Committee probes Allergan patent deal with Tribe

The US House of Representatives’ Committee On Oversight And Government Reform has launched a probe into pharmaceutical giant Allergan’s unusual move 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.

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

Four representatives from the committee — including Republican chairman Trey Gowdy and top Democrat Elijah Cummings — sent a letter to Allergan CEO Brenton Saunders which said: “The unconventional maneuver has received considerable criticism from the generic competitors challenging the drug’s patents under the process Congress created to enable timelier review of such challenges …

“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 letter asks Allergan to provide the following documents and information no later than 5pm on October 17:

  • All agreements and communications between officials at Allergan and the Saint Regis Mohawk tribe referring or relating to the Restasis patents, including but not limited to legal expenses.
  • All analyses conducted in preparation for or relating to any agreements regarding the Restasis patents, including but not limited to all analyses relating to past or future trends or projections for market share.
  • All documents and communications referring or relating to the amount of money received by Allergan from sales of Restasis through federal health care programs, including state programs that receive federal funding.
  • All documents presented to the Allergen board of directors concerning any agreements regarding the Restasis patents.
  • All documents and communications referring or relating to considerations for a similar arrangement and transaction for other products.

The letter reads: “On September 8, 2017, your company announced the transfer of six patents related to its Restasis drug to the Saint Regis Mohawk tribe.

“The unconventional maneuver has received considerable criticism from the generic competitors challenging the drug’s patents under the process Congress created to enable timelier review of such challenges.

“Allergan defended the transfer as a ‘sophisticated opportunity to strengthen the defense’ of Restasis’ patents.

“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 Food and Drug Administration approved Restasis as a chronic dry eye treatment in 2003, at which time one of the original patents on the drug’s active ingredient was set to expire in 2014.

“That same year, Allergan led additional patents extending its protections to 2024.

“As Allergan’s second best-selling drug, Restasis generated nearly $1.5 billion in revenues for the company last year.

“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.”