Allergan protects Restasis patents with transfer to Native American tribe

Allergan has sold the patents for Restasis to a Native American tribe in an effort to protect their top-selling dry eye drug from generic competition.

The Saint Regis Mohawk Tribe, a recognized sovereign tribal government in upstate New York, now owns the rights to Restasis and has granted Allergan exclusive licenses on the product. Under the terms of the agreement, Allergan will pay the tribe $13.75 million in initial payments, with an additional $15 million in annual royalties until Restasis' patents expire in 2024 or are no longer valid.

According to the press release, Saint Regis will file to dismiss any patent challenges "based on their sovereign immunity from IPR (inter partes review) challenges". Three companies—Teva Pharmaceutical Industries, Mylan NV and Akorn Inc.—have filed IPR challenges related to Restasis (cyclosporine ophthalmic emulsion, 0.05%). 

Allergan's Chief Legal Officer Bob Bailey said that Saint Regis was the one who approached the company with the strategy. The decision to proceed was based on 2 previous cases involving universities that were successful in using their sovereign status to dismiss IPR proceedings.

Sales of Restasis, Allergan's second-biggest seller after Botox, generated $1.4 billion in revenue last year.

The deal comes at an interesting time, as congress recently passed a funding mechanism that could help speed the generic drug approval process. The FDA has also been working on a fast-track process for generics that could reduce approval timelines to as little as 8 months.

"This is a viable and sound opportunity for the Saint Regis Mohawk Tribe to enter into the patent, technology and research sector as part of our overall economic diversification strategy,” the Saint Regis Mohawk Tribal Council said. “We realize that we cannot depend solely on casino revenues and, in order for us to be self-reliant, we must enter into diverse business sectors to address the chronically unmet needs of the Akwesasne community; such as housing, employment, education, healthcare, cultural and language preservation."