WASHINGTON – During a Senate Judiciary Committee hearing on drug pricing, U.S. Senator John Cornyn (R-TX) questioned James Stansel, General Counsel for Pharmaceutical Research and Manufacturers of America, and Michael Carrier, Professor Of Law at Rutgers Law School, on pharmaceutical manufacturers’ utilization of the patent system to prevent competition on certain prescription drugs. Excerpts of Sen. Cornyn’s line of questioning are below, and video can be found here. https://www.youtube.com/watch?v=WW4ptsQf14g&feature=youtu.be

SENATOR JOHN CORNYN: “Just like a financial transaction could be legal in and of itself under certain circumstances, the federal government has defined as money laundering structuring arrangements that are designed to accomplish a certain result… assuming the patent itself was legal, my question is, could they be structured in such a way as to result in an anti-competitive effect?”

JAMES STANSEL: “Well, I do think that where there’s concern, you know, product hopping has been mentioned, if there’s a specific conduct in the marketplace that a company is engaged in…”

SEN. CORNYN: “Professor Carrier, what if we gave the FTC the authority to look at that sort of patent thickets and decide whether there was a noncompetitive effect and provide an equitable remedy?”

MICHAEL CARRIER: “I think that would make perfect sense and that would deal with the problem here… This is an abuse of the system, and giving the FTC power to deal with it will be a great development.”

Senator John Cornyn, a Republican from Texas, is a member of the Senate Finance, Intelligence, and Judiciary Committees.