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January 16, 2015
Brattle Economists Sign Amicus Brief in Support of Defendants Actavis PLC in Pharmaceuticals Antitrust Case

Brattle economists Lisa Cameron and Steven Herscovici recently assisted in preparing an amici curiae brief in support of the defendants-appellants Actavis PLC and its subsidiary, Forest Laboratories LLC, in an antitrust case in the United States Court of Appeals for the Second Circuit. Drs. Cameron and Herscovici worked with attorneys William Roberts, Sheila Branyan, Ann Querns, and Jeremy Rist at Blank Rome and were joined in preparing and signing the brief by internationally renowned academics including Brattle Academic Advisor Henry Grabowski, as well as consultants with expertise in the economics of the pharmaceutical industry.

The brief recommends that the Court of Appeals for the Second Circuit reverse and vacate the District Court for the Southern District of New York’s preliminary injunction requiring the defendants to continue to produce and market Namenda IR, an Alzheimer’s drug, until thirty days after generic versions launch in July 2015. Amici believe that this ruling will impose significant economic costs for Actavis that will not be outweighed by any economic benefit.

This decision, the amicus brief states, will set a precedent that undermines incentives for innovation in the pharmaceutical industry. The authors of the brief also argue that the large public and private insurers that pay for the vast majority of prescriptions of drugs like Namenda IR have both the incentive and ability to ensure that the market will produce a competitive outcome without the need for further government intervention. Thus, the decision to withdraw a branded drug from the market should be left to the manufacturer, in response to normal market forces.

The full brief may be viewed using the link below.