Anti-competition is an important article in your Licenses (I already start at the Term Sheet level). For those of you who have come to my courses, you know that I emphasise that this article is to be read in conjunction with definition of Compounds, Products, Warranties, License rights etc...

The whole point is that you do not want your partner to be directly competing with your product when your product still has a good life span. You get only a small fraction of the profits,usually in royalties (yes, it is fair, since your partner presumably has taken the risk and paid the lion's share of the development costs and likely came up with a regulatory, clinical and marketing strategy as well). Still-they have 'riden' on your asset and they should give it a decent run in the marketplace..and be sensitive to your business,right? When will your next product come along!?

An exception I do make is when the competing product has an indeniably superior efficacy or side-effect profile, then it would be unethical that your partner does not bring it out to benefit the patients - at the end of the day, our ultimate aim here is to progress therapeutics and to cure diseases.

Amylin Pharmaceuticals is in a legal battle with long-time Byetta partner Eli Lilly, who plans to promote a rival diabetes drug with Boehringer Ingelheim. There is no doubt that Amylin is still in business today, thanks to its Lilly partnership.

Amylin filed a lawsuit against Lilly, claiming its link-up with Boehringer is unlawful and breaches pacts covering Byetta (eventide) and its once-weekly version Bydureon. In January, Lilly signed a wide-ranging diabetes collaboration, one of the key elements being the oral dipeptidyl peptidase-4 inhibitor Tradjenta (linagliptin), which was approved in the USA earlier this month.

Amylin alleges that Lilly is engaging in "improper, unlawful and anticompetitive behaviour" as linagliptin will compete directly with the eventide products. Now a California court has issued a temporary restraining order (TRO) against Lilly, preventing it from proceeding with plans to use the same sales force to sell both exenatide and linagliptin.

Why do we, in pharma get into such situations? Why couldn't we have saved legal headaches and huge fees by :

1) Better communications and transparency at Alliance Management

2) Better top level (CEO) communications and relationships

3) Being attentive to the anti-competition clause and perhaps renegotiated it?

Again, Amylin and Lilly may have done all that and still decided to support the legal profession !