Don’t have a subscription yet? Subscribe Here ?rid=m4O2wt.
October 2020
Issue Summary:
For October, our focus is on drug pricing, which is a continuing focus of ongoing enforcement and the health care debate. For starters, our feature article examines the continuing generic price-fixing investigation and Teva’s the recent indictment. Next, we delve into recent subpoena AbbVie received from the House Oversight Committee as part of their ongoing investigation. Shifting gears slightly, we examine the recent setback the Trump Administration and HHS suffered attempting to mandate price disclosures in DTC TV advertisements.
On the litigation front, we discuss Pfizer’s case seeking relief from its CIA and the OIG Advisory Opinions as the company attempts to work with independent copay charities. We also examine Johnson and Johnson’s use of the COVID-19 pandemic to avoid the ongoing talcum powder litigation.
Rounding out the issue, we turn to Governance and Operations and the next installment of our multi-part series on digital transformation and the tele-compliance ecosystem. Part 3 of the series focuses on compliance education and communication.
Playing High Stakes Poker
Teva Loses and Is Indicted for Price Fixing
By Kirt Kraeuter, Staff Writer
Summary: The U.S. Department of Justice has upped the stakes in the criminal price-fixing matters plaguing the generic pharmaceutical industry. On the heels of the recently announced deferred prosecution agreements comes a superseding criminal indictment broadening the alleged conspiracy by Glenmark to restrain trade through price-fixing agreements to include the largest generic manufacturer, Teva. Simultaneously, the three related civil matters continue to advance.
Sending a Message to Drug Makers
Congress Subpoenas AbbVie for Drug Pricing Documents
By Gwendolyn A. Ball, Staff Writer and Dr. Seth B. Whitelaw, Editor
Summary: Since the beginning of 2019, the House Committee on Oversight and Reform has investigated the factors causing the rapid growth in prescription drug prices. As part of its investigation, it has requested documents on pricing strategies from twelve pharmaceutical companies. But one company, AbbVie, has not made a serious effort to reply with the request, supplying primarily marketing information. AbbVie’s reputation of one of the most aggressive users of intellectual property law to protect its market dominance, combined with its intransigence in complying with the investigation, has led the committee to take the unusual step of issuing a subpoena to gain the requested information. This action signals that, while Congress may not be moving forward on drug pricing legislation until after the election, it has not forgotten the critical issue of prescription drug pricing.
A Setback for Drug Pricing Transparency
The Legal Debate on Disclosures in TV Ads Continues
By Robert N. Wilkey, Senior Staff Writer
Summary: In June 2020, the Court of Appeals for the District of Columbia handed HHS and the Trump administration a setback to their efforts to require pharmaceutical manufacturers to disclose the “list price” of their products in television ads. While the Court held that HHS lacked authority to issue this rule, the opinion did not firmly establish the boundaries of the Department’s overall authority to address drug pricing. Therefore, this area will continue to remain highly debated and litigated.
Pfizer Seeks A “Do-Over” On Copay Foundation Issues
New Complaint For Declaratory Judgment Raises Legal, Procedural, and Constitutional Issues
By Craig B. Bleifer
Summary: Pfizer entered a settlement with the DOJ and a five-year CIA regarding its relationship with copay foundations in May 2018. Just 13 months later, Pfizer asked OIG if it could fund another copay foundation and offer direct copay assistance so that Medicare patients can afford another of its more expensive drugs. OIG was not favorably inclined. Pfizer’s recently filed Complaint for Declaratory Judgment makes new legal, procedural, and Constitutional arguments to convince the Court to allow its program to move forward. Whether this “do-over” is a winning legal strategy remains to be seen.
Blaming the Pandemic to Avoid High-Risk Litigation
J&J Employs a Novel Approach in the Talcum Powder Cases
By Robert N. Wilkey, Senior Staff Writer
Summary: In May 2020, Johnson & Johnson, citing the impact of the current pandemic, announced plans to discontinue the company’s talc-based Johnson’s Baby Power© in the U.S. and Canada, citing COVID-19 related issues. However, J&J also is facing thousands of cases claiming that long-term use of the product is responsible for causing ovarian cancer. Regardless of whether J&J’s strategy ultimately works, the decision represents a novel use of the pandemic as a justification to improve a company’s position in high-risk litigation.
The Tele-Compliance Ecosystem (Part 3)
Effective Compliance Education & Communication
By Michael R. Clarke, CCEP., Jenny M. McVey, Ph.D., and Michael Jelen
Summary: This article continues the discussion about digitally transforming data to allow for increased efficiency and remote capabilities in current compliance programs. One critical success factor of an effective compliance program is effective compliance education. On the heels of the DOJ’s updated guidance on evaluating a compliance program, we continue the discussion around reevaluating how compliance education is delivered and how to gauge effectiveness.