Non-Price Competition in “Substitute Drugs: The FTC\u27s Blind Spot

As the recent case of United States v. Lundbeck illustrates, the Federal Trade Commission’s lack of knowledge in medical and pharmacological sciences affects its evaluation of transactions between medical and pharmaceutical companies that involve transfers of rights to manufacture or sell drugs, causing the agency to object to such transactions without solid basis for doing so. This article argues that in order to properly define a pharmaceutical market, one must not just consider the condition that competing drugs are meant to treat, but also take into account whether there are “off-label” drugs that are used to treat a relevant condition, whether drugs actually compete with each other on price or whether they are selected based on their side-effects (or lack thereof), mechanism of action, physician knowledge, and other noneconomic considerations, and finally whether the drugs in question enjoy any patent or nonpatent-based exclusivity that prevents generic manufacturers from entering the market

Non-Price Competition in “Substitute Drugs: The FTC\u27s Blind Spot

As the recent case of United States v. Lundbeck illustrates, the Federal Trade Commission’s lack of knowledge in medical and pharmacological sciences affects its evaluation of transactions between medical and pharmaceutical companies that involve transfers of rights to manufacture or sell drugs, causing the agency to object to such transactions without solid basis for doing so. This article argues that in order to properly define a pharmaceutical market, one must not just consider the condition that competing drugs are meant to treat, but also take into account whether there are “off-label” drugs that are used to treat a relevant condition, whether drugs actually compete with each other on price or whether they are selected based on their side-effects (or lack thereof), mechanism of action, physician knowledge, and other noneconomic considerations, and finally whether the drugs in question enjoy any patent or nonpatent-based exclusivity that prevents generic manufacturers from entering the market

Resolving the Original Sin of Bolling v. Sharpe

On May 17, 1954 the Supreme Court handed down two decisions that for the first time categorically held that racial segregation in public schools was per se unlawful – Brown v. Board of Education and Bolling v. Sharpe. Ostensibly, both cases dealt with a same question; however, in Brown the entity accused of discrimination was a creature of the State of Kansas, while in Bolling the discrimination was practiced by the federal government. The problem that the Supreme Court faced was the language of the Fourteenth Amendment, which, by its own terms, guaranteed “equal protection of the laws” only vis-à-vis states and not the federal government. The Supreme Court recognized as much in Bolling, but ruled segregation illegal in the District of Columbia anyway. Bolling is now universally recognized as reaching an unquestionably correct result as a policy and moral matter. This recognition makes it all the harder for the adherents of originalism to defend their preferred approach to constitutional interpretation. Originalists are forced to concede that the Constitution, interpreted as originally understood, did not impose equal protection restraints on the federal government, and therefore, Bolling, in imposing these norms where they were not meant to be, was wrongly decided. Recognizing the political (and moral) problem with this approach, originalists have simply attempted to waive the problem away. The problem is that at least in the popular perception “[a] theory of constitutional interpretation that cannot account for Brown [and Bolling] is suspect if not discredited.” Some scholars, Robert Bork and Randy Barnett amongst them, have argued that although Bolling is indefensible as an originalist matter, this is not a real problem. According to them, even if Bolling were overruled no major problems would arise, if for no other reason than the federal government is politically constrained from running segregated schools or otherwise discriminating on the basis of race. This proposition is both dubious as a factual matter (or at the very least was so when Bolling was decided), and is unsatisfactory as a political matter. The general public is simply unlikely to buy into a judicial theory that would permit the federal government to discriminate at will on the basis of race. Accordingly, if originalism is to be broadly accepted by the public without being undermined by the discussion of Bolling and Brown, one needs to come up with a plausible explanation of how the results (if not the rationale) in those two cases can be supported under an originalist approach to constitutional interpretation. In this Article I argue that Bolling is justifiable as an originalist matter if one properly interprets the Citizenship Clause of the Fourteenth Amendment. Properly understood, the clause was meant to protect not just a right to a passport or nationality, but a much broader right of equal participation in the civic life of the Nation. The term “citizen” was understood by the framers and ratifiers of the Fourteenth Amendment to encompass a wide scope of political rights, including a right to equality before the law. When viewed from that perspective, it becomes apparent that Bolling was correctly decided not only from the political perspective, but from legal originalist one as well

Speaking of Science: Introducing Notice and Comment into the Legislative Process

Congress enacts, on a nearly continuous basis, a variety of laws that affect scientific research and progress. Some of these laws have an unquestionably positive effect. For instance, Congress\u27s creation of the National Institutes of Health, the National Academy of Sciences, and NASA; its various appropriations to fund ground-breaking research; and a multitude of other laws have incalculably advanced human knowledge, and it is to Congress\u27s great credit that these laws have been and are continuing to be enacted. However, not all laws that affect the progress of sciences are an unalloyed good. Quite the opposite, often the laws aim to, and in fact do, retard the progress of scientific research. The question is then whether the benefit from those laws outweighs the costs imposed on scientific progress. Congress, however, often does not fully consider the costs that the legislation imposes on science, either for lack of information or as a result of conscious disregard for the views of a politically insignificant group. The public is not able to hold Congress accountable because it lacks an ability to participate in the process and lacks an objective basis against which to measure congressional action. The problem is not congressional malfeasance or ignorance but rather the structure of the legislative process itself The general public is often taught and told that lawmaking is a process that begins in a committee where the proposal is carefully studied, debated, amended, and voted on. The reality, of course, is much different. First, bills often skip the committee process, and amendments are often added last minute without a chance for a meaningful debate. But even where the process is followed, it is often hard to portray the committee hearings as a true deliberative process. Instead, they are often described as a Kabuki theater, where the Chair and the Ranking Member designate the witnesses they wish to call to support the preformulated position. Interested parties cannot provide testimony unless asked to do so by the relevant committee. Thus, oftentimes the people with the deepest knowledge, but low political skills, are cut out of the process. The end result is that Congress votes on legislation without fully understanding the implication thereof The voters also are injured in that it is hard to hold Congress accountable if one cannot point out that it ignored the views of the scientific communities. This Article proposes a solution to the problem. Bills that affect the progress of science ought to be evaluated by an independent body similar to the Congressional Budget Office. Like the CBO, this body would not have any authority to block a bill, but it would be able to score it (i.e., provide information on the effect the bill will have on research). In order to accomplish its task, this newly created body would be required to provide notice of pending legislation and then seek comments from the interested parties, much like what is done in the administrative rulemaking process. The comments then would be collected and analyzed, and the final report would be presented to Congress before it votes. Congress would continue to be able to vote as it pleases, but with this process in place, it would be forced to do so with its eyes wide open. By understanding the full scope and the implication for the scientific progress of the bills it wishes to enact, Congress would produce better legislation, which would be less detrimental to the scientific progres

The Great Writ of Incoherence: An Analysis of Supreme Court\u27s Rulings On Enemy Combatants

On June 28, 2004, the United States Supreme Court released its much awaited decisions in the cases posing a challenge to the Executive\u27s self-professed authority to detain and indefinitely hold individuals designated as enemy combatants. The cases arose from the war on terrorism that was launched after the attack on the United States on September 11, 2001. When each decision is looked at individually, the result seems to make sense and, given the outcome (affording detainees rights of judicial review), feels good. Yet when these decisions are looked at collectively, it is hard to believe that they were issued by the same complement of Justices, much less on the same day. Moreover, when the decisions rendered on June 28, 2004, are read in concert with previous decisions dealing with the habeas corpus rights of non-citizen detainees, the legal landscape becomes quite muddled. This Article seeks to show inconsistencies in the three Enemy Combatant Cases, as well as the potentially catastrophic interaction of these cases with Zadvydas v. Davis, a case decided in 2001. Part II of this Article describes the historical and political background of these cases and summarizes the Supreme Court\u27s opinion in each case. Part III points out the tension between these decisions and suggests that it is impossible for all three to be implemented as written. Part IV addresses the far-reaching implications of Rasul v. Bush on the present and future military operations and argues that that decision has the potential to wreak havoc on the military\u27s ability to effectively detain and interrogate terrorists and prisoners of war (POWs). Part V addresses the interaction of Rasul and Zadvydas and suggests that if the decisions are meant to be read in concert, they may require a highly implausible result of releasing individuals whom the military considers to be dangerous into the very country that these individuals wish to destroy. Part VI proposes a restricted construction on these decisions so as to limit the potential damage that these decisions can cause. The Article concludes its analysis in Part VII

Resolving the Original Sin of Bolling v. Sharpe

On May 17, 1954 the Supreme Court handed down two decisions that for the first time categorically held that racial segregation in public schools was per se unlawful – Brown v. Board of Education and Bolling v. Sharpe. Ostensibly, both cases dealt with a same question; however, in Brown the entity accused of discrimination was a creature of the State of Kansas, while in Bolling the discrimination was practiced by the federal government. The problem that the Supreme Court faced was the language of the Fourteenth Amendment, which, by its own terms, guaranteed “equal protection of the laws” only vis-à-vis states and not the federal government. The Supreme Court recognized as much in Bolling, but ruled segregation illegal in the District of Columbia anyway. Bolling is now universally recognized as reaching an unquestionably correct result as a policy and moral matter. This recognition makes it all the harder for the adherents of originalism to defend their preferred approach to constitutional interpretation. Originalists are forced to concede that the Constitution, interpreted as originally understood, did not impose equal protection restraints on the federal government, and therefore, Bolling, in imposing these norms where they were not meant to be, was wrongly decided. Recognizing the political (and moral) problem with this approach, originalists have simply attempted to waive the problem away. The problem is that at least in the popular perception “[a] theory of constitutional interpretation that cannot account for Brown [and Bolling] is suspect if not discredited.” Some scholars, Robert Bork and Randy Barnett amongst them, have argued that although Bolling is indefensible as an originalist matter, this is not a real problem. According to them, even if Bolling were overruled no major problems would arise, if for no other reason than the federal government is politically constrained from running segregated schools or otherwise discriminating on the basis of race. This proposition is both dubious as a factual matter (or at the very least was so when Bolling was decided), and is unsatisfactory as a political matter. The general public is simply unlikely to buy into a judicial theory that would permit the federal government to discriminate at will on the basis of race. Accordingly, if originalism is to be broadly accepted by the public without being undermined by the discussion of Bolling and Brown, one needs to come up with a plausible explanation of how the results (if not the rationale) in those two cases can be supported under an originalist approach to constitutional interpretation. In this Article I argue that Bolling is justifiable as an originalist matter if one properly interprets the Citizenship Clause of the Fourteenth Amendment. Properly understood, the clause was meant to protect not just a right to a passport or nationality, but a much broader right of equal participation in the civic life of the Nation. The term “citizen” was understood by the framers and ratifiers of the Fourteenth Amendment to encompass a wide scope of political rights, including a right to equality before the law. When viewed from that perspective, it becomes apparent that Bolling was correctly decided not only from the political perspective, but from legal originalist one as well

Googling Down the Cost of Low Sanctions

This brief solicited response addresses Prof. Irina Manta\u27s article The High Cost of Low Sanctions, which appeared in 66 Florida Law Review 157 (2014). Prof. Manta argued argues that to the extent the substantive law is unjust, low sanctions, in the long run, potentially create more problems and are more likely to perpetuate injustice than high sanctions would. She demonstrates that the general theory is applicable to the world of copyright, and then explains why as of late, the public has become more aware of and more resistant to the imposition of additional sanctions. In Professor Manta\u27s view, the reason for this is the ubiquity of infringement. In response, while generally agreeing with Professor Manta\u27s observations, I critique her work for not giving enough weight to alternative explanation — that the rise of corporate giants like Google, YouTube, Wikipedia, and other businesses that collect and disseminate information has provided political counterweight to to the Disneys, Viacoms, and RIAAs of the world. I compare this new and more balanced representation of copyright views to what has been happening in the world of patents where corporate titans in various industries present arguments for both stronger and weaker patent law, with the final bills ending up somewhere in between. Ultimately, I suggest that perhaps, the high cost is imposed not by low sanctions, but, at least in part, by absence of the organized and well funded opposition that would be affected by these sanctions

Reverse Settlements as Patent Invalidity Signals

Over the last decade a new type of settlements, commonly referred to as “reversed payment settlements” or simply “reverse settlements,” emerged in litigation over patents covering pharmaceutical products. What differentiates these new settlements from their traditional counterparts is that whereas traditionally, the alleged trespasser on someone else\u27s rights pays the rights-holder to settle the litigation, in these new settlements it is the rights holder that pays the alleged trespasser. These settlements are a direct consequence of the various incentives provided by the Hatch-Waxman Act - an Act designed to increase competition between brand name and generic manufactures of pharmaceutical products. In this Article, I propose a new approach and argue the proper way to police these agreements is not by subjecting them to an antitrust analysis, but by ordering a reexamination of any patent involved in a reverse settlement. The question of whether any reverse settlement is pro- or anti-competitive, turns on the strength of the patent and the likely conclusion of the litigation. The antitrust analysis is simply not designed to address the patent scope and validity issues, and therefore cannot properly differentiate between pro- and anti-competitive settlements. The patent law, on the other hand, is designed to evaluate the strength of the patent, and is therefore an obvious candidate to police reverse settlements. By employing the Patent Office\u27s existing (but broadened) reexamination authority, weak patents can be invalidated and removed from the marketplace, thus opening up the market for new generic entrants. Additionally, if patentees know that their patents may be subject to reexamination, they will be less likely to enter into anti-competitive settlements. By expanding the scope of Patent Office\u27s reexamination authority, and by assigning the task of evaluating the ultimate validity of questionable patents to the agency with expertise in patent law, the ability of parties to enter into beneficial and legitimate settlements, as well as consumer access to lower cost drugs and medical devices will both be preserved

Exclusivity Without Patents: The New Frontier of FDA Regulation for Genetic Materials

Over the last twenty years, the legal and scientific academic communities have been embroiled in a debate about the patent eligibility of genetic materials. The stakes for both sides could not be higher. On one hand are the potential multi-billion dollar profits on the fruits of research (from newly discovered genes), and on the other is scientists\u27 ability to continue and expand research into the human genome to improve patients\u27 access to affordable diagnostic and therapeutic modalities. This debate is currently pending before the Supreme Court, which is considering a petition for certiorari in Ass\u27n for Molecular Pathology v. U.S. Patent & Trademark Office. Both sides have legitimate concerns. Given the unique nature of DNA, patents that broadly cover genetic materials and prevent their use (except by the license of the patentee) create insurmountable roadblocks for future research. However, denying exclusive rights to the fruits of laborious and costly research will remove the necessary incentives for investment in these endeavors, thus delaying scientific and medical discoveries. To remedy these problems, this Article proposes a non-patent exclusivity system administered by the Food and Drug Administration. Under such a system, the innovators who bring new therapeutic or diagnostic products to market would receive exclusive rights to market their products for a limited time. This regime would provide sufficient market-based incentives to continue with the research and investment in this area. At the same time, because genetic sequences would no longer be broadly protected by patents, the public would be able to access these basic research tools without fear of infringement litigation. This approach addresses the concerns of both sides to the debate and leads to a cheaper, more predictable, and easier to administer system of exclusive rights