Allergan Plc has to defend its intellectual property on multiple fronts of one of its blockbuster: Restasis a treatment for chronic dry eye, that brought in $1.49 billion in sales last year.
And the drug giant has found an unsual and different way. It will transfer the drug’s rights to the Saint Regis Mohawk Tribe.
The upstate New York tribe as agreed will be entitled of $13.75 million upon execution of the agreement. Additionally, the Tribe will be eligible to receive $15 million in annual royalties.
By moving key patents to a sovereign Native American group, Allergan says it may be able to protect itself.
The agreement is based on the fact that the Tribe is a sovereign government entity and that it is shielded from civil legal challenges over patents.
Lately many top drumakers have seen sales slowing down and profits shrinking due to the loss of exclusivity their blockbuster drugs and on the topo of this attacks on drug patents have been made easier under the patent office’s recently created fast-track legal review process.
Allergan’s solution could, as stated by Bob Bailey, Allergan’s chief legal officer, create: “a playbook for other cases down the road both for us and for others,”
Success for Allergan’s deal with the Saint Regis Mohawk Tribe would open a whole host of questions for the patent-review process, which was set up under a 2011 law. Tech companies are the biggest users of the system, intended as a lower-cost way to resolve patent disputes.
Teva Pharmaceutical, one of the companies that has used the IPR process to try to invalidate the patents for Restastis called the agreement “a new and unusual way for a company to try to delay access to high quality and affordable generic alternatives.”
On its side, the Saint Regis Mohawk Tribal Council stated, “This is a viable and sound opportunity for the Saint Regis Mohawk Tribe to enter into the patent, technology and research sector as part of our overall economic diversification strategy. We realize that we cannot depend solely on casino revenues and, in order for us to be self-reliant, we must enter into diverse business sectors to address the chronically unmet needs of the Akwesasne community; such as housing, employment, education, healthcare, cultural and language preservation.”
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