Law360, New York (July 6, 2015, 12:08 PM EDT) -- For well over a decade, litigants and courts have hotly debated whether patent settlement agreements that involve a payment from the branded drug company to the generic accused infringer (so-called "reverse payment settlements") violate the antitrust laws. From the standpoint of economics, a key issue is whether or not the branded drug company's patent is valid, and has been infringed. If the generic manufacturer is infringing a valid patent, then under the patent laws, the branded drug company has the right to enforce its patent and exclude the potential generic entrant. However, if the branded drug company's patent is invalid — or the generic manufacturer does not infringe the patent — then the branded drug company does not have this exclusionary right and a settlement containing a large reverse payment that both avoids an adverse decision on patent validity (and/or infringement) and induces the generic manufacturer to delay entry may be viewed as anti-competitive.[1]...