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FDA Flunks Mylan’s India Facilities, Finds cGMP Violations

FDA Flunks Mylan’s India Facilities, Finds cGMP Violations

When we open our medicine cabinet, we take for granted that the drugs we find there are safe and properly labeled. Many physicians privately worry, however, about the safety and efficacy of prescription drugs.

About 85% of the prescription drugs sold in the United States are manufactured offshore. Many of those offshore drugs are made by generic companies, foreign contract manufacturing companies and sometimes, offshore facilities owned by the so-called “big pharma” manufacturers themselves. Wherever manufactured, drugs distributed in the United States must meet certain current good manufacturing practices or cGMP standards.

Recently the Food and Drug Administration (FDA) began ramping up inspections of offshore manufacturing facilities and the results are shocking. Although cGMP violations have been found worldwide, experts are particularly worried about drugs made in China and India.

Earlier this month the FDA cited three facilities in Bangalore, India that manufacture drugs for Mylan. Headquartered in the U.K., Mylan is the second largest generic and specialty pharmaceutical company in the world. With approximately 30,000 employees worldwide and revenues of $7.72 billion (USD), Mylan certainly qualifies as big pharma.

The FDA says it inspected three of Mylan’s Indian plants between August of 2014 and February of this year. It found “significant” cGMP violations at all three facilities.

Worse, the FDA says that in all three instances Mylan’s response to the three inspections lacked “sufficient corrective actions.”

cGMP standards are in place throughout the manufacturing process to insure the potency and quality of the finished pharmaceuticals. The FDA wants to insure that there are no contaminants in the finished product as well as insuring the finished product is neither stronger nor weaker than advertised.

As a result of the inspections, the FDA concluded a likelihood that the finished drugs from all three plants were adulterated. Those findings are certainly bad news for consumers. It’s also bad for physicians as well. It’s hard for doctors to get dosages correct or monitor for side effects if a drug has inconsistent potency or the presence of contaminants.

In the case of Mylan’s Bangalore, India facilities, the violations were numerous and included:

  • gloves and sterile gowns for use in aseptic environments had holes and tears

  • personal sanitation violations

  • clean room violations

  • discolored injection vials

  • lots with failed assays or contaminants

At least one of the facilities had similar violations dating back to a 2013 inspection.

Overall, the FDA noted, “These items found at three different sites, together with other deficiencies found by our investigators, raise questions about the ability of your current corporate quality system to achieve overall compliance with CGMP. Furthermore, several violations are recurrent and long-standing.”

The FDA declared that continued noncompliance could result in drugs from these facilities being blocked from importation and distribution within the United States.

Mylan has had previous problems with U.S. regulators. In 2000 Mylan paid a $147 million fine to settle charges that the company raised the price of generic lorazepam by 2,6000% and generic clorazepate by 3,200%. The FTC had charged that the company raised the price of lorazepam, the generic equivalent of the brand name antianxiety medication Ativan, from $7 per bottle to $190. Although Mylan agreed to the payment of the fine, it denied any wrongdoing.

Only the FDA can punish drug companies for cGMP violations but if there is proof of an adulterated product entering the commerce stream, the federal False Claims Act can come into play. That law allows private individuals to file a lawsuit against a wrongdoer and receive a percentage of whatever is recovered by the government. Last year the Justice Department paid $635 million in whistleblower awards under the False Claims Act.

Whistleblowers in cGMP cases have received tens of millions of dollars. Dinesh Thakur, a former Ranbaxy executive, received $48 million for information about adulterated generic drugs.

To qualify for a whistleblower award, one must possess inside, “original source” information about a cGMP violation resulting in an adulterated drug or under / over potency medication being approved for sale by Medicaid, Medicare or Tricare. (Most drugs are approved.)

While we believe that contaminated drugs are relatively rare, industry sources tell us that potency issues are rampant. That means the drugs in your medicine cabinet may have little or no active ingredients.

Article By Brian Mahany of Mahany Law

© Copyright 2015 Mahany Law

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Posted on August 25, 2015May 19, 2021Author National Law ForumCategories Antitrust & Trade Regulation, Drug & Cosmetic Law, Health Care LawTags cGMP, FDA, Manufacturing, prescription drugs

Making a Claim against a Payment Bond Posted by a General Contractor or Sub-Contractor

In construction projects that are performed either on behalf of a municipality or a state agency, a general contractor and potentially a sub-contractor are typically required to post payment and/or performance bonds with the county or municipality. A general contractor or sub-contractor is required to post a payment and/or performance bond, because this ensures that sub-contractors or suppliers are paid, and enables the Township or state agency to have the work completed should the contractor fail to do so in a timely fashion. As a supplier or sub-contractor on such a municipal or state project, it is important to know your rights with regard to making a claim against a payment bond.

The most important thing that any sub-contractor or supplier must do prior to providing materials or services for a public contract is to provide the proper notice as required by N.J.S.A. 2A.44-145. This strict notice requirement specifies that the sub-contractor or supplier notify the party who posted the payment bond for the project in writing via certified mail of their intent to provide materials or services for the project. This is a prerequisite to being able to make a claim against the bond, or to receive a payment for materials and services with regard to the project if they are not paid by the sub-contractor or general contractor. As such, it is very important that any sub-contractor or supplier provide the appropriate notice to the party that posted the bond prior to performing any work or providing any materials.

If proper notification has been sent and a sub-contractor or supplier did not receive payment for materials or services provided, they may make a claim against the bond posted by the general contractor or the sub-contractor. It is always suggested that a sub-contractor or supplier obtain a copy of the bond posted by the general contractor or sub-contractor before providing materials or services. This is to ensure that any claim against the bond is made in a timely manner and is not forfeited by failing to comply with the terms of the bond, which require that a claim be made within a certain specified period of time.

Assuming that you have complied with the time requirements of the bond, a sub-contractor or supplier would first send a Notice of Demand for Payment to the bonding company with a copy to the contractor who posted the bond. Typically, the bonding company will require the production of any and all documents which justify the payment sought by the claimant that was not tendered by the sub-contractor or general contractor. Upon receipt of this information, the bonding company will make a determination whether payment is due for the materials and services which were provided.

Article By Paul W. Norris of Stark & Stark

COPYRIGHT © 2015, STARK & STARK

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Posted on August 25, 2015May 19, 2021Author National Law ForumCategories Government ContractsTags contractors, government contractors, Subcontractors
Attend the 20th Annual Law Firm Leaders Forum Oct 8-9 in NYC – Brought to you by the Legal Executive Institute

Attend the 20th Annual Law Firm Leaders Forum Oct 8-9 in NYC – Brought to you by the Legal Executive Institute

When: OCT 08 – 09, 2015
Where: New York, NY – The Pierre

Join us this October as the Thomson Reuters Legal Executive Institute proudly presents the 20th Anniversary of Law Firm Leaders at The Pierre Hotel in Midtown Manhattan.

Continuing the forum’s unrivaled tradition of industry-defining content and professional networking, the 2015 program offers a comprehensive update on the state of the legal profession and the ongoing challenges affecting law firm leadership throughout the AmLaw 150.

This year’s key topics include:

  • Restoring Professionalism to the Practice of Law
  • Leading Change: A Presentation from Heidi Gardner, Lecturer on Law & Distinguished Fellow, Center on the Legal Profession, Harvard Law School
  • The Meaning of Client Relationships in the 21st Century
  • Data Privacy & Cybersecurity in the Global Law Firm

Call to register: 1-800-308-1700

Or click here to email and we will contact you.

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Posted on August 24, 2015May 19, 2021Author National Law ForumCategories Conferences, Law Office Management, Legal CLE, Legal Networking, Legal NewsTags law firm, law office management, Legal Events, Legal News
Ever Evolving L-1B Adjudication Standards

Ever Evolving L-1B Adjudication Standards

Immigration law practitioners have been receiving Requests for Evidence (RFEs) on most L-1B (Intracompany Transferee-Specialized Knowledge) petitions for new issuance as well as L-1B renewals. These RFEs, requiring burdensome responses, in fact may misinterpret the term “specialized knowledge.”

  • In March, 2015 USCIS, in an effort to clarify adjudication standards, issued a draft L-1B Adjudication Policy Memorandum (PM-602-0111), soliciting comments from the public as well as stakeholders.

  • On July 17, 2015, USCIS issued a Request for Comments on Draft RFE Template for Form I-129 involving L-1B Intracompany Transferees-Specialized Knowledge.

  • On August 17, 2015, the final policy memorandum was published.

So how could an RFE template be proposed when an interpretive memorandum on which it is based has not been published in its final form? Moreover, has USCIS even considered the comments it solicited on the Draft Memorandum and Draft RFE Template in these proceedings?

The Draft RFE Template appears to be based upon language in the draft (now final) memorandum which was still the subject of considerable comment from stakeholders when the Draft RFE Template was issued. All of this leads to more confusion, ambiguity, and uncertainty in the application process. This also gives rise to a need for burdensome and generally unnecessary documentation at the initial filing in response to an RFE, or both.

The L-1 saga will continue.

Article By Gary A. Pappas of Jackson Lewis P.C.

Jackson Lewis P.C. © 2015

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Posted on August 24, 2015May 19, 2021Author National Law ForumCategories ImmigrationTags Immigration, Immigration Law, L-1B visa, visa
Medical Record Retention

Medical Record Retention

I am often asked how long a practice must maintain medical records. The answer depends on the type of provider you are and your risk tolerance. Providers should generally consider the following in establishing their record retention policies:

1. Patient care. The primary consideration should be patient care. Some practices (e.g., oncology) may want to retain medical records longer than the relevant regulatory requirement or statute of limitations period because the records may be important to future patient care. If your electronic records program allows, you may want to retain the records permanently.

2. Statutory or Regulatory Requirements. State and federal regulations require hospitals and certain other institutional providers to maintain medical records for specified periods, but those laws usually do not apply directly to physicians or physician groups. There are numerous guides online. For example, HealthIT.gov published a 50-state survey of record retention requirements. The Idaho Department of Health and Welfare published a helpful but incomplete summary of federal record retention regulations. CMS published a MedLearn article on recordretention. AHIMA is usually a good source for online guidance about record retention laws and regulations.

3. Accreditation, payer or other contract requirements. Some provider contracts, payer requirements, or accreditation standards may require providers to keep records for a certain time. For example, Idaho’s Medicaid Provider Handbook requires providers to maintain records to support claims for five years. Check your relevant contracts to ensure your record retention policies comply with any such requirements. You may also want to check with your liability insurer to determine if they have any record retention requirements or suggestions.

4. Statute of limitations. If there are no more paramount concerns, physicians should generally retain medical records for at least the applicable statute of limitations period to ensure the practice has the records necessary to defend its care or charges if challenged. In most cases, maintaining the records for ten (10) years should get you past relevant state or federal limitations periods, including those for malpractice, contract, or fraud and abuse claims. Beware that many states toll the statute of limitations period for claims by minors; if so, you may want to keep records of minors until the later of either (i) six years after the date of treatment, or (ii) three years after the minor reaches the age of majority, depending on your applicable state statute of limitations for malpractice claims.

If your records are subject to a pending claim or investigation, you should retain the records through the resolution of the claim or investigation. Destroying records that are subject to pending claims or investigations may result in liability under state or federal laws; common law claims for destruction of evidence; or adverse judgments because you lack the evidence to defend yourself.

ARTICLE BY Kim C. Stanger of Holland & Hart LLP

Copyright Holland & Hart LLP 1995-2015.

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Posted on August 24, 2015May 19, 2021Author National Law ForumCategories Health Care LawTags Health Law
Contract Corner: Key Considerations in Understanding and Negotiating IT Agreements

Contract Corner: Key Considerations in Understanding and Negotiating IT Agreements

When entering into IT agreements with vendors, it is important to understand the type of agreement being negotiated, the services being provided, and who will be using the services within your organization. The category of “IT agreements” generally includes cloud application agreements, service agreements, installed applications, and online presence management. When negotiating IT agreements, the legal team should work closely with the business and IT teams to ensure that the correct level of importance is placed on the agreement and that provisions are added or revised in a way that clarifies the parties’ responsibilities in connection with the services being provided and also addresses the potential unwinding of the relationship. To provide maximum clarity and flexibility in connection with purchased IT services, consider the following key provisions when negotiating IT agreements:

  • Performance Standards (or “teeth”)

    Performance standards are critically important, but it is difficult to know where standards should be set and what services are most critical without consulting with your IT group. The IT group can help determine how critical the services are and build appropriate performance standards around the applicable services. Types of performance standards include quality assurance, service levels and credits (which often include measurement and monitoring and notice of performance issues), and customer satisfaction surveys.

  • Term

    Consider the benefits versus the risks of including a long multiyear initial term and automatic renewal terms. Vendors love a long term and often offer pricing concessions to lock in long terms, but a long term can significantly increase risk to the customer if the relationship goes south. Some companies prefer automatic renewal because there is less paperwork, but others view automatic renewal as another milestone that needs to be managed and a potential risk if the relationship with the vendor is strained.

  • Termination and Termination Assistance

    Consider including a termination for convenience clause. Termination for convenience provides an easier mechanism for unwinding a deal when a vendor is not knocking it out of the park, especially if the vendor’s obligations are not clear. Customers should also strongly consider negotiating for termination assistance services to further mitigate the risks associated with unwinding an unsatisfactory deal. If the IT services include storage or processing of customer data, termination assistance provisions should include return and migration of customer data and require the current vendor to cooperate with the new vendor. Specific disengagement plans can be negotiated up front if necessary.

  • Data Protection

    Language should be added to protect all data provided in connection with the use of the services. This language can include security obligations (remember, this is not insurance), obligations to mitigate or cover the costs associated with data breaches, a duty to notify, and rights to audit and review security representations.

  • Proprietary Rights

    If proprietary rights are important to the agreement—for instance, if a vendor is developing new technology or using important customer technology—make sure that the contractual language around proprietary rights clearly states who owns the core technology and any improvements, interfacing elements, and data.

  • Cyber-Liability Insurance

    Add provisions that require the vendor to maintain adequate cyber-liability insurance, especially if the vendor is storing or processing customer data.

  • Representations and Warranties

    Consider adding situational representations and warranties (e.g., PCI compliance or EU Data Privacy compliance) applicable to particular services being provided, in addition to standard representations and warranties for IT agreements, such as conformance with specifications. For each representation and warranty, consider the remedy that should apply in the event that it is breached.

  • Indemnification

    The vendor should agree, at minimum, to indemnify the customer for third-party claims related to the services being provided.

  • Limitation of Liability

    If the vendor negotiates for a limitation of liability provision, make sure appropriate exclusions for confidentiality, data breach, and indemnification are negotiated. It is also important for these exclusions to be carved out of standard limitations on indirect, special, and consequential damages, because many of the losses associated with confidentiality, data breaches, and indemnification claims might otherwise be barred by such provisions.

ARTICLE BY Emily R. Lowe & Glen W. Rectenwald of Morgan, Lewis & Bockius LLP

Copyright © 2015 by Morgan, Lewis & Bockius LLP. All Rights Reserved.

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Posted on August 23, 2015May 19, 2021Author National Law ForumCategories ContractsTags Contracts, IT
Uber Ordered to Buckle Up for Litigation: Taxicab Plaintiffs Ride out (in part) Uber’s Motion to Dismiss False Advertising Claims

Uber Ordered to Buckle Up for Litigation: Taxicab Plaintiffs Ride out (in part) Uber’s Motion to Dismiss False Advertising Claims

A group of California taxicab companies sued Uber in federal court in San Francisco for falsely advertising the safety of Uber rides and for disparaging the safety of taxi rides. Uber moved to dismiss plaintiffs’ Lanham Actclaim, contending that the safety-related statements were non-actionable puffery and were not disseminated in a commercial context. Uber also moved to dismiss plaintiffs’ California unfair competition law (“UCL”) claim for lack of standing, and moved to strike plaintiffs’ request for restitution under the UCL and California’s false advertising law (“FAL”).

Declining to put the brakes on the lawsuit in its entirety, the court granted in part and denied in part Uber’s motion. L.A. Taxi Cooperative, Inc. v. Uber Technologies, Inc., 2015 WL 4397706 (N.D. Cal. July 17, 2015).

The court agreed that some of Uber’s statements were non-actionable puffery. For example, Uber’s claim that it was “GOING THE DISTANCE TO PUT PEOPLE FIRST” was “clearly the type of ‘exaggerated advertising’ slogans upon which consumers would not reasonably rely.” It would be impossible to measure whether or how Uber was fulfilling this promise. Likewise, Uber’s statement “BACKGROUND CHECKS YOU CAN TRUST” was puffery because it made no specific claim about Uber’s services. The court therefore dismissed plaintiffs’ claims as to these non-actionable statements.

On the other hand, the court did not agree that Uber was merely puffing when it claimed it was “setting the strictest safety standard possible,” that its safety is “already best in class,” that its “three-step screening” background check process adheres to a “comprehensive and new industry standard,” or when Uber compared its background check process to the taxi industry’s background check process. These statements were not puffery because “[a] reasonable consumer reading these statements in the context of Uber’s advertising campaign could conclude that an Uber ride is objectively and measurably safer than a ride provided by a taxi . . . .”

The court also rejected Uber’s argument that, because certain advertising claims were preceded by phrases like “Uber is committed to” or “Uber works hard to” – for example, “We are committed to improving the already best in class safety and accountability of the Uber platform . . .” – that the advertising claims were merely aspirational and therefore non-actionable. The challenged statements did more than assert that Uber was committed to safety, the court found; they included statements regarding the objective safety and accountability of Uber’s service. A reasonable consumer might rely on such statements, so the court denied Uber’s motion to dismiss in this regard.

The court found that certain advertising statements Uber made to the media were non-commercial speech and therefore not actionable under the Lanham Act or California state law. These statements were made in response to journalists’ inquiries, and were “inextricably intertwined” with the journalists’ independent – and largely critical – coverage of Uber’s safety record, which was a matter of public concern. Accordingly, the court granted Uber’s motion and dismissed plaintiffs’ claims relating to these non-actionable statements.

But the court did find Uber’s statements on ride receipts to be commercial speech. Following a completed ride, Uber emails its customers a receipt that includes a $1.00 “Safe Rides Fee.” Uber explains to customers who click on a link in the receipt that the fee was intended “to ensure the safest possible platform for Uber riders,” that Uber would put the fee towards its “continued efforts to ensure the safest possible platform,” and that “you’ll see this as a separate line item on every uberX receipt.” Uber contended that such statements related to a past transaction, rather than a prospective transaction that Uber sought to induce, and therefore did not amount to commercial speech. The court disagreed, finding that “the complaint adequately allege[d] that the statements relating to the ‘Safe Rides Fee’ [were] made for the purpose of influencing consumers to use Uber’s services again.”

On the California UCL claim, the court found that the taxicab plaintiffs lacked standing because they did not allege that they relied on Uber’s allegedly false or misleading advertising. In dismissing this claim, the court explained that it was declining to join the minority of California federal courts that have permitted UCL claims to proceed where the plaintiff pled potential consumers’ reliance rather than the plaintiff’s own reliance.

Finally, the court found that plaintiffs did not have a viable claim for restitution under California’s UCL and FAL because that remedy is limited to “money or property that defendants took directly from [a] plaintiff” or “in which [a plaintiff] has a vested interest,” and the complaint failed to allege that plaintiffs had an ownership interest in Uber’s profits that they sought to disgorge.

ARTICLE BY Lawrence I Weinstein & Jeffrey H Warshafsky of Proskauer Rose LLP

© 2015 Proskauer Rose LLP.

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Posted on August 22, 2015May 19, 2021Author National Law ForumCategories Antitrust & Trade RegulationTags false advertising, taxi, Uber, Unfair competition

It’s 2015: Do You Know Where Your Workplace Is? [VIDEO]

Where, when, and how we work has changed profoundly since I started practicing law but employment and privacy laws have not evolved to keep up with technological change and the reality of the “everywhere” workplace.

I would like to think that employment lawyers can provide some practical solutions to addressing policies that help draw the line between personal and business and yet protect valuable business assets.

Social media policies, integrating multi-jurisdictional privacy and employment laws, the gig economy … all of these developments are impacted by rapid technological change but legal developments have lagged.

Just think about the last “non-traditional” place you worked. In line at the grocery store? In your car? Where is your workplace?

ARTICLE BY Jennifer B. Rubin of Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.
©1994-2015 Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. All Rights Reserved.

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Posted on August 21, 2015May 19, 2021Author National Law ForumCategories Labor & EmploymentTags employment, work from home, Workplace

Unlucky 13: FTC Settles Charges under International Safe Harbor Framework

Thirteen companies have agreed to settle with the Federal Trade Commission (FTC) charges relating to their participation in the U.S.–EU and U.S.–Swiss Safe Harbor Frameworks. Seven companies allegedly failed to renew their Safe Harbor self-certifications, including a sports marketing firm, two software developers, a research organization, a business information firm, a security consulting firm, and an e-discovery service provider. Another six allegedly failed to seek certification under the Frameworks, but nevertheless claimed in their privacy policies to be certified, including an amusement park, two sporting companies, a medical waste service provider, a food manufacturer, and an e-mail marketing firm. Last year, fourteen companies settled with the FTC over similar claims, and advocacy group named 30 companies in a complaint alleging that they were out of compliance with the Safe Harbor Frameworks.

The European Commission’s Directive on Data Protection prohibits the transfer of personal data to non-EU countries that do not meet the EU standard for privacy protection, so the U.S. Department of Commerce (DOC) negotiated the Safe Harbor Frameworks to allow U.S entities to receive such data provided that they comply with the Directive. To participate in the Safe Harbor Frameworks, companies must annually self-certify that they comply with seven key privacy principles for meeting EU’s adequacy standard: notice, choice, onward transfer, security, data integrity, access, and enforcement. Only appropriately self-certified companies may display the Safe Harbor certification mark on their websites, and the FTC is charged with enforcing violations.

This enforcement action is a reminder of the importance of maintaining current Safe Harbor status for those who elect to participate the program. It is also a reminder that companies must act in accordance with their published privacy policies, and periodically review their privacy policies to ensure that they remain current and reflect companies’ actual practices.

ARTICLE BY Sheila A. Millar, Tracy P. Marshall & Nathan A. Cardon of Keller and Heckman LLP

© 2015 Keller and Heckman LLP

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Posted on August 20, 2015May 19, 2021Author National Law ForumCategories Antitrust & Trade RegulationTags data protection, European Commission, FTC, safe harbor
Amarin Ruling Solidifies Off-Label Marketing Options but Raises Questions About False Claims Act Enforcement Action

Amarin Ruling Solidifies Off-Label Marketing Options but Raises Questions About False Claims Act Enforcement Action

The Southern District of New York recently ruled in Amarin Pharma, Inc. et al. v. Food and Drug Administration, et al. that a drug company may engage in “truthful and non-misleading speech” about off-label uses of an approved drug without the threat of a misbranding action under the Federal Food, Drug, and Cosmetic Act. No. 1:15-cv-03588 (S.D.N.Y., Aug. 7, 2015). This important decision—which arose out of Amarin’s constitutional challenge seeking to make certain statements about unapproved uses of a triglyceride-lowering drug, Vascepa—builds on recent Second Circuit precedent that allows drug makers more regulatory latitude, at minimum in the Second Circuit, to provide truthful and non-misleading scientific information about unapproved uses for their products. However, the ruling also serves as a reminder of potential False Claims Act (FCA) liability associated with off-label marketing of pharmaceuticals and devices.

Amarin filed its complaint against the Food and Drug Administration (FDA) after the company received a Complete Response Letter (CRL) from the FDA in connection with its application for approval of a new indication. The CRL indicated that, while clinical studies revealed that Vascepa reduced triglyceride levels, based on its data review, the FDA advised that additional clinical data would be needed before it could approve the drug for additional uses beyond the original approval for “very” high levels of triglycerides. Despite the fact that Amarin sought to make truthful and non-misleading statements about its product to “sophisticated healthcare professionals,” including the physicians who joined Amarin in the lawsuit, the FDA concluded there was insufficient support for approval of the supplemental application for a new indication and stated that any communications about off-label uses of Vascepa could result in enforcement action.

While the FDA described Amarin’s First Amendment claims as a “frontal assault on the framework for new drug approval that Congress created in 1962,” the court rejected all of the government’s counterarguments. Relying on the Second Circuit’s decision in United States v. Caronia, 703 F.3d 149 (2d Cir. 2012), the court held that Amarin could engage in the following activity:

  • Distribute summaries and reprints of the relevant studies in a manner or format other than that specified by the FDA

  • Articulate, in connection with Vascepa, the off-label claim permissible for use on chemically similar dietary supplements

  • Make proactive truthful statements and engage in a dialogue with doctors regarding the off-label use

While the Amarin decision is welcome news for the industry, drug manufacturers must still take care to analyze promotional statements to ensure that the content can be successfully defended as “truthful” and “non-misleading” speech. As the Amarin court acknowledged, manufacturers not only face potential criminal exposure for “false” or “misleading” misbranding, but the promotion of off-label use can give rise to civil claims under the FCA. FCA enforcement in off-label cases—which proceed on a theory that a company caused false claims to be submitted to government health care programs for non-covered and non-FDA-approved uses—have been a huge source of FCA recoveries in recent years. In FY2014, for example, the Department of Justice (DOJ) recovered over $2.2 billion in FCA actions against pharmaceutical and medical device companies stemming from off-label promotion. Regulatory enforcers and qui tam whistleblowers will not hesitate to allege FCA violations where circumstances, for example, allow the inference that narrowly couched promotional statements may have been “truthful” but still factually incomplete and, thus, misleading. The Amarin decision highlights the fact-specific nature of the risk analysis. Amarin relied on truthful statements about Vascepa’s off-label use that were largely derived from an FDA-approved study and writings from the FDA itself on the subject. Rather than shooting from the marketing “hip,” Amarin appears to have invested in building a defensible factual scientific record and preemptively sought an FDA opinion regarding the off-label use of Vascepa before engaging in those communications.

While it remains unclear whether the FDA will appeal the Amarin decision to the Second Circuit, the agency’s decision to let Caronia stand without further appeal suggests that there may be reluctance on the part of regulators to risk a higher court expanding the reach of the Caronia holding across the country. Pharmaceutical and device manufacturers should still proceed cautiously as the FDA determines how it will respond following the Amarin ruling. For example, the FDA updated its draft guidance regarding the dissemination of scientific and medical journal articles following the Caronia decision in February 2014 and agreed in June 2014 to conduct a “comprehensive review [of its] regulatory regime governing communications about medical products,” with the intent of issuing new guidance by June 2015. As the Amarin court noted, this revised guidance is still forthcoming and may be further revised in light of this decision.

ARTICLE BY T. Reed Stephens & Amandeep S. Sidhu of McDermott Will & Emery

© 2015 McDermott Will & Emery

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Posted on August 20, 2015May 19, 2021Author National Law ForumCategories FDA, Health Care LawTags amarin, False Claims Act, FDA

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