Reverse Payment Agreement for Hong Kong

Reverse Payment Agreement Template for Hong Kong

A Hong Kong-governed agreement that settles patent disputes between pharmaceutical patent holders and generic manufacturers, where the patent holder provides compensation to the generic manufacturer in exchange for delayed market entry. The agreement must comply with Hong Kong's Competition Ordinance and Patents Ordinance, requiring careful consideration of competition law implications while protecting legitimate intellectual property rights. The document includes detailed provisions on payment terms, entry dates, and competition law compliance mechanisms, structured within Hong Kong's unique legal framework that combines common law principles with specific local regulations.

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What is a Reverse Payment Agreement?

The Reverse Payment Agreement serves as a settlement mechanism in pharmaceutical patent disputes under Hong Kong law, typically used when a patent holder wishes to resolve potential patent litigation with a generic manufacturer. This document type has gained significance following the implementation of Hong Kong's Competition Ordinance, which scrutinizes such arrangements for potential anti-competitive effects. The agreement must balance legitimate patent rights protection with competition law compliance, incorporating specific provisions on payment structures, market entry timing, and regulatory compliance. It's particularly relevant in Hong Kong's evolving pharmaceutical market, where increasing generic competition intersects with strong intellectual property protection frameworks. The document requires careful drafting to ensure enforceability while managing competition law risks under Hong Kong's hybrid legal system that combines common law traditions with local statutory requirements.

What sections should be included in a Reverse Payment Agreement?

1. Parties: Identification of the patent holder and generic manufacturer, including registered addresses and company details

2. Background: Context of the patent dispute, reference to relevant patents, and basis for settlement

3. Definitions: Key terms including Patent Rights, Licensed Products, Entry Date, Territory, and other technical/commercial terms

4. Settlement Terms: Core settlement provisions resolving the patent dispute

5. Payment Provisions: Details of reverse payments, including amount, timing, and any conditions

6. Market Entry Provisions: Specific terms regarding delayed market entry, including exact date and conditions

7. Competition Law Compliance: Provisions ensuring compliance with competition laws and legitimate business justifications

8. Representations and Warranties: Standard and specific warranties regarding patent validity, generic capabilities, and compliance

9. Confidentiality: Provisions governing confidential information exchange and protection

10. Term and Termination: Duration of the agreement and circumstances for early termination

11. General Provisions: Standard boilerplate including governing law, jurisdiction, entire agreement, etc.

What sections are optional to include in a Reverse Payment Agreement?

1. Supply Arrangements: Include when the agreement involves supply of authorized generic products during or after the delay period

2. Technology Transfer: Include when technical information or know-how transfer is part of the settlement

3. Regulatory Compliance: Include when specific regulatory filings or approvals are required

4. Alternative Dispute Resolution: Include when parties prefer specific dispute resolution mechanisms beyond court litigation

5. Marketing and Promotion: Include when the agreement covers marketing arrangements post entry

6. Patent Challenge Provisions: Include when addressing future patent challenges is necessary

What schedules should be included in a Reverse Payment Agreement?

1. Patent Schedule: Details of relevant patents including patent numbers, jurisdictions, and expiry dates

2. Product Specifications: Technical specifications of the generic products covered by the agreement

3. Payment Schedule: Detailed breakdown of payment amounts, timing, and any adjustment mechanisms

4. Competition Law Analysis: Documentation of competition law assessment and justifications

5. Form of Notice: Template notices for key communications under the agreement

6. Territory Details: Specific geographical areas covered by the agreement and any territorial restrictions

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Hong Kong

Publisher

Genie AI

Document Type

Purchase Agreement

Cost

Free to use
Relevant legal definitions
Clauses
Relevant Industries

Pharmaceuticals

Biotechnology

Healthcare

Chemical Manufacturing

Life Sciences

Medical Devices

Research & Development

Relevant Teams

Legal

Intellectual Property

Regulatory Affairs

Commercial

Business Development

Finance

Compliance

Research & Development

Executive Leadership

Corporate Strategy

Relevant Roles

Chief Legal Officer

Head of Intellectual Property

Competition Law Counsel

Patent Attorney

Commercial Director

Chief Executive Officer

Head of Regulatory Affairs

Business Development Director

Chief Financial Officer

General Counsel

Senior Legal Counsel

Licensing Manager

Head of Research & Development

Compliance Officer

Industries
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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