Companies like Allergan (AGN), Valeant (VRX) and Mallinckrodt (MNK) have become synonymous with the rising costs of drugs, and price-gouging by drug companies. Allergan may have become the poster child for drug companies’ shenanigans used to protect branded drugs. The company sold patents for dry-eye drug Restasis to the St. Regis Mohawks in order to protect Restasis from an inter partes review (“IPR”).

The ploy got Senator Claire McCaskill’s dander up; McCaskill later drafted a bill disallowing tribal sovereign immunity to be used to block U.S. Patent and Trademark Office review of patents:

“Any thinking person would look at what this company did and say, ‘That should be illegal.’ Well, I agree,” McCaskill said in a statement. “Congress never imagined tribes would allow themselves to be used by pharmaceutical companies to avoid challenges to patents, and this bill will shut the practice down before others follow suit.”

Allergan may have out-smarted itself in fighting generic competition for Restasis patents that were set to expire in the second half of 2014. U.S. District Judge Harvey Bartle recently ruled AbbVie’s sham litigation illegally prevented generic versions of AndroGel from getting to market. Judge Bartle ordered AbbVie and its partner to pay $448 million, representing over 4 years of AndroGel profits. The $448 million pay out is a rounding error for AbbVie; however, it could have major implications for Allergan, which I talked about earlier.

Judge Bartle, Teva, Mylan, et. al are all aiming for Allergan. According to Shocking The Street, a premium investment service the Shock Exchange runs in conjunction with Seeking Alpha, Amgen is the next company to take a bite out of Allergan. Read more:



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