Pay for delay 2.0: Anticompetitive early generic entry agreements in the Australian pharmaceutical sector

Sven Gallasch

Competition and Consumer Law Journal

Sven Gallasch ‘Pay for delay 2.0: Anticompetitive early generic entry agreements in the Australian pharmaceutical sector’ (2023) 30(1) Competition and Consumer Law Journal 44

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Abstract

Competition is vital for the pharmaceutical sector. It saves Australian consumers millions of dollars. A global competition concern is the so-called ‘pay-for-delay settlements’. In essence, pharmaceutical brand companies in the US and EU aim to delay generic competitors by paying them off. Australia seemed immune to this trend — until now. For the first time, the Australian Competition and Consumer Commission had to consider a new variant of such settlements in 2022. The parties claim that allowing generic competitors to enter early instead of delaying them is purely beneficial to consumers. This article disagrees with this claim. Advocating for increased vigilance, it argues that such settlements can significantly distort the competitive market in the long run at the expense of the public.