October 06, 2017
2 min read

Congress probes Allergan’s patent deal with Native American tribe

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Allergan’s patent-protection deal with the Saint Regis Mohawk Tribe is under scrutiny from Congress, as the legislative body begins research into the agreement.

Allergan recently transferred its patents for Restasis (cyclosporine ophthalmic emulsion 0.05%) to the New-York based Native American tribe, which has sovereign immunity. Allergan will maintain exclusive licenses to the patents while paying the Saint Regis tribe $15 million annually.

A letter from members of the House Committee on Oversight and Government Reform to Brent Saunders, Allergan chairman, president and CEO, requests all documents and communication between Allergan and the tribe regarding the Restasis patents, all analyses conducted before the agreement and any documents related to considerations of similar deals for other products. The deadline for the requested documents is Oct. 17.

“The implications of Allergan’s patent transfer raise questions for Congress as the exchange may impair competition across the pharmaceutical industry and ultimately dissuade companies from pursuing less-costly generic alternatives to brand drugs,” the legislators wrote in the letter.

The patent for Restasis’ active ingredient was set to expire in 2014, when Allergan filed additional patents extending protections to 2024, and the drug brought in $1.5 billion in revenues for Allergan in 2016, the letter reads.

“The sovereign status of Native American tribes adds time and complexity to contesting the status of the patents in question, because tribes may be immune from the legal claims generic drug makers use to challenge patents and bring less costly drugs to market more quickly,” the committee wrote.

In addition, on Oct. 5, Democratic Sen. Clare McCaskill of Missouri introduced legislation to abrogate the sovereign immunity of Indian tribes as a defense against inter partes review of patents. 

Previously, in a letter dated Oct. 2, McCaskill wrote to the Pharmaceutical Research and Manufacturers of America asking the trade group to look into Allergan’s dealings with the Saint Regis Tribe to determine if the action was “consistent with the mission” of the organization.

“I ask that PhRMA review whether actions to block patent challenges through claims of tribal sovereign immunity align with PhRMA efforts to promote innovation and discourage predatory pricing practices and anticompetitive conduct,” she wrote.

Allergan contends that the deal with the Saint Regis Mohawk Tribe does not shield Restasis patents from being litigated in federal courts and that the inter partes review process of pharmaceutical patents is the real issue, Mark Marmur, Allergan director of corporate affairs, said in a statement.

“The focus should be on the IPR process and its negative impact on life science innovation,” Marmur said. – by Rebecca L. Forand

Source: https://oversight.house.gov/letter/




Editor's note: This article has been updated to include a response from Allergan and information regarding Sen. McCaskill's legislation.