Note

Authorized Generics: A Prescription for Hatch-Waxman Reform

Authorized generics present the latest controversy in the perennial battle between pioneer and generic drug manufacturers. Under these arrangements, a pioneer firm will “authorize” a generic version of its brand-name drug to enter the market during another generic competitor’s 180-day exclusivity period. This practice has generated intense debate within the pharmaceutical industry regarding its potential impact on Paragraph IV patent challenges, in addition to the proper operation and intent of the Hatch-Waxman Act. Because of the immense economic and public health consequences at stake, and previous patterns of Hatch-Waxman abuse, the Federal Trade Commission has recently launched an investigation of authorized generics.

This Note explores the qualitative nature of pharmaceutical competition, specifically focusing on the interaction between pharmaceutical supply chain economics and consumer behavior. From these observations, I propose a theory of competitive harm and conclude that authorized generics are an anticompetitive strategic behavior which violate the antitrust laws by deterring Paragraph IV entry. I find normative support within the Hatch-Waxman and patent law regimes to corroborate my antitrust analysis. Finally, I recommend potential solutions to the authorized generics controversy, including Hatch-Waxman legislative reform.

How to Construe a Hybrid Statute

This Note addresses the interpretation of statutes creating civil and criminal liability with identical or nearly-identical language. It illustrates how, if conventional interpretive rules are applied, these “hybrid” statutes can receive a (problematic) path-dependent interpretation: the statute’s meaning will depend on whether an ambiguity first comes to light in a civil or criminal case. However, the most obvious solutions to this problem – applying lenity in all civil cases arising under hybrid statutes and dual construction of identical language – are unsatisfactory. Dual construction is seldom if ever appropriate, because of the descriptive force and normative attractiveness of the consistent usage canons. Moreover, an unthinking application of lenity in all civil cases would seriously impair the operation of many important statutes, and probably frustrate legislative expectations. Instead, this Note argues that language common to the civil and criminal portions of hybrid statutes should, presumptively, be construed both consistently and evenhandedly. In other words, glosses rendered civilly should apply criminally and vice-versa, and the mere existence of a certain level of ambiguity should not presumptively resolve the interpretive question either way.

The Principal Problem: Towards a More Limited Role for Fiduciary Law in the Nonprofit Sector

Nonprofit law scholars have increasingly recognized that state fiduciary law developed to govern for-profit corporations does not readily translate into the nonprofit sector. A substantial body of literature has sought to strengthen nonprofit governance by modifying for-profit fiduciary law to better fit the needs of the nonprofit sector. No one has answered, however, the fundamental question of to whom nonprofit boards and directors owe their fiduciary duties. Without understanding whose interests fiduciary law should protect, attempts to strengthen it are premature.

Directors and officers of for-profit corporations owe their duties to shareholders. Nonprofit corporations lack shareholders but could theoretically be accountable to donors, beneficiaries, customers, the state, or their charitable purpose. This Note argues that nonprofit corporations in fact have no appropriate principals, and thus fiduciary law is a poor governance mechanism for the nonprofit sector. The legal toolkit available to reform nonprofit governance is thus more limited than has been previously acknowledged. In the future, legal efforts to reform nonprofit governance should focus on creating targeted rules to address specific abuses and on creating conditions that allow market-based governance mechanisms to flourish.

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