Second Circuit

“Product Hopping”: New Second Circuit Decision Addresses Antitrust Limits on Innovation and Related Marketing Activity

In late May, the U.S. Court of Appeals for the Second Circuit issued the first appellate decision addressing the pharmaceutical industry practice called by some “product hopping”—a two-step process in which a drug approaching the end of its patent term is withdrawn or made less desirable to customers so that patients will switch to a successor product with more exclusivity remaining.  In this way, drug manufacturers may seek to protect sales from generic competition.  “Product hopping” cases are often analyzed under the antitrust rules developed to assess claims of “predatory innovation” or related conduct, as exemplified by well-known cases involving Microsoft and Kodak.  In this article, just published in Law360, lawyers from Orrick’s Intellectual Property and Antitrust groups weigh in on the Second Circuit’s decision, focusing on aspects of the analysis that may not be applicable in different cases and contexts.