findings shall not be conclusive; or the order became final by reason of section 5(g)(1), in which case such finding shall be conclusive if supported by evidence. In determining the amount of the civil penalty described in this section, the court shall take into account— the nature, circumstances, extent, and gravity of the violation; with respect to the violator, the degree of culpability, any history of violations, the ability to pay, any effect on the ability to continue doing business, profits earned by the NDA holder, compensation received by the ANDA filer, and the amount of commerce affected; and other matters that justice requires. Remedies provided in this subsection are in addition to, and not in lieu of, any other remedy provided by Federal law. Nothing in this paragraph shall be construed to affect any authority of the Commission under any other provision of law. In this section: The term agreement means anything that would constitute an agreement under section 1 of the Sherman Act ( 15 U.S.C. 1 ) or section 5 of this Act. The term agreement resolving or settling a patent infringement claim includes any agreement that is entered into within 30 days of the resolution or the settlement of the claim, or any other agreement that is contingent upon, provides a contingent condition for, or is otherwise related to the resolution or settlement of the claim. The term ANDA means an abbreviated new drug application filed under section 505(j) of the Federal Food, Drug, and Cosmetic Act ( 21 U.S.C. 355(j) ) or a new drug application filed under section 505(b)(2) of the Federal Food, Drug, and Cosmetic Act ( 21 U.S.C. 355(b)(2) ). The term ANDA filer means a party that owns or controls an ANDA filed with the Commission of Food and Drugs or has the exclusive rights under such ANDA to distribute the ANDA product. The term ANDA product means the product to be manufactured under the ANDA that is the subject of the patent infringement claim. The term drug product has the meaning given such term in section 314.3(b) of title 21, Code of Federal Regulations (or any successor regulation). The term NDA means a new drug application filed under section 505(b) of the Federal Food, Drug, and Cosmetic Act ( 21 U.S.C. 355(b) ). The term NDA holder means— the holder of an approved NDA application for a drug product; a person owning or controlling enforcement of the patent listed in the Approved Drug Products With Therapeutic Equivalence Evaluations (commonly known as the FDA Orange Book ) in connection with the NDA; or the predecessors, subsidiaries, divisions, groups, and affiliates controlled by, controlling, or under common control with any of the entities described in subparagraphs
(A)and
(B)(such control to be presumed by direct or indirect share ownership of 50 percent or greater), as well as the licensees, licensors, successors, and assigns of each of the entities. The term party means any person, partnership, corporation, or other legal entity. The term patent infringement means infringement of any patent or of any filed patent application, extension, reissue, renewal, division, continuation, continuation in part, reexamination, patent term restoration, patents of addition, and extensions thereof. The term patent infringement claim means any allegation made to an ANDA filer, whether or not included in a complaint filed with a court of law, that its ANDA or ANDA product may infringe any patent held by, or exclusively licensed to, the NDA holder of the drug product. The term statutory exclusivity means those prohibitions on the approval of drug applications under clauses
(ii)through
(iv)of section 505(c)(3)(E) (5- and 3-year data exclusivity), section 527 (orphan drug exclusivity), or section 505A (pediatric exclusivity) of the Federal Food, Drug, and Cosmetic Act ( 21 U.S.C. 355(c)(3)(E) , 360cc, 355a). . Section 27 of the Federal Trade Commission Act, as added by this section, shall apply to all agreements described in section 27(a)(1) of that Act entered into after June 17, 2013. Section 27(f) of the Federal Trade Commission Act, as added by this section, shall apply to agreements entered into on or after the date of enactment of this Act.
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- 15 USC 57c–2
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