On December 7, 2012, the Supreme Court granted certiorari in FTC v. Watson Pharmaceuticals. The Supreme Court is now poised to resolve the circuit split on the treatment of so-called “pay for delay” Hatch-Waxman Act patent litigation settlements.
The Second, Eleventh, and Federal Circuits have all allowed such settlements where they do not exceed the duration or scope of the patent (or involve sham litigation or fraudulently-obtained patents). The Third Circuit has disagreed, finding that payments from patent-holding pharmaceutical manufacturers to generics to stay off the market are prima facie evidence of an antitrust violation.
You can find past blog entries on pay-for-delay issues and the Hatch-Waxman act by using the search feature.