Arnall Golden Gregory LLP's Food and Drug Newsletter is a monthly update of legal and regulatory issues that affect the FDA-regulated community, including regular updates on legislative initiatives from AGG’s Washington, DC office, and articles from members of AGG outside the Food and Drug Practice.

In this Issue

• Happy Holidays from FDA: The Agency Issues Four Enforcement Letters for Unlawful Promotion
• Expanded Requirements for Expanded Access: The 21st Century Cures Act Imposes New Requirements on Manufacturers and Distributors
• Price Fixing Charges Brought Against Generic Drug Companies and Former Executives
• Expansion of the Humanitarian Use Device Program under the 21st Century Cures Act
• HIPAA Breach? Notify Promptly or Face Significant Potential Fines from HHS OCR
• Hot Topics in International Arbitration for 2017: Third-Party Funding
• DOJ and SEC Close Out 2016 with a Near $520 Million FCPA Settlement
• Industry Activities and Recognition
• Upcoming Events

PHARMACEUTICALS

Happy Holidays from FDA: The Agency Issues Four Enforcement Letters for Unlawful Promotion
By: Alan G. Minsk

The Food and Drug Administration recently issued holiday gifts, in the form of enforcement letters, to four pharmaceutical companies. The letters are reminders that FDA is not in a partying mood when it comes to unlawful promotion. More >

Expanded Requirements for Expanded Access: The 21st Century Cures Act Imposes New Requirements on Manufacturers and Distributors
By: Alan G. Minsk and Alexander B. Foster

The 21st Century Cures Act (Cures Act) makes a number of changes affecting the pharmaceutical and biologics industries, and AGG previously has written on some of these changes. This update will focus on how the Cures Act impacts expanded access, also known as compassionate use. The legislation defines expanded access/compassionate use as "the use outside of a clinical trial of an investigational medical product," because either there are no ongoing clinical trials of such product or a patient is not eligible for such a trial. The Cures Act contains specific policy publicity and content requirements for pharmaceutical and biologics companies so their expanded access programs are more accessible and transparent to potential patients. The expanded access/compassionate use requirements are at §3032 of the Cures Act, amending 21 U.S.C. §360bbb. More >

Price Fixing Charges Brought Against Generic Drug Companies and Former Executives
By: Jeffrey S. Jacobovitz and Bradford J. Kelley

Generic drug manufacturers have come under increasing scrutiny recently from state and federal regulators for price increases and alleged price collusion. Over the past year, drug pricing has faced sharp criticism from lawmakers, with executives from major pharmaceutical companies called before Congress to explain significant price hikes, most notably involving the EpiPen and Martin Shkreli controversies. Against this backdrop, last month the attorneys general in 20 states brought a civil action against six generic pharmaceutical companies for a scheme related to generic-drug price manipulation. On a related front, the Department of Justice brought criminal charges against two former Heritage Pharmaceuticals executives for conspiring to fix prices, rig bids, and allocate customers for two generic drugs. According to the filing, federal prosecutors allege that the executives aimed to fix prices on an antibiotic (doxycycline hyclate) and a diabetes medication (glyburide) between 2013 and 2015. In a public statement, Deputy Assistant Attorney General Brent Snyder of the Department of Justice’s antitrust division described the charges as an important step “in ensuring that generic pharmaceutical companies compete vigorously to provide these essential products at a price set by the market, not by collusion.” The Department has indicated in public statements that there are other companies and individuals involved in the price fixing scheme. More >

MEDICAL DEVICES

Expansion of the Humanitarian Use Device Program under the 21st Century Cures Act
By: Alan G. Minsk and Kalie E. Richardson

The 21st Century Cures Act, signed into law in December 2016, ushered in a number of changes that will affect the Food and Drug Administration’s product development programs. One such example relates to the expansion of the FDA’s Humanitarian Use Device Program (HUD Program). More >

NEWS FROM WASHINGTON

HIPAA Breach? Notify Promptly or Face Significant Potential Fines from HHS OCR
By: Kevin Coy

On January 9, 2017, the Department of Health and Human Services Office of Civil Rights (HHS OCR), which enforces the privacy requirements contained in Health Insurance Portability and Accountability Act (HIPAA), announced a first-of-its-kind penalty against a covered entity that failed to provide breach notification in a timely manner. This enforcement action should inform life sciences companies as to how they must address breaches affecting protected health information. Presence Health—an Illinois not-for-profit healthcare network with roughly 150 locations including hospitals, long-term care, and senior living facilities—agreed to pay $475,000 and implement policy changes to settle HHS OCR allegations that the company failed to provide timely notice to affected individuals, HHS OCR, and the media. More >

Hot Topics in International Arbitration for 2017: Third-Party Funding
By: Gene M. Burd

Intellectual property often is the most valuable asset of a growing life sciences company, and when IP becomes the subject of a dispute, companies may lack the means to protect their rights which, in turn, could adversely impact the company’s development. In such a situation, third-party funding could be of assistance. This article will review ways life sciences companies could leverage third-party funding in connection with international arbitration. Third-party funding has grown in the last few years in many jurisdictions, including U.S., UK, EU, and Asia. The interest for such financing comes from the parties requiring funding to pursue sizable claims as well as from funders. For bet-the-company claims involving complex IP, third-party funding is a must-consider option for life sciences companies to consider in connection with international arbitration in 2017. More >

DOJ and SEC Close Out 2016 with a Near $520 Million FCPA Settlement
By: Michael E. Burke and Kalie E. Richardson

The Securities and Exchange Commission (SEC) and Department of Justice (DOJ) wrapped up 2016 on December 22 with a near record-breaking Foreign Corrupt Practices Act (FCPA) settlement involving Teva Pharmaceuticals and its foreign subsidiaries. The settlement includes a $283 million payment to the DOJ to settle criminal bribery charges and a a separate payment of $236 million to the SEC in disgorged profits plus interest. At a total of over $519 million, this settlement is the fourth largest in FCPA history. More >

Four Members of the Healthcare Group Elected Partner

The AGG Healthcare Practice Group is proud to announce that four of its team members were recently elected to partnership in the firm. Congratulations to Lanchi N. Bombalier, Jennifer D. Burgar, Jessica T. Grozine, and W. Jerad Rissler!

AGG Partners Sara Lord and Michael Burke will present a complimentary webinar “FCPA Compliance 2017: What Life Sciences Companies Need to Know (and Do) Now” on January 25, 2017. 

AGG Partners Gene Burd and Michael Burke will present a complimentary webinar “International Arbitration: Top 5 Trends to Expect in 2017” on February 8, 2017.

AGG Partner Alan Minsk will present “Aktuelle Entwicklungen im Medizinprodukterecht” (translated as “Recent Developments in Medical Device Law”) on February 16, 2017 in Frankfurt, Germany.