Senator slams unusual Allergan patent deal with Tribe

US Senator Sherrod Brown said on Friday a deal that pharmaceutical giant Allergan Plc made with a Native-American tribe to shield patents “rips off consumers” and cannot “become the new normal,” Reuters reported.

The Ohio Democrat said he will look at how Congress can “close loopholes that drug companies exploit to avoid competition.”

Brown’s staff has requested a meeting with Allergan representatives to press them about the transaction.

Allergan told Reuters it has reached out to Brown’s office “to provide the facts and context around this agreement with the Saint Regis Mohawk Tribe.”

Allergan said on September 8 it had taken the unusual step of transferring the patents of its blockbuster dry eye drug Restasis to the Saint Regis Mohawk Tribe in a bid to gain sovereign immunity from inter partes review (IPR) challenges.

Allergan said the Tribe now owned all Orange Book-listed patents for Restasis (Cyclosporine Ophthalmic Emulsion) 0.05% and that Allergan had been granted exclusive licenses in the patents related to the product.

Allergan said the Tribe, a recognized sovereign tribal government, was filing a motion to dismiss the ongoing inter partes review (IPR) of the Restasis patents based on the Tribe’s sovereign immunity from IPR challenges.

The Tribe will receive $13.75 million upon execution of the agreement and will be eligible to receive $15 million in annual royalties.

The Tribe’s sovereign status could put the patents beyond the authority of the Patent Trial and Appeal Board, an administrative court created in 2011 that can cancel patents.

Allergan has said the move is intended merely to shield the company’s Restasis patents from review at the patent board and would not affect patent challenges filed in federal court.

“We have clearly stated that this agreement with the Tribe has no impact on the pending patent litigations regarding the Restasis patent family which recently completed a five-day trial in Federal District Court in Marshall, Texas,” Allergan said in a statement.