Protecting Consumer Access to Generic Drugs Act of 2026
- Sponsor
- Rep. Magaziner, Seth [D-RI-2]
- Committees
- Judiciary Committee (primary)
- Last action
- Oct 22, 2026
Bottom line
This bill aims to lower prescription drug costs by preventing anti-competitive 'pay-for-delay' agreements that keep generic and biosimilar drugs off the market.
What it actually does
This bill prohibits brand-name drug manufacturers from entering into agreements with generic or biosimilar drug manufacturers that involve compensation in exchange for delaying the market entry of a generic or biosimilar product. It grants the Federal Trade Commission (FTC) enhanced enforcement authority, including the power to levy significant civil penalties, and amends existing law to require more comprehensive certification of settlement agreements and to impose forfeiture of 180-day exclusivity for violations.
Proponents argue
Supporters argue that 'pay-for-delay' agreements are anti-competitive practices that artificially inflate drug prices and deny consumers access to more affordable generic and biosimilar alternatives. This legislation would promote timely market entry of lower-cost medications, fostering competition and significantly reducing healthcare expenditures for patients and federal programs.
Opponents contend
Opponents, typically brand-name drug manufacturers, might contend that these settlements are legitimate business practices that efficiently resolve complex and costly patent litigation, providing legal certainty for all parties. They may argue that prohibiting such agreements could lead to more protracted and expensive legal battles, potentially delaying generic entry even further or increasing overall litigation costs.
The bill is relatively concise for its subject matter, but its legal and industry-specific terminology requires careful reading to fully grasp its implications for pharmaceutical companies and regulatory bodies.
Section 2(a)
Prohibition on Pay-for-Delay Agreements
This section makes it unlawful for a brand-name drug manufacturer (NDA or BLA holder) and a generic or biosimilar manufacturer (subsequent filer) to enter into agreements that settle patent infringement claims if the generic/biosimilar manufacturer receives anything of value (including a license) and agrees to limit or delay the market entry of their product. This directly targets the practice of 'pay-for-delay' settlements.
Supporters argue
Supporters argue this provision directly targets anti-competitive practices that keep drug prices high, ensuring that generic and biosimilar alternatives reach the market more quickly, thus benefiting consumers.
Critics contend
Opponents may argue that these settlements are a legitimate way to resolve complex patent litigation, and prohibiting them could lead to more prolonged legal battles, ultimately delaying generic entry or increasing litigation costs for all parties.
Tradeoffs
This provision balances the desire for lower drug prices through increased competition against the perceived need for legal certainty and efficient resolution in complex pharmaceutical patent disputes.
Section 2(b)
Exclusion for Legitimate Goods or Services
An agreement is not unlawful under this Act if a party can demonstrate by 'clear and convincing evidence' that any value received by the subsequent filer is solely compensation for other legitimate goods or services provided, and not for delaying market entry. This aims to prevent the bill from inadvertently penalizing legitimate business collaborations.
Section 2(c)
Permitted Settlement Considerations
This section clarifies that certain types of consideration granted in a patent settlement agreement are not prohibited. These include the right to market the covered product before the expiration of a patent or statutory exclusivity, payments for reasonable litigation expenses not exceeding $7,500,000, and a covenant not to sue on a patent infringement claim. This provides a 'safe harbor' for common, non-anti-competitive settlement terms.
Section 2(d)
FTC Enforcement Authority and Penalties
This section grants the Federal Trade Commission (FTC) broad authority to enforce the Act, treating violations as unfair or deceptive acts under the Federal Trade Commission Act. The FTC can issue cease and desist orders and initiate civil actions to recover civil penalties. Penalties can be up to three times the value attributable to the violation, with courts considering factors such as culpability, history of violations, and the amount of commerce affected.
Section 3
Enhanced Reporting and Certification of Agreements
This section amends the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 to expand the requirement for filing settlement agreements to include those involving biosimilar biological products. Crucially, it adds a new certification requirement: the Chief Executive Officer or the company official responsible for negotiating the agreement must certify under penalty of perjury that the filed materials represent the complete, final, and exclusive agreement, including any ancillary or oral agreements related to the settlement.
Section 4
Forfeiture of 180-Day Exclusivity Period for Violations
This section amends the Federal Food, Drug, and Cosmetic Act to mandate that if an agreement is found to violate Section 2 of this Act (i.e., it's an unlawful pay-for-delay agreement), the generic drug manufacturer (subsequent filer) involved forfeits its valuable 180-day marketing exclusivity period. This exclusivity is a significant incentive for generic manufacturers to challenge brand-name patents.
This subsection limits the judicial review of FTC cease and desist orders issued for violations of this Act to specific U.S. Courts of Appeals: either the D.C. Circuit or the circuit where the ultimate parent entity of the NDA/BLA holder or subsequent filer is incorporated.
Section 2(d)(2)(C)
Why it matters:Establishing specific jurisdictional rules for new legal actions is standard legislative practice to streamline appeals and potentially foster consistent legal interpretations. However, its technical nature means it could be easily overlooked by a casual reader focused on the substantive prohibitions.
Case for: Proponents would argue that centralizing or limiting judicial review to specific circuits can help develop consistent legal interpretations and streamline the appeals process for these complex antitrust cases, leading to more efficient enforcement.
Case against: Critics might argue that limiting the choice of appellate court could be seen as restricting access to justice or creating an unfair advantage for the government, as it might force companies to litigate in less convenient or less familiar jurisdictions.
Estimated impact: This provision affects the legal strategy and costs for pharmaceutical companies challenging FTC orders, potentially influencing their choice of legal counsel and litigation approach.
The definitions for 'NDA or BLA holder' and 'subsequent filer' are exceptionally broad, encompassing not only the direct application holders but also any person owning or controlling patent enforcement, and their extensive corporate affiliates (predecessors, subsidiaries, divisions, groups, licensees, licensors, successors, and assigns), with control presumed by 50% or greater share ownership.
Section 2(g)(5) and (8)
Why it matters:This is standard legislative practice to ensure the scope of the law is comprehensive and prevents evasion through complex corporate structuring. The detailed nature is necessary for legal precision but makes it dense for a casual reader.
Case for: Proponents would argue that broad definitions are essential to prevent sophisticated corporate structures from being used to circumvent the law's intent to prohibit pay-for-delay agreements, ensuring that all relevant parties in a corporate family are held accountable.
Case against: Some might argue that such broad definitions could inadvertently capture entities or agreements that are not directly involved in the anti-competitive behavior, leading to potential overreach or unintended consequences for legitimate business relationships within large corporate groups.
Estimated impact: This significantly expands the reach of the prohibition, impacting a wider range of corporate entities and their agreements within the pharmaceutical industry, requiring comprehensive compliance across entire organizational structures.