A federal judge in California has partially reinstated California’s ban on most pay-for-delay deals, which occur when a drugmaker pays another company not to launch a generic competitor in order to maintain its monopoly.

Judge Troy Nunley in the U.S. District Court for the Eastern District of California allowed the prohibition on deals struck within California, but not on deals made outside the state.

In 2019, California became the first U.S. state to ban the practice. In December 2021, the judge issued an injunction temporarily halting pay-for-delay agreements between branded drug manufacturers and makers of generics in the state.