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# 5th Circuit Backs FTC in Impax ‘Reverse Payment’ Case
- URL: https://www.fdaweb.com/5th-circuit-backs-ftc-in-impax-reverse-payment-case/
- Published: 2021-04-13T12:00:00.000Z
- Updated: 2026-09-14T16:54:33.000Z
- Author: David McFarland
- Tags: Drugs, #legacy-id-D5149101

The 5th Circuit Court of Appeals says the Federal Trade Commission (FTC) did not commit any legal errors and had sufficient substantial evidence to support its factual finding that Impax Laboratories violated antitrust law by accepting payments from Endo worth more than $100 million to delay the entry of its generic form of Endo’s Opana (oxymorphone HCl). The court [says](https://www.ca5.uscourts.gov/opinions/pub/19/19-60394-CV0.pdf?ref=fdaweb.com) an FTC administrative hearing included testimony from 37 witnesses and over 1,200 exhibits. Based on that record, it says, FTC conducted a rule-of-reason analysis as required by the Supreme Court in *Actavis* and concluded unanimously that Impax violated antitrust law.

The decision says FTC brought separate actions against Endo and Impax alleging that their settlement was an unfair method of competition under the FTC Act and an unreasonable restraint on trade under the Sherman Act. Endo settled but Impax fought the charge and successfully argued that the case should proceed to an administrative proceeding rather than in federal district court, where FTC had first filed.

When an administrative law judge determined that the agreement restricted competition but still was lawful because its pro-competitive benefits outweighed the anticompetitive effects, the commission reviewed the facts and law and found that Impax had failed to show that the settlement had any pro-competitive benefit. It also held that the purported benefits Impax identified could have been achieved through a less restrictive agreement.

FTC did not impose any monetary sanctions, the appeals court says, and did not invalidate Impax’ agreements with Endo or other drug makers. But it issued a cease-and-desist order enjoining Impax from entering into similar reverse payment settlements going forward. It was that order that Impax asked the 5th Circuit to review.