(Reuters)—A U.S. House of Representatives subcommittee on Thursday called a November 7 hearing on the legitimacy of an agreement between drugmaker Allergan Plc and a Native American tribe intended to shield patents from administrative review.
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The House Judiciary Committee’s subcommittee on intellectual property, chaired by Republican Representative Darrell Issa of California, said in a statement that the hearing would include testimony from four experts on patent law, including a former in-house attorney at drug company Johnson & Johnson and a lawyer with a trade group representing the software industry.
An Allergan spokesman declined to comment on whether the company would send any executives to the hearing.
Allergan on September 8 transferred patents on its dry eye medication Restasis to the upstate New York Saint Regis Mohawk Tribe, which agreed to exclusively license the patents back to the company in exchange for ongoing payments.
According to Allergan, the tribe’s status as a sovereign entity places the patents outside the jurisdiction of the U.S. Patent Trial and Appeal Board, an administrative court created by Congress in 2011 that can cancel patents it decides should not have been granted.
Generic drug companies frequently ask the tribunal to revoke patents on brand-name prescription drugs in hopes of launching their own lower-cost versions. A challenge to Allergan’s Restasis patents brought by rival Mylan NV is pending before the board.
Allergan Chief Executive Brent Saunders has said the patent tribunal is a flawed and unfair forum. He has said Allergan would not object to the Restasis patents being reviewed in federal court, which it called a fair and time-tested process.
A federal court invalidated Allergan’s Restasis patents on October 16, rendering the tribal deal mostly meaningless. Allergan has appealed that ruling.
Lawmakers have called Allergan’s deal with the tribe a sham transaction. A bipartisan group of four representatives from the House Oversight and Government Committee on October 3 asked Allergan to provide documents about its agreements with the tribe.
After the ruling the Saint Regis Mohawk Tribe said it was eager to make similar deals with other patent owners to generate much-needed revenue for its members.