Reverse Payment Settlements

Reverse payment settlements, often called "pay-for-delay" agreements, occur when a brand-name drug company pays a generic manufacturer to delay the release of a cheaper version of a drug. This arrangement can prevent generic competition for a certain period, allowing the brand-name company to maintain higher prices. While companies argue these deals can be legal and beneficial, critics claim they can limit consumer access to affordable medications and violate antitrust laws, as they restrict competition and prolong monopoly pricing. Essentially, it's a financial agreement that can impact drug prices and availability in the market.