Scott Lassman: Industry Takeaways from Allergan's Patent Transfer

Scott Lassman, JD, partner in Goodwin's Technology and Life Sciences Group, responds to Allergan's recent transfer of patents to a soverign entity, and gives 2 takeaways for industry.


What can the industry learn from the response to Allergan’s recent transfer of patents to a sovereign entity?

I think they could learn 2 things. One, that folks will do just about anything to protect a blockbuster product. I’ve got to say that the lawyers who came up with that should get an award; I thought that was unbelievably creative. I guess the lesson is to expect anything.

The second thing folks can learn is that timing is everything. I thought the timing of this was awful. Drug pricing issues are swirling around, you’ve got Congress looking at it, you’ve got FDA looking at it, and to pull what I think can only be considered a stunt like this, it’s just awful timing for the industry. It might be good for the company that did it, but I think it plays very poorly with the regulators and policy makers.

It reminds me of something that happened probably 20 years ago in the Hatch-Waxman context where you had a similar atmosphere of criticism of the industry and criticism of some of the tactics that companies use to ward of generic competition, and just at that moment 1 big company got a new patent issued, and I think it was at 11:00 at night the day before generics were supposed to be approved, they submitted the patent to FDA and blocked generics for another 30 months. That set off a firestorm and actually prompted FTC to complain and FDA to change their regulations. Ultimately, it prompted Congress to step in and change the statute and address something like that.

I actually saw a lot of similarities between that situation and this situation, and I would not be surprised if you see some sort of legislative response to it.