Litigation in Generic Markets: How Patent Disputes Delay Affordable Medicines

Litigation in Generic Markets: How Patent Disputes Delay Affordable Medicines

When a brand-name drug’s patent expires, you’d expect generics to flood the market, lowering prices and giving patients more options. But in reality, many of these drugs stay expensive for years longer than they should. Why? Because patent litigation has become a strategic tool-not just to protect innovation, but to block competition.

How the System Was Supposed to Work

The Hatch-Waxman Act of 1984 was designed to strike a balance. It gave brand-name drug companies extra patent time to make up for delays in FDA approval, while giving generic makers a faster, cheaper path to market through Abbreviated New Drug Applications (ANDAs). The key part? Paragraph IV certifications. When a generic company files one, it says: "This patent is invalid or won’t be infringed." That triggers a 30-month clock. During that time, the FDA can’t approve the generic-unless the court rules in the generic’s favor.

This wasn’t meant to be a delay tactic. It was supposed to be a fair test: if the patent holds up, the generic waits. If it doesn’t, the market opens. But over time, the system got twisted.

The Orange Book: A Legal Weapon in Disguise

The FDA’s Orange Book lists every patent tied to a brand-name drug. Only certain patents belong there: those covering the active ingredient, how it’s made, or how it’s used. But companies have found loopholes. They list patents for things like inhaler nozzles, packaging, or delivery devices-even when those aren’t part of the drug itself.

In 2025, Judge Chesler ruled in Teva v. Amneal that six patents on a dose counter for ProAir® HFA didn’t qualify. The drug was albuterol sulfate inhalation aerosol. The counter? A device. Not the drug. That ruling was a big deal. Experts say it could invalidate 15-20% of all Orange Book listings right now.

But the damage is already done. Brand companies have used this tactic for years. One drug, Eliquis (apixaban), has 67 patents. Semaglutide products (Ozempic, Wegovy, Rybelsus) have 152. Oncology drugs average 237. These aren’t just protections-they’re walls.

Serial Litigation: The Delay Game

It’s not enough to file one lawsuit. Some brand companies play a game called serial litigation. They hold back patents, letting the first one expire, then file a new suit on a second patent. Then a third. And a fourth. The goal? Keep the 30-month stay going-over and over.

The Association for Accessible Medicines found cases where generic entry was delayed by 7 to 10 years after the original patent expired. That’s not legal protection. That’s market control. And it’s expensive. The FTC estimates improper Orange Book listings delay generic competition for about 1,000 drugs every year, costing the system $13.9 billion annually.

Robotic branded drugs with multiple patent cores freezing generic capsules, while a worker tries to break the 30-month clock.

Where Lawsuits Are Fought: The Eastern District of Texas

Not all courts are the same. In 2024, the Eastern District of Texas became the top venue for patent cases-38% of all filings. Why? It’s known for being fast, predictable, and favorable to patent holders. Even after the TC Heartland decision tried to limit forum shopping, big pharma companies moved back here. The District of Delaware and Western District of Texas trail behind at 15% and 22% respectively.

Law firms like Fish & Richardson and Quinn Emanuel saw 35-40% revenue jumps in patent litigation in 2024. This isn’t just legal work-it’s a booming business.

Settlements: Pay-for-Delay or Faster Access?

When a brand company sues a generic maker, they often settle. But these deals look suspicious. Sometimes, the brand pays the generic to stay off the market. That’s called a pay-for-delay settlement-and the FTC calls it illegal.

But here’s the twist. A 2025 IQVIA report, commissioned by the same group that criticizes pay-for-delay, found that most settlements actually get generics to market faster-on average, more than five years before the patent expires. Why? Because without the chance to settle, generic companies won’t file Paragraph IV challenges at all. They’re scared of losing everything.

So it’s not black and white. Some settlements are anti-competitive. Others are the only way generics can enter at all.

A divided city where patients suffer under expensive drugs, while a protest movement fights for access with glowing petitions.

What’s Changing Now?

The FTC is pushing back. In 2024, they challenged over 300 improper Orange Book listings. In May 2025, they sent warning letters to 200 more patents across 17 drugs, targeting big names like Teva and Amgen. The Department of Justice joined them in March 2025 for listening sessions with generic manufacturers who described how device patents were used to block entry.

The FDA is also stepping in. New rules are coming in Q2 2026 that will require brand companies to certify under penalty of perjury that every patent listed in the Orange Book meets legal standards. That’s a big shift-from voluntary to enforced accountability.

Meanwhile, generic makers are turning to the Patent Trial and Appeal Board (PTAB). Inter partes reviews (IPRs) let them challenge patents outside of court. IPR filings against pharma patents jumped 47% from 2023 to 2024. But the Supreme Court’s April 2025 decision in Smith & Nephew v. Arthrex made it harder for generic companies to file these challenges, raising the bar for standing.

The Bigger Picture: Who Pays the Price?

The average time from brand approval to first generic entry has doubled since 2005-from 14 months to 28 months. For cancer drugs? It’s 5.7 years after patent expiration before generics show up.

Patients pay. Insurers pay. Taxpayers pay. And the companies that make these drugs? They profit from the delay.

The system was built to encourage both innovation and access. Today, it’s tilted hard toward the former. Without reform, the gap between what’s legal and what’s fair will only grow wider.

What’s Next?

Patent litigation in generic markets isn’t slowing down. Lex Machina predicts 25-30% annual growth through 2027. Biosimilars-complex biologic drugs-are adding new layers of complexity. The average number of patents per biologic product is now 78, compared to 37 for traditional pills.

Congress has the power to fix this. But until then, the courts, the FDA, and the FTC are the only checks left. And they’re working against decades of entrenched strategy.

The question isn’t whether patents matter. They do. But when patents are used not to protect invention, but to suppress competition, the system fails the people it was meant to serve.

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