In FTC v. Actavis, the Supreme Court held that large reverse payments could be evidence of anticompetitive conduct. But how do courts determine that a payment is “large”?
The answer involves the probability that a generic would have won the patent case, a number for which there is no generally accepted way of estimation in antitrust litigation.
In this episode, using the recent Takeda case of an $885 million verdict as a case study, it explains:
Economic logic of reverse payments
Why is the Actavis framework circular?
How damages models rely on unspoken assumptions
Why juries prefer stories to methods
This is not only a case about pharmaceuticals but also a structural problem in antitrust economics.
Read the full article and the graphic analysis:
