Markets Wired

FTC Files Amicus Brief in Support of Rehearing of Ciprofloxacin “Pay-for-Delay” Case

The Federal Trade Commission has filed an amicus brief in the U.S. Court of Appeals for the Second Circuit, recommending that it hold a rehearing before all the judges (“en banc”) of the Ciprofloxacin (Cipro) “pay-for-delay” case.

The case concerns payments made by Bayer AG, the branded manufacturer of Cipro, to potential generic competitors. In 1997, to settle patent litigation, Bayer paid its potential generic competitor a total of $398.1 million in exchange for the generic’s agreement to stay off the market for six years. On April 29, 2010, the Second Circuit ruled in favor of the defendants in this case, bound by an earlier decision. The Court, however, invited the plaintiffs to seek review by the full Court of Appeals, citing the “exceptional importance” of the antitrust implications of “pay-for-delay” settlements.

In its brief, the FTC states that the rehearing is needed so the court can reconsider an earlier ruling regarding “pay-for-delay” which “effectively shields a pernicious practice, which imposes enormous costs on American consumers for pharmaceutical drugs, from antitrust scrutiny.”

The name of the case is Arkansas Carpenters Health Welfare Fund, et al. v. Bayer AG, Bayer Corp., et al. (Civ. Nos. 05-2851-CV(L) and 05-2852-CV(CON)) It is on appeal from the U.S. District Court for the Eastern District of New York.

The FTC vote approving the amicus brief filing was 5-0. It was filed on May 20, 2010. A copy of the filing can be found on the FTC’s Web site and as a link to this press release. (FTC File No. P072104; the staff contact is Imad Dean Abyad, Office of General Counsel, 202-326-2375.)

FTC Approves Final Rule to Inform Consumers About Deposit Institutions That Lack Federal Deposit Insurance

The Federal Trade Commission has approved a final rule requiring depository institutions that lack federal deposit insurance to disclose that information to consumers.

The vast majority of depository institutions, including all federally chartered and most state-chartered banks, thrifts, and credit unions, are required to have federal deposit insurance that currently guarantees all deposits up to $250,000 per depositor. The Federal Deposit Insurance Corporation Improvement Act requires depository institutions without federal deposit insurance to provide disclosures that they lack such insurance, and directs the FTC to develop regulations for these required disclosures.

The FTC is now issuing a final rule in accordance with that law. Among other things, the Rule requires institutions without federal deposit insurance to disclose that they are not federally insured and that the federal government does not guarantee consumers will get their money back if the institution fails. These disclosures must be made on account statements, in advertising, and inside branches at deposit windows.

The Commission vote to publish the final rule in the Federal Register notice was 5-0. (FTC File No. R411014; the staff contact is Hampton Newsome, Bureau of Consumer Protection, 202-326-2889.)

Copies of the documents mentioned in this release are available from the FTC’s Web site at http://www.ftc.gov and from the FTC’s Consumer Response Center, Room 130, 600 Pennsylvania Avenue, N.W., Washington, DC 20580. Call toll-free: 1-877-FTC-HELP.

(FYI 22.2010.wpd)