FTC warns pharma companies about sham patent listings designed to delay generics(techdirt.com)
techdirt.com
FTC warns pharma companies about sham patent listings designed to delay generics
https://www.techdirt.com/2023/09/18/ftc-warns-pharma-companies-that-it-may-go-after-them-for-sham-patent-listings-designed-to-delay-generic-competitors/
100 comments
Not only bogus, but if you get a hit on a scaffold you can combinatorially modify that scaffold and file it with the patent. This effectively blocks the small permutation space around the drug from further investigation or development.
There's lot of promising science that can't be done because incumbents are so adversarial about patent space for structures they don't even care about. To make matters worse, patent data and notation is:
* Poorly structured and defined,
* Difficult to parse,
* Uses combinatorial/wildcard notation (Markush structures [0], which is what modern drug patent law is based on).
So it's a total mess. The best analogy I could give for software is: imagine if you could patent closed source code (the literal code) and also attach a wildcard to every branch in logic within that closed source code, but all you publish are the filenames (as screenshots of directories, not text). You don't have to run due diligence that the permutations are run to spec or even compile, but now nobody can write logic infringing on your hypothetical code (which you never wrote).
If your reaction is 'what the fuck?', yes I agree.
[0] https://en.wikipedia.org/wiki/Markush_structure
There's lot of promising science that can't be done because incumbents are so adversarial about patent space for structures they don't even care about. To make matters worse, patent data and notation is:
* Poorly structured and defined,
* Difficult to parse,
* Uses combinatorial/wildcard notation (Markush structures [0], which is what modern drug patent law is based on).
So it's a total mess. The best analogy I could give for software is: imagine if you could patent closed source code (the literal code) and also attach a wildcard to every branch in logic within that closed source code, but all you publish are the filenames (as screenshots of directories, not text). You don't have to run due diligence that the permutations are run to spec or even compile, but now nobody can write logic infringing on your hypothetical code (which you never wrote).
If your reaction is 'what the fuck?', yes I agree.
[0] https://en.wikipedia.org/wiki/Markush_structure
Even ignoring the fact that they block a whole permutation space around the drug, this sounds completely nuts to me:
> The company which applies for a patent makes a general claim for the usage of the molecule without revealing to their competitors the exact molecule for which they are declaring a useful application
Isn't that against the very point of a patent? That you reveal (make "patent") what you're doing to the public so that the art isn't lost, in exchange for some form of commercial protection? How in the world is this legal?
> The company which applies for a patent makes a general claim for the usage of the molecule without revealing to their competitors the exact molecule for which they are declaring a useful application
Isn't that against the very point of a patent? That you reveal (make "patent") what you're doing to the public so that the art isn't lost, in exchange for some form of commercial protection? How in the world is this legal?
Thanks, let's leave out software. Not that it's not relevant, but it's a black hole for this crowd. One should not try to understand everything by analogy with software.
[deleted]
Cars, then?
No analogies. It is what it is.
Markush groups, as GP mentioned, are there specifically for chemical patents. So that's what's shaped the patent law, not software or cars.
Markush groups, as GP mentioned, are there specifically for chemical patents. So that's what's shaped the patent law, not software or cars.
It's purposefully a kind of algebraic notation. Algebra is math, particularly a kind of math that maps really well to software (less so, cars). Hence the analogy makes sense.
"Everything can be mapped to software"
Perhaps, but chemistry is chemistry. It existed before software did, and you need to understand it on its own terms.
Perhaps, but chemistry is chemistry. It existed before software did, and you need to understand it on its own terms.
Well yes, and. It's apples and oranges.
And FWIW, chemistry is only a little bit older than software. Like most other fields - there was a qualitative jump in the last ~100 years; arguably we didn't know shit about anything before the 20th century, before the theoretical and practical tools converged to allow some kind of formalized, precise knowledge and experimental work.
And FWIW, chemistry is only a little bit older than software. Like most other fields - there was a qualitative jump in the last ~100 years; arguably we didn't know shit about anything before the 20th century, before the theoretical and practical tools converged to allow some kind of formalized, precise knowledge and experimental work.
Analogies are not necessary all the time.
Indeed. My intent with my comment was to jokingly nod in that direction.
It's not bizarre at all.
Early hits are step 0.1 in bringing a drug to market. You patent a large space that gives you room to optimize the structure in terms of safety, efficacy, Pk, metabolites, etc.
Very rarely would you ever get 1 hit in a huge combinatorial screen. You'd likely get a few dozen. But you have no idea which ones would the best.
The company will usually nominate 5 or 6 hits (across the scaffold space) for further screening, then slowly whittle it down from there. By the time it hits humans, it's like 1 with 1 or 2 backups.
So you patent them all.
If you could only patent one, one of two things would happen: 1) the company would just file thousands of individual patents to accomplish the same thing or 2) not both developing the drug further unless they were 100% certain it was the right one (which I've never seen).
Early hits are step 0.1 in bringing a drug to market. You patent a large space that gives you room to optimize the structure in terms of safety, efficacy, Pk, metabolites, etc.
Very rarely would you ever get 1 hit in a huge combinatorial screen. You'd likely get a few dozen. But you have no idea which ones would the best.
The company will usually nominate 5 or 6 hits (across the scaffold space) for further screening, then slowly whittle it down from there. By the time it hits humans, it's like 1 with 1 or 2 backups.
So you patent them all.
If you could only patent one, one of two things would happen: 1) the company would just file thousands of individual patents to accomplish the same thing or 2) not both developing the drug further unless they were 100% certain it was the right one (which I've never seen).
Sure, you can argue that coverage for lead optimization is an unintentional feature, not a bug of Markush. But you have to admit that the current system is leveraged in bad faith i.e. for hedging against generics, staggering patents to maximize exclusivity period, exceptional vagueness and overreach in the structure definitions.
Technology and legal practices have far outpaced the USPTO. We have accidentally incentivized sheer volume and intentionally poor record-keeping as a moat. This is a fundamental _inefficiency_, because it de-emphasizes property based engineering and pushes ADMET down the road. Why do so many candidates fail for ADMET reasons a few years down the line? Because people aren't thinking about the risks sooner! Why not? Because surely the patent will cover everything.
Add to everything how siloed big pharma is and it becomes impossible to coordinate across the pipeline. IANAL, but certainly there must be some middle ground here -- the last time the USPTO took a stab at redefining this mess was 2007, but they failed.
https://www.uspto.gov/sites/default/files/web/offices/com/so...
They more or less proposed what you said: file a claim for each different invention, putting the onus of proof on the filer. In the amendment, Markush is appropriate if you have evidence backing that the chemical space has a true shared utility via structure i.e. test it or forget it OR the chemical space is 'obvious'.
When you read the original intent of the Markush decision i.e. "members of [a] Markush group are alternatively usable for the purposes of the invention," it becomes clear that we have strayed waaay from this definition. A Markush can easily contain structures that are impossible to synthesize at all!
Technology and legal practices have far outpaced the USPTO. We have accidentally incentivized sheer volume and intentionally poor record-keeping as a moat. This is a fundamental _inefficiency_, because it de-emphasizes property based engineering and pushes ADMET down the road. Why do so many candidates fail for ADMET reasons a few years down the line? Because people aren't thinking about the risks sooner! Why not? Because surely the patent will cover everything.
Add to everything how siloed big pharma is and it becomes impossible to coordinate across the pipeline. IANAL, but certainly there must be some middle ground here -- the last time the USPTO took a stab at redefining this mess was 2007, but they failed.
https://www.uspto.gov/sites/default/files/web/offices/com/so...
They more or less proposed what you said: file a claim for each different invention, putting the onus of proof on the filer. In the amendment, Markush is appropriate if you have evidence backing that the chemical space has a true shared utility via structure i.e. test it or forget it OR the chemical space is 'obvious'.
When you read the original intent of the Markush decision i.e. "members of [a] Markush group are alternatively usable for the purposes of the invention," it becomes clear that we have strayed waaay from this definition. A Markush can easily contain structures that are impossible to synthesize at all!
I mean, if the argument is PTO should be better resources so that patents can undergo more rigorous evaluation, you won't get an argument from me.
You're not supposed to patent anything you haven't actually made, however, there is no validation of that and as a result patent applicants are incentivized to patent as broad a space as possible.
However, if we did move to a "single molecule, single patent" approach, the workload on the PTO would skyrocket. For pharmaceutical companies the cost of a patent and its preparation is infinitesimal compared to the cost of developing a drug - pharma companies wouldn't bat an eye at submitting 1000's of patents for each discovery program.
But, as I stated above, I don't disagree the process could be made better.
You're not supposed to patent anything you haven't actually made, however, there is no validation of that and as a result patent applicants are incentivized to patent as broad a space as possible.
However, if we did move to a "single molecule, single patent" approach, the workload on the PTO would skyrocket. For pharmaceutical companies the cost of a patent and its preparation is infinitesimal compared to the cost of developing a drug - pharma companies wouldn't bat an eye at submitting 1000's of patents for each discovery program.
But, as I stated above, I don't disagree the process could be made better.
> You're not supposed to patent anything you haven't actually made
not true. That's Actual Reduction to Practice. There is also Constructive Reduction to Practice.
I wrote about this in depth, for software:
https://albertcory50.substack.com/p/no-source-code-no-patent
This is a good place to repeat, "let's just remove software from the patent system."
If you don't, then any changes you propose will being the Big Pharma lobby down on you. Once we get our own IP protection laws (or no IP laws), the pharma companies won't care about us anymore.
not true. That's Actual Reduction to Practice. There is also Constructive Reduction to Practice.
I wrote about this in depth, for software:
https://albertcory50.substack.com/p/no-source-code-no-patent
This is a good place to repeat, "let's just remove software from the patent system."
If you don't, then any changes you propose will being the Big Pharma lobby down on you. Once we get our own IP protection laws (or no IP laws), the pharma companies won't care about us anymore.
There is an easy solution, you already can't patent cooking recipes. So why allow chemical recipes? To those that say that would stifle innovation, well historic evidence is inconclusive at best, e.g. the development of the pharmaceutical industries in the US, Germany and Switzerland saw thr biggest industry develop in Switzerland who did not have any patent protection followed by Germany, where only processes not chemicals could be patented. The US pharmaceutical industry only become much bigger after they benefited from the harmonisation of patent systems to follow the strong protection in the US.
“Recipes” aren’t the key patents in pharma, it’s new molecules - new composition of matter. Occasionally processes are patented but competitors could still make the molecule other ways.
And considering the pharma industry never really took off until the mid-century I’m not sure your claim of “saw the biggest industry develop” before the parents we have today holds any weight.
And considering the pharma industry never really took off until the mid-century I’m not sure your claim of “saw the biggest industry develop” before the parents we have today holds any weight.
The Pharma lobby is one of the most powerful in DC. Zero chance of that ever happening.
So let's remove software from the list of patentable subject matter. Then Pharma won't care about us anymore. One thing at a time.
So let's remove software from the list of patentable subject matter. Then Pharma won't care about us anymore. One thing at a time.
> not both[er] developing the drug further unless they were 100% certain it was the right one (which I've never seen)
I don’t really understand this argument. Patent law is just another moat. If it doesn’t exist for all competitors, it’s just different baseline for calculations. The market is still big and attractive, so all those who give up will open space for those who figured out how to survive without patents. Likely this will lead to a bigger concentration of capital, because in the absence of patent protections you may need to spend more on security. But it is happening anyway for other reasons, so we have to deal with monopolies anyway.
I don’t really understand this argument. Patent law is just another moat. If it doesn’t exist for all competitors, it’s just different baseline for calculations. The market is still big and attractive, so all those who give up will open space for those who figured out how to survive without patents. Likely this will lead to a bigger concentration of capital, because in the absence of patent protections you may need to spend more on security. But it is happening anyway for other reasons, so we have to deal with monopolies anyway.
Please explain how, without patents, a company would choose to invest hundreds of millions of dollars to discovery a new molecule and get it approved, when another company could start selling it as well without any of the investment at all?
Financially it makes zero sense.
And if the logic is - well the government can fund the research (which is a huge stretch since Pharma R&D is several multiple of gov't funding today), ok, but then you end up paying for the medicine through taxes instead.
Financially it makes zero sense.
And if the logic is - well the government can fund the research (which is a huge stretch since Pharma R&D is several multiple of gov't funding today), ok, but then you end up paying for the medicine through taxes instead.
>Please explain how, without patents, a company would choose to invest hundreds of millions of dollars to discovery a new molecule and get it approved, when another company could start selling it as well without any of the investment at all?
>Financially it makes zero sense.
Innovations in funding, protection of secrets etc do happen time to time, so even if I cannot give you satisfying answer now, it does not mean such answer does not exist. It took thousands of years to invent modern corporation and stock exchange. Cryptocurrencies are recent invention. Imagine some sort of pooled research, where all competitors/partners agree to compete only after the discovery, i.e. in production efficiency and costs, marketing etc, with some . Imagine some clever chemical engineering, where a pill is such a mixture of acting substance and harmless components that reverse engineering is too hard to complete without comparable budget. Maybe it will be something completely different that we will find obvious only after it is discovered.
>Financially it makes zero sense.
Innovations in funding, protection of secrets etc do happen time to time, so even if I cannot give you satisfying answer now, it does not mean such answer does not exist. It took thousands of years to invent modern corporation and stock exchange. Cryptocurrencies are recent invention. Imagine some sort of pooled research, where all competitors/partners agree to compete only after the discovery, i.e. in production efficiency and costs, marketing etc, with some . Imagine some clever chemical engineering, where a pill is such a mixture of acting substance and harmless components that reverse engineering is too hard to complete without comparable budget. Maybe it will be something completely different that we will find obvious only after it is discovered.
[deleted]
If I understand things correctly (not assured by any means, as I've only skimmed some of the sources), the abuse vector looks something like this:
1) A company files that trivial "improvement" patent, or simply picks a recent patent out of its portfolio whose applicability to the drug is unclear. Hilariously, in the linked example from the article, the "improvement" was merely to claim that a metabolite was the active molecule rather than the drug per se, and thus change the instructions for when to take the pill relative to mealtimes.
2) The company files for an Orange Book listing asserting that the new patent applies to the old drug.
3) A generic manufacturer seeking approval disputes this assertion in its ANDA (abbreviated new drug application) filing.
4) The FDA provisionally approves the generic.
5) The generic manufacturer starts tooling up for manufacturing and taking orders for the product.
6) The brand-name manufacturer sues the generic manufacturer, which automatically triggers a 30-month stay on the approval.
1) A company files that trivial "improvement" patent, or simply picks a recent patent out of its portfolio whose applicability to the drug is unclear. Hilariously, in the linked example from the article, the "improvement" was merely to claim that a metabolite was the active molecule rather than the drug per se, and thus change the instructions for when to take the pill relative to mealtimes.
2) The company files for an Orange Book listing asserting that the new patent applies to the old drug.
3) A generic manufacturer seeking approval disputes this assertion in its ANDA (abbreviated new drug application) filing.
4) The FDA provisionally approves the generic.
5) The generic manufacturer starts tooling up for manufacturing and taking orders for the product.
6) The brand-name manufacturer sues the generic manufacturer, which automatically triggers a 30-month stay on the approval.
I believe the word you are looking for is fraudulent. And yea, why aren't we prosecuting for that.
I've been taking the "blockbuster drug", Humira/Adalimumab, for more than 10 years. Humira alone is estimated to have generated US$200 billion in profits for a single company. Its history, its legal and commercial maneuvers are appalling and possibly the poster child for what is wrong with the patent system. And how public money originally funds much of the research into these drugs.
This year I finally started taking a biosimilar. Still extremely expensive. I don't have to pay for it, I sued the government to get it, here in Brazil. Unfortunately, this is not an uncommon situation. Our constitution guarantees our right to health and the government's obligation to provide it.
https://www.npr.org/sections/health-shots/2023/07/20/1188745...
https://en.wikipedia.org/wiki/Adalimumab#Patent_litigation
This year I finally started taking a biosimilar. Still extremely expensive. I don't have to pay for it, I sued the government to get it, here in Brazil. Unfortunately, this is not an uncommon situation. Our constitution guarantees our right to health and the government's obligation to provide it.
https://www.npr.org/sections/health-shots/2023/07/20/1188745...
https://en.wikipedia.org/wiki/Adalimumab#Patent_litigation
AlbertCory(2)
I have been taking Humira for close to 7 years now. What disgusted me was not just the antics of AbbVie in patent protecting Humira, but how my brother (who works at AbbVie) began justifying their acrimonious practices.
Although, thankfully now there are a bunch of biosimilars coming onto the market, so we can expect to see further price decreases. For a manufacturing project, we contracted out a study recently on the market sizes (in USD) for a number of biosimilars under development. Humira is the only one that's predicted to have a market size reduction (by 40%!) because of how much AbbVie has been milking it.
Although, thankfully now there are a bunch of biosimilars coming onto the market, so we can expect to see further price decreases. For a manufacturing project, we contracted out a study recently on the market sizes (in USD) for a number of biosimilars under development. Humira is the only one that's predicted to have a market size reduction (by 40%!) because of how much AbbVie has been milking it.
As someone that worked in biotech/pharma for a decade, they LOVE to roll out the sick-people porn and talk about how we’re all making the world a better place…it helps them pay people less.
They can occasionally do some good things, but the large companies are no more ethical than Comcast. The small companies vary, but often have little real goals other than making the C-suite a few extra million no matter what.
The last small pharma I left discontinued all of their RNA sequencing experiments because they were worried about the data existing and it causing issues with FDA clearance down-the-line. Basically, don’t study it because it could show bad side-effects…but all of these PhD’s are making the world a better place, good job! Make sure to get married so you can afford a crappy townhome.
Gross.
They can occasionally do some good things, but the large companies are no more ethical than Comcast. The small companies vary, but often have little real goals other than making the C-suite a few extra million no matter what.
The last small pharma I left discontinued all of their RNA sequencing experiments because they were worried about the data existing and it causing issues with FDA clearance down-the-line. Basically, don’t study it because it could show bad side-effects…but all of these PhD’s are making the world a better place, good job! Make sure to get married so you can afford a crappy townhome.
Gross.
>What disgusted me was not just the antics of AbbVie in patent protecting Humira, but how my brother (who works at AbbVie) began justifying their acrimonious practices.
"It is difficult to get a man to understand something when his salary depends upon his not understanding it."
- Upton Sinclair
"It is difficult to get a man to understand something when his salary depends upon his not understanding it."
- Upton Sinclair
These people won't stop lobbying to have this kind of exclusivity respected in other jurisdictions as well. Whether through the US government or directly, they've constantly pressured us here in Australia to "respect" the same privileges they enjoy in the US. Thank God we have largely resisted these efforts so far. Generics here are highly available for almost anything at the consumer level. Those who can afford to often buy name brand anyway, because of psychological reasons I guess, so pharmaeceutical companies still make stacks of cash, without poor people jeeding to spend half their weekly income on basic meds.
I understand and appreciate that the US government doesn't arbitrarily begin semi-retributive campaigns, and instead attempts to have companies self-correct. But in instances like this of obvious, wilful abuse of the law, there should be some drawing of blood frankly. It strikes me as a little pathetic that these agencies are always issuing "warnings" that they might actually start enforcing regulations. It's exactly this that makes these companies feel they have license to behave this way, because they know they'll have plenty of time to clean up if the laws actually start getting enforced, and they'll have made a tidy profit at everybody else's expense in the meantime.
I understand and appreciate that the US government doesn't arbitrarily begin semi-retributive campaigns, and instead attempts to have companies self-correct. But in instances like this of obvious, wilful abuse of the law, there should be some drawing of blood frankly. It strikes me as a little pathetic that these agencies are always issuing "warnings" that they might actually start enforcing regulations. It's exactly this that makes these companies feel they have license to behave this way, because they know they'll have plenty of time to clean up if the laws actually start getting enforced, and they'll have made a tidy profit at everybody else's expense in the meantime.
At first I thought this was about minor changes to formulations that can be granted new patents, a problem which seems to me to be to be outside the FTC's purview. It looks like the problem is more like out and out fraud:
Brand drug manufacturers are responsible for ensuring their patents are properly listed. Yet certain manufacturers have submitted patents for listing in the Orange Book that claim neither the reference listed drug nor a method of using it.
. . . courts have recognized that improperly listing patents in the Orange Book may constitute an “improper means” of competition. Accordingly, improperly listing patents in the Orange Book may also be worthy of enforcement scrutiny from government and private enforcers under a monopolization theory.
Brand drug manufacturers are responsible for ensuring their patents are properly listed. Yet certain manufacturers have submitted patents for listing in the Orange Book that claim neither the reference listed drug nor a method of using it.
. . . courts have recognized that improperly listing patents in the Orange Book may constitute an “improper means” of competition. Accordingly, improperly listing patents in the Orange Book may also be worthy of enforcement scrutiny from government and private enforcers under a monopolization theory.
My take: she has a solid case on this. You build credibility by winning. She hasn't done a good job on that.
The FTC’s statement cites a Shkreli case. I wouldn’t get my hopes up.
It is quite clearly fraud. For some reason we don't seem to prosecute companies for fraud.
Maybe they can add a third clause to be “safe, effective, and accessible”?
The history of the FDA is pretty interesting and disappointing to say the least. Especially with the supplement craze.
The history of the FDA is pretty interesting and disappointing to say the least. Especially with the supplement craze.
I don't know how the US public can take any of the federal regulatory agencies seriously, given their history of corruption[1]. We only hear about cases that happen to leak, but who knows how many go undiscovered. It's easy to be conspiratorial about this and assume that the corruption happens at the highest levels of government.
[1]: https://www.businessinsider.com/fda-chief-approved-oxycontin...
[1]: https://www.businessinsider.com/fda-chief-approved-oxycontin...
Paul Offit writes about the FDA history in his book "Do you believe in Magic?". His argument is that the FDA tends to try to do what is "right" but the public opinion gets swayed to the point where it becomes political and we "do this to ourselves".
So one government agency - the USPTO - grants temporary monopolies to inventors as patents. Then another government agency - the FDA - restricts the drugs people can take to those specifically prescribed by a doctor, and then restricts pharmacies to making a very limited set of substitutions as "generics".
Now since that system is messed up, we're involving yet a third agency, the FTC, to complain about companies using the letter of the law to avoid advertising the existence of competitor's products. Instead why dont we jist fix the broken USPTO and FDA systems? Shorten drug patents from 20 years to 10 or so? Stop allowing patents for trivial changes. Allow pharmacies to suggest generic substitutions. Etc. Pulling in a third government agency into the mix to fix the failures of the first two seems like the wrong approach.
Now since that system is messed up, we're involving yet a third agency, the FTC, to complain about companies using the letter of the law to avoid advertising the existence of competitor's products. Instead why dont we jist fix the broken USPTO and FDA systems? Shorten drug patents from 20 years to 10 or so? Stop allowing patents for trivial changes. Allow pharmacies to suggest generic substitutions. Etc. Pulling in a third government agency into the mix to fix the failures of the first two seems like the wrong approach.
If they were serious then they would put the CEOs in jail.
The point of a CEO is as a fall guy. Only going after the CEO means nothing is solved, the hydra remains. Instead you have to decapitate the company’s leading structure, such as investors and high management, then hope for a systemic change which may or may not come.
I agree, seize the company and take ownership of all its assets, including IP, at a minimum. Fines and punishments with no teeth are not any good for the public interest.
But what about the harm that does to the shareholders?
I wish I were being facetious, but while a lot of scummy people and companies own shares, a lot more just move cash in various forms out of the company into independent entities. If the company has all its assets seized by some mechanism, presumably all the large shareholders: pension funds, 401ks, etc are subject to even more penalties and there are no assets or even potential future income to compensate them. Essentially you get the Great Recession or Enron effect where large numbers of retired or near retirement people suddenly no longer had pensions or retirement savings.
Your only real option is to charge all the individuals involved and send them to jail, and fines for everyone and everything else - though the fines for the company have to be more than the potential profit by a large amount.
Otherwise you run into a problem where say one person working for the company wants a bonus and realizes a fraudulent listing would get him that bonus? In your model that one person functionally bankrupts the company vs fining and jailing that person and fining the corporation for failing to ensure adequate controls on entries to the orange book.
I wish I were being facetious, but while a lot of scummy people and companies own shares, a lot more just move cash in various forms out of the company into independent entities. If the company has all its assets seized by some mechanism, presumably all the large shareholders: pension funds, 401ks, etc are subject to even more penalties and there are no assets or even potential future income to compensate them. Essentially you get the Great Recession or Enron effect where large numbers of retired or near retirement people suddenly no longer had pensions or retirement savings.
Your only real option is to charge all the individuals involved and send them to jail, and fines for everyone and everything else - though the fines for the company have to be more than the potential profit by a large amount.
Otherwise you run into a problem where say one person working for the company wants a bonus and realizes a fraudulent listing would get him that bonus? In your model that one person functionally bankrupts the company vs fining and jailing that person and fining the corporation for failing to ensure adequate controls on entries to the orange book.
You have to break some eggs to make omelettes. How many families have been broken up and sent into poverty because a white collar criminal was thrown in jail and their assets seized? Obviously I wish side effects didn't happen, but unless there are consequences it will continue to happen with impunity.
It is easier than that.
Issue nine shares of stock for every one outstanding, and split it evenly between victims (if applicable) and a new public offering.
Make sure the victims have 90% control of the company after that, by giving them multiple non-transferrable votes per share. Also, make sure they are organized enough to vote as a block (to replace board members, etc).
Issue nine shares of stock for every one outstanding, and split it evenly between victims (if applicable) and a new public offering.
Make sure the victims have 90% control of the company after that, by giving them multiple non-transferrable votes per share. Also, make sure they are organized enough to vote as a block (to replace board members, etc).
Let's go proactive.
In exchange for the legal conveniences that being a limited-liability/stock company offers, you must issue to the state a class of shares that are nontradeable/zero-dividend (and thus do not dilute valuation) but voting, representing 49% of the voting power.
A well-behaved company would see little difference there; the state-owned shares would typically abstain or vote with management. But if they get too brazen and abusive, the board is gonna have to figure out how to handle what is effectively the ultimate hostile investor: "line goes up" means nothing to them, but "the public's pissed they still can't afford their meds" does.
In exchange for the legal conveniences that being a limited-liability/stock company offers, you must issue to the state a class of shares that are nontradeable/zero-dividend (and thus do not dilute valuation) but voting, representing 49% of the voting power.
A well-behaved company would see little difference there; the state-owned shares would typically abstain or vote with management. But if they get too brazen and abusive, the board is gonna have to figure out how to handle what is effectively the ultimate hostile investor: "line goes up" means nothing to them, but "the public's pissed they still can't afford their meds" does.
Psssh fall guy. They just get their golden handshake, exit and then the next CEO (who knows or is connected to the previous one) comes in and does it all over again.
Just invalid their full current patent portfolio. Scary enough punishment to solve the issue.
Does this mean we can finally have the already-approved, over-17-year-old, and not-produced Lyme disease vaccine?
To do that for any drug, the FDA needs to approve the new factory setup at a minimum, and that would probably take at least 3 years in practice. Problem is, vaccines are biologicals and you don't get generics for biologicals so that's out from the start. You'd have to re-do at least part of the trials to get a biosimilar licensed.
I followed Lina Kahn (FTC chair) on Twitter before Biden appointed her, and I was kind of blown away that it happened. She had a very clear philosophical opposition to a lot of the way things are done in this country.
And I mean, I followed her because I agreed! But my preferences are not mainstream. Amazing to see her slinging rocks at giants from this position.
And I mean, I followed her because I agreed! But my preferences are not mainstream. Amazing to see her slinging rocks at giants from this position.
Khan's utter failure to execute on her goals has imo set back the anti-trust movement in this country heavily. Now every time anti trust gets brought up people think about how the government lost 5 cases in a row and consider it a waste.
I hear this bandied about so much, but I've never heard justification that the cases weren't well built or that they weren't good cases to bring.
The wicked thing about case law is that it builds and builds. The courts have been extremely pro big business for a long time, and it's hard to figure out how anything ever changes or gets better from here.
Trying to right this hell is going to take a lot of miserable attempts that go nowhere. That's what happens when the titans already have all the case law in their favor. Yes that means we need to be very well prepared when we go to battle - try to overturn their legalistic dominance - but I'm glad we are trying, and I'm not sure what better paths are available, not sure what the actual lessons are, not sure what should have been better. It feels like such a slim chance. And trying feels necessary, feels like it has a chance, even if odds aren't great.
Something has to be done to let us revisit the past, but that's not how the courts especially operate. The courts are the primary upkeeper of existing decisions, and this feels sometimes like ossification, sometimes feels like it eats away from the flesh of the nation.
The wicked thing about case law is that it builds and builds. The courts have been extremely pro big business for a long time, and it's hard to figure out how anything ever changes or gets better from here.
Trying to right this hell is going to take a lot of miserable attempts that go nowhere. That's what happens when the titans already have all the case law in their favor. Yes that means we need to be very well prepared when we go to battle - try to overturn their legalistic dominance - but I'm glad we are trying, and I'm not sure what better paths are available, not sure what the actual lessons are, not sure what should have been better. It feels like such a slim chance. And trying feels necessary, feels like it has a chance, even if odds aren't great.
Something has to be done to let us revisit the past, but that's not how the courts especially operate. The courts are the primary upkeeper of existing decisions, and this feels sometimes like ossification, sometimes feels like it eats away from the flesh of the nation.
It's also been a mere ~2 years since she was appointed.
cases that lose are not well built. No excuses. Losing a case further entrenches the precedent against you, there's no silver lining.
That's just not true.
If you're losing on Constitutional grounds, I agree with you. But if you're losing the case on legal grounds it can absolutely be a silver lining, since it can demonstrate to Congress a need to legislate (I know, I know, a foreign concept for Congress).
Consider Section 230, though. It was passed because the Supreme Court ruled on a case in a way that irritated Congress. The Courts were bound because the law was what it was. But those Court cases prompted Congress to act. The actual rulings from the Court were horrendous precedent, and if that's where the policymaking stopped the internet would have been a disaster. But Congress acted and passed Section 230.
If you're losing on Constitutional grounds, I agree with you. But if you're losing the case on legal grounds it can absolutely be a silver lining, since it can demonstrate to Congress a need to legislate (I know, I know, a foreign concept for Congress).
Consider Section 230, though. It was passed because the Supreme Court ruled on a case in a way that irritated Congress. The Courts were bound because the law was what it was. But those Court cases prompted Congress to act. The actual rulings from the Court were horrendous precedent, and if that's where the policymaking stopped the internet would have been a disaster. But Congress acted and passed Section 230.
>The actual rulings from the Court were horrendous precedent
Do you happen to remember that ruling? I'd be interested in reading it.
Do you happen to remember that ruling? I'd be interested in reading it.
The EFF has a pretty good page that outlines the cases: https://www.eff.org/issues/cda230/legislative-history
One was Cubby v. CompuServe [1], which found that an online platform was not liable as a "distributor" (which is basically an analogy to physical books, since most of the prior case-law was based on physical printed words), because they didn't review any content on the forums before it was posted.
The other was Stratton Oakmont v Prodigy [2] (which was actually a NY court case), which found that because Prodigy performed _any_ moderation, they were more akin to a publisher, which was liable for everything they published.
Taken together, the two rulings essentially meant that any site that hosted user generated content had two options:
- Perform *no moderation at all* (no deleting Nazis, pornography, spam, etc), OR
- Assume liability for *all* user generated content on the site
Also, a final note, I was actually wrong when I invoked the Supreme Court. It was a federal district court case, and a NY state court case.
[1] https://law.justia.com/cases/federal/district-courts/FSupp/7...
[2] https://en.wikipedia.org/wiki/Stratton_Oakmont,_Inc._v._Prod... (I'm actually not finding the full text of the opinion online after a brief bit of searching. I've found a couple of sites that have links to it, but all are broken at the moment; I'm sure you can find it with some more digging, but I don't have time to find it atm)
One was Cubby v. CompuServe [1], which found that an online platform was not liable as a "distributor" (which is basically an analogy to physical books, since most of the prior case-law was based on physical printed words), because they didn't review any content on the forums before it was posted.
The other was Stratton Oakmont v Prodigy [2] (which was actually a NY court case), which found that because Prodigy performed _any_ moderation, they were more akin to a publisher, which was liable for everything they published.
Taken together, the two rulings essentially meant that any site that hosted user generated content had two options:
- Perform *no moderation at all* (no deleting Nazis, pornography, spam, etc), OR
- Assume liability for *all* user generated content on the site
Also, a final note, I was actually wrong when I invoked the Supreme Court. It was a federal district court case, and a NY state court case.
[1] https://law.justia.com/cases/federal/district-courts/FSupp/7...
[2] https://en.wikipedia.org/wiki/Stratton_Oakmont,_Inc._v._Prod... (I'm actually not finding the full text of the opinion online after a brief bit of searching. I've found a couple of sites that have links to it, but all are broken at the moment; I'm sure you can find it with some more digging, but I don't have time to find it atm)
Stratton Oakmont was notably made semi super famous in their cocaine-fueled Hollywoodized Wolf of Wallstreet portrayal, making plain the pernicious S.O.B. financial worlds willingness to prey on everyone.
Oh and what a shock. The courts sided with Strston Oakmont saying that online providers were liable for allowing people to discuss the merciless piece of shit bastard scum as they actually were. Just absolute shit can monstrous vile shit going on in the courts, helping the worst corporations persecute humanity with impunity.
I watched the 2851 miles video recently, and honestly this whole pissing in the face of regulatory capture story seems 99% to be a problem with the useless pro-business courts, and the ability of these predator of humankind to court shop their pernicious horse-shit. The video is largely about the Telecommunications Act of 1996 failing to create competition, but it was the courts that told the FCC to give up the Congress mandate to create local loop unbundling & to give fiber & cable natural / physical monopoly. Again and again, good law is subverted in court by checks & balances which have only one representative: big money corporate interests.
Oh and what a shock. The courts sided with Strston Oakmont saying that online providers were liable for allowing people to discuss the merciless piece of shit bastard scum as they actually were. Just absolute shit can monstrous vile shit going on in the courts, helping the worst corporations persecute humanity with impunity.
I watched the 2851 miles video recently, and honestly this whole pissing in the face of regulatory capture story seems 99% to be a problem with the useless pro-business courts, and the ability of these predator of humankind to court shop their pernicious horse-shit. The video is largely about the Telecommunications Act of 1996 failing to create competition, but it was the courts that told the FCC to give up the Congress mandate to create local loop unbundling & to give fiber & cable natural / physical monopoly. Again and again, good law is subverted in court by checks & balances which have only one representative: big money corporate interests.
> Now every time anti trust gets brought up people think about how the government lost 5 cases in a row and consider it a waste.
It demonstrates how weak and toothless are current laws are, and shows a desperate need for Congressional action.
Before, when you brought up Congressional action on anti-trust it would get waived away with: "The FTC has the powers they need and aren't using them. There's no need for Congress to act".
If someone tried to raise those objections today, they looked silly.
The fact of the matter is the executive branch needed to walk into the buzz-saw to demonstrate that the current laws are insufficient and prompt Congress to act. Now it's a matter of putting public pressure on Congress to act.
It demonstrates how weak and toothless are current laws are, and shows a desperate need for Congressional action.
Before, when you brought up Congressional action on anti-trust it would get waived away with: "The FTC has the powers they need and aren't using them. There's no need for Congress to act".
If someone tried to raise those objections today, they looked silly.
The fact of the matter is the executive branch needed to walk into the buzz-saw to demonstrate that the current laws are insufficient and prompt Congress to act. Now it's a matter of putting public pressure on Congress to act.
More a warning of how stacked the rules are against anti-trust, after 20-30 years of profitable M&A and other anti-competitive behavior.
With the current stagnated Congress session possibly but now whenever better legislation comes up any attempts to claim existing rules are "good enough" is objectively wrong.
"objectively wrong" no longer exists in politics, if it ever did.
The government isn't capable of doing the work it wants to do and so "good enough" doesn't apply.
You can claim that the government was wrong in its pursuit of this case but that doesn't suddenly mean Congress has no work to do.
At minimum codifying what makes it inappropriate for the government to take the action it attempted would be valuable.
Congress is supposed to clarify if the Executive and Judicial do not agree on the meaning of their laws.
Thus "objectively wrong" isn't about which side is right, it is that agreement doesn't exist.
You could claim there was an unimportant misunderstanding after the first but after so many it is obvious there is a disconnect.
You can claim that the government was wrong in its pursuit of this case but that doesn't suddenly mean Congress has no work to do.
At minimum codifying what makes it inappropriate for the government to take the action it attempted would be valuable.
Congress is supposed to clarify if the Executive and Judicial do not agree on the meaning of their laws.
Thus "objectively wrong" isn't about which side is right, it is that agreement doesn't exist.
You could claim there was an unimportant misunderstanding after the first but after so many it is obvious there is a disconnect.
> The government isn't capable of doing the work it wants to do
Debatable. Unless you're just referring to the executive branch the government does not have a single goal, and many of the leaders of the government want opposite things.
> Thus "objectively wrong" isn't about which side is right, it is that agreement doesn't exist.
Sure we can agree there. The issue is that there isn't even agreement on whether there's agreement. Kneecapping the government is the meta optimal move for minority parties, they gain nothing from trying to make the government more effective. So even if all the lawmakers secretly agree that congress has work to do, they'll never admit it.
Debatable. Unless you're just referring to the executive branch the government does not have a single goal, and many of the leaders of the government want opposite things.
> Thus "objectively wrong" isn't about which side is right, it is that agreement doesn't exist.
Sure we can agree there. The issue is that there isn't even agreement on whether there's agreement. Kneecapping the government is the meta optimal move for minority parties, they gain nothing from trying to make the government more effective. So even if all the lawmakers secretly agree that congress has work to do, they'll never admit it.
You keep saying "someone might want to do a bad thing" as if it is an argument.
I never said they would do something, which is what you are arguing against. I said there isn't an excuse to not do anything based on the existing law covering what needs to be covered.
Mostly I point it out because the "X government won't do anything" is uninteresting to discuss, it is basically an impossible to defeat argument.
> Unless you're just referring to the executive branch the government
In this context the branch of the government whose job it is to take this action is taking an action and so I felt specifying Executive was needlessly specific.
It isn't like Congress is using this act to go after violators, that isn't their job.
I never said they would do something, which is what you are arguing against. I said there isn't an excuse to not do anything based on the existing law covering what needs to be covered.
Mostly I point it out because the "X government won't do anything" is uninteresting to discuss, it is basically an impossible to defeat argument.
> Unless you're just referring to the executive branch the government
In this context the branch of the government whose job it is to take this action is taking an action and so I felt specifying Executive was needlessly specific.
It isn't like Congress is using this act to go after violators, that isn't their job.
Biden's had a number of appointments that have been surprisingly on point. I really like how antitrust enforcement is finally, FINALLY getting some teeth.
Maybe it was her surname. This "hipster antitrust" approach is a nice smoke screen big pharma needs. India and other countries already make generics, there is no need to wait several years for US manufacturers. FTC is just a road block that prevents cheap medical imports.
Is it really though. Even with the current level of regulation we have more than enough scandals with, say, artificial tears that blinded people who used them.
FDA should be able to make sure imports are safe
It's all a trade off. We can have more affordable medicine by importing it. This means more people will be able to access it, meaning less bankruptcies, which isn't any good for one's health. Will it be less safe than the ones you can currently get for an exorbitant prices? Marginally, probably. Overall, society can benefit from letting people import their medicine. It will also drive down prices and force big pharma to drop their prices.
I don't think cheaper medicine that is likely poison is much of a bargain at all, but what do I know? IP law would seem to me to have more to do with the cost than the heavy hand of regulation.
> Maybe it was her surname.
Would you mind expanding on that?
Would you mind expanding on that?
Our regulators need to find some conviction.
Just do it already.
Just do it already.
Also if it’s patented it cannot be made generic, if expired it can. What’s the point of using the orange book?
Yeah, I wonder too. A patent should be registered with the patent office and everyone can search there to see if there is something and what it covers and when it expires. What's this orange book all about. Some easier to search database? Why can big pharma enter stuff themselves and why does the FTC not check this? Seems absurd. Can it be that the orange book is an invention by big pharma and their lobby?
I think they modify it a bit, parent that, put it in orange book, have insurance companies recommend this instead of the original, it could deter the generic makers because patients will be looking for the modified version say(extra long release).
Why not insert every drug so it don’t go generic? I’m not getting how this orange book works
Biosimilars couldn’t come sooner.
Why warn them? Just do it already.
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I like the sentiment - but this is probably the "just do it already". Real warnings happen behind closed doors - this is probably a "We're going to create a PR nightmare if you don't fix your act, this is the first step on the public being very very mad. And we'd rather like to avoid going to court against your super-lawyers."
Just revoke a corporate charter or two of the most frequent abusers. That will certainly get the attention of those that remain. Then you can warn them that they're next if they don't change tack pronto. Big companies are next to invulnerable when you treat them using the same playbook as you would a jaywalker or a person the runs a red light. They love their court cases because they have lawyers on retention and it helps them build an even stronger moat: the moat made up out of negligible legal costs at scale that would criple smaller players. So only large players remain. But revoking a corporation's charter instantly crushes that angle of defense and it is used far too sparingly.
After that the shareholders get to pick over the leftovers. It's the corporate equivalent of the death penalty and since these companies are responsible for the lives of those that depend on affordable medication this sort of money grab is a reason people have reduced quality of life or die. It's beyond disgusting and such abuses deserve the harshest penalties available, not a slap on the wrist or a 'stop being soooo naughty' message.
Corporations exist by the grace of governments recognizing them as such. They want to be 'people' when it suits them and eternal constructs with zero responsibility when that suits them instead. I think we should treat them a bit more like people and kill a couple of the worst abusers. See if that angle yields the right response.
After that the shareholders get to pick over the leftovers. It's the corporate equivalent of the death penalty and since these companies are responsible for the lives of those that depend on affordable medication this sort of money grab is a reason people have reduced quality of life or die. It's beyond disgusting and such abuses deserve the harshest penalties available, not a slap on the wrist or a 'stop being soooo naughty' message.
Corporations exist by the grace of governments recognizing them as such. They want to be 'people' when it suits them and eternal constructs with zero responsibility when that suits them instead. I think we should treat them a bit more like people and kill a couple of the worst abusers. See if that angle yields the right response.
Agreed 100%. The idea of what a corporation is and what their purpose is in society has been badly warped over the years. A correction is in order.
As much as I'd love to see ridiculous parent laws in medicine get under control, I have very little confidence that Lina Kahn would accomplish anything. She doesn't have a great track record. You really need someone with a good background in patent law specifically for pharmaceuticals to take this on
Definitely, experience matters. However, I am used to an FTC that turns a blind eye on these Pharma antics. So, as long as FTC takes these kind of cases on, I am all for it.
Even the price of generics are way out of line when compared to the generics you get outside of US.
Similarly, a lot of Mergers have resulted in fewer competition in the market, leading to rampant price inflation. Federal institutes like FTC need to step up their game here.
I guess increasing awareness on the issue is better than nothing. I've just noticed that she has a gift for identifying problematic industries but struggles to come up with clear criticisms that could translate into pragmatic solutions.
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"An Orange Book listing shows "approved prescription drugs, related patent and exclusivity information, and therapeutic equivalence evaluations, along with other information."
https://www.fda.gov/drugs/news-events-human-drugs/our-perspe...
So a pharma company can insert a listing saying that, for a bogus example, "Vioxx has no approved generics, because all substitutes are under patent or patent pending." when that is untrue.
This seems clearly illegal and abusive.
From the headline, I thought Kahn was saying that filing a trivial patent "improving" Vioxx would be illegal. But that's not it.