European Patent Litigation for Life Sciences Companies: a Silver Lining to the Brexit Cloud?

The introduction of the Unified Patent Court (UPC) is undoubtedly the most significant change to the European patent landscape since the European Patent Convention of 1973. It will have a profound effect on how life sciences companies set about their patent strategies – from filing through exploitation to enforcement.

Leaving aside the inevitable delays to the UPC project, there is a serious risk that Brexit means that the UPC will be diminished in the eyes of one of its major user constituencies, the international life sciences companies. These companies have extensive experience of the alternative to the UPC, the national country-by-country litigation route.

Counter intuitively, Brexit may make the UK a more important patent litigation venue than it would have been as part of the federal UPC system. The UK’s commercial significance means that companies will have to litigate in the UK as well as in Europe (whether in the UPC or in the national courts).

  • Brexit has, if anything, shifted the strategic balance. A diminished federal UPC system in Europe without UK participation runs the risk of being seen as less appealing by its potential users, especially the global life sciences and technology companies.
  • Brexit may increase the attractiveness of the current national litigation route as an alternative to the UPC for life sciences companies.
  • Brexit is likely to increase English patent judges’ willingness to grant pan-European declarations of non-infringement, paving the way for more complex and disruptive patent litigation strategies.

Please click here to read the full article drafted by London IP partner, Jonathan Radcliffe on this topic (originally published in August 2016 by Bloomberg).

Off-Label Promotion And The First Amendment Updates

Although activity around the Amarin and Pacira cases has settled down, questions regarding the FDA’s position on truthful off-label promotion-and whether it comports with First Amendment free speech principles—persist.

The FDA has announced a two-day public hearing on November 9 and 10, 2016 regarding “Manufacturer Communications Regarding Unapproved Uses of Approved or Cleared Medical Products.”  In-person attendance is via pre-registration, written comments are accepted via (and should reflect the docket number “FDA-2016-N-1149”), and the meeting will be webcast as well.

Even more recently, on September 19, 2016, the Medical Information Working Group (MIWG) filed an amicus brief on these issues with the District of Massachusetts in United States v. Facteau in support of the defendants’ motion for a judgment of acquittal or new trial.

As the MIWG brief explains:

In particular, the MIWG has sought to address concerns that the current enforcement scheme is at odds with fundamental First and Fifth Amendment principles that permit manufacturers to engage in truthful and non-misleading communications about off-label uses of their products.  The unclear rules that characterize the regulatory framework, and the Government’s expansive and ad-hoc approach to enforcement, provide inadequate notice of the line between permissible and impermissible speech and, as a result, manufacturers’ constitutionally protected speech is chilled.

Id. at 1.

This MIWG brief should be a useful resource for anyone addressing off-label promotion issues, regardless of whether those involve alleged regulatory violations (as with the criminal prosecution in Facteau) or allegations of tort liability in civil litigation.  And, it cites to our colleagues over at the Drug and Device Law Blog for their post about how long it has taken to get clarity from the FDA about the First Amendment free speech issues with its regulation of off-label promotion.


FDA Mandates Black Box Warnings For Opioids And Benzodiazepines

The Food and Drug Administration (FDA) recently decided to require so-called “black box warnings” on nearly 400 products, warning of the risks of combining certain opioid medications and central nervous system depressants called benzodiazepines.

Opioids are a class of powerful, pain-reducing medications that include oxycodone, fentanyl, and morphine.  Certain prescription cough suppressants also contain opioids.  Benzodiazepines, such as Xanax and Valium, are typically prescribed to treat neurological or psychological conditions such as anxiety, insomnia, and seizures.  Both classes of drugs suppress the central nervous system and can cause drowsiness, dizziness, nausea, and slow or difficult breathing.  Using these types of drugs together heightens those risks.

FDA’s new mandate comes after the Agency concluded that physicians increasingly prescribe both classes of drugs to the same patient, and that the rate of emergency room visits involving non-medical use of both drug classes had increased significantly from 2004 to 2011, with the rate of overdose involving both drug classes having tripled in that time.

While both opioids and benzodiazepines already carry warnings about the risks of combining the two types of drug, the new black box warnings are intended to catch the attention of the physicians and patients and underscore the seriousness of the threat.

The FDA’s mandate is one of a number of steps the FDA is taking as part of the agency’s Opioids Action Plan.  This plan focuses on policies aimed at reversing a growing prescription opioid epidemic while continuing to allow patients to effectively manage their pain.  Manufacturers of opioid and benzodiazepine undoubtedly are already in the process of  revising their labeling, including patient information, to comply with the new mandate.

Boosts in Ransomware Attacks Spark Multiple Government Agency Responses

Following a recent U.S. government interagency report indicating that, on average, there has been an alarming 300 percent spike in daily ransomware attacks since early 2016 as compared with 2015, the U.S. Department of Health and Human Services (“HHS”) Office for Civil Rights (“OCR”) released new Health Insurance Portability and Accountability Act (“HIPAA”) guidance on ransomware.  In addition to OCR’s guidance, the Secretary of HHS sent a letter to chief executive officers of companies in the health care sector stressing the importance of robust security compliance to combat ransomware attacks.

Ransomware, as explained by OCR, is a type of malware (i.e., malicious software) that most often attempts to deny access to a user’s data, usually by encrypting the data, until a ransom is paid. Hackers may also deploy ransomware in conjunction with other malware that destroys or transfers data from the infected information system.  Indicators of a ransomware attack could include, for example, an inability to access certain files, or a user’s realization that a link or file attachment that was opened may have been malicious in nature.

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Privacy Shield to Enter into Force Immediately in EU, on August 1 in U.S.

The EU-U.S. Privacy Shield has been adopted by the European Commission. On July 12, 2016, following a positive vote from the member states (the Article 31 Committee) on July 8, the EU College of Commissioners formally adopted the Privacy Shield. The Privacy Shield enters into force immediately in the EU. In the U.S., the Privacy Shield will be published in the Federal Register, becoming effective on August 1.

To learn more about this development, please read the recent Reed Smith Client Alert, “EU-U.S. Data Privacy Shield adopted – a phoenix rising from the ashes of Safe Harbour?” written by Cynthia O’Donoghue, Kate Brimsted, Philip Thomas, Paul Bond, and Gerard M. Stegmaier.

Reed Smith Attorneys to Speak at Upcoming “Women Leaders in Life Sciences Law” Conference

Two members of Reed Smith’s Life Sciences Health Industry (LSHI) group will be speaking at the American Conference Institute’s 3rd Annual Conference on Women Leaders in Life Sciences Law taking place in Boston on July 27-29, 2016.

On July 28, Reed Smith partner and co-chair of the firm’s LSHI group, Melissa A. Geist will discuss some of the most cutting-edge legal challenges in the life sciences space in a panel entitled, “What Women Leaders in Life Sciences Law Must Know About Products Liability, Mass Torts, and ‘Bet-the-Company’ Litigation.” On July 29, Reed Smith partner Gail L. Daubert will be speaking on building a pricing and reimbursement strategy during the panel presentation, “Key Regulatory and Pricing Developments Affecting How Life Sciences Companies Bring Products to Market.”

The “Women Leaders in Life Sciences Law” event was created to increase the prominence of women in the life sciences legal community through substantive legal discussion, professional development and woman-to-woman networking. This year’s program features an impressive lineup of women leaders throughout the life sciences community poised to discuss key legal developments for pharmaceutical, biotech and medical device companies as well as engage in candid discussion of gender stereotypes and other implicit obstacles to advancement.

As a proud sponsor of this event, Reed Smith is able to offer a 15 percent registration discount for clients who would like to attend. To obtain the discount, enter the code P15-999-RSH16 while registering online. (Your discount will be manually applied at the end of the registration process by American Conference Institute customer service staff.)

What Brexit Means for Data Protection

For global pharmaceutical and medical device companies handling personal data in the European Union (EU) or engaged in transatlantic data transfers, some of the many questions created by the Brexit vote include what its impact will be on the United Kingdom’s (UK) data protection laws.

These questions also arise in the context of the EU’s General Data Protection Regulation (GDPR), due to come into force in May 2018, which coincides with the period during which the UK will be negotiating its EU exit, and the impending agreement by the EU to the Privacy Shield.  The GDPR is designed to strengthen and harmonise data protection within the EU and the Privacy Shield is meant to replace the now invalid EU-US Safe Harbor Framework. Given this, it is important for manufacturers to consider the following:

How will personal data be regulated under UK law?

If the UK exits the EU before the GDPR comes into force, it will not be without a data protection law. The UK’s own Data Protection Act 1998 (DPA) is currently and would remain the law of the land. Even now, the UK’s Information Commissioner’s Office interprets the DPA in a manner that is consistent with some of the GDPR requirements, such as privacy by design and accountability through the use of privacy impact assessments. Compliance with the DPA provides a degree of compliance with the GDPR.

What will the UK-EU relationship look like with respect to data protection?

Given that the GDPR may come into force in the UK and EU before the UK’s negotiation period to leave the EU is complete, the UK should not find it difficult to achieve the ‘adequate’ data protection status necessary to maintain current trade and commercial relationships with the EU. It may be that the UK adopts much of the GDPR into its law, either as an update to the DPA, or as a new legislative measure.

How will Brexit affect data transfers?

Brexit will not affect the Privacy Shield agreement, and for the UK, Brexit should not change UK policy in relation to the Privacy Shield. Since the DPA permits UK data controllers to make their own adequacy determination for transferring data outside the UK and the European Economic Area (EEA), it may be that the UK’s Information Commissioner’s Office deems certification to the Privacy Shield by US companies adequate even if the UK is outside the EU. Such a stance would not be unprecedented, since other countries, such as Israel, had taken a similar position in relation to the US-EU Safe Harbor Framework before it had been ruled invalid by the CJEU. If that is the case, then transfers of data to the US on the basis of certification to the Privacy Shield could be deemed per se adequate by the UK.

In addition, the UK remains a member of the Council of Europe and a party to Convention 108 for the Protection of Individuals with regard to Automatic Processing of Personal Data. The Convention provisions relating to transborder data flows permit the transfer of data between Convention 108 members, which include not only the EU member states, but a total of 50 countries, including Turkey, Russia, and Ukraine, among others.

To learn more about Brexit’s potential impact on the United Kingdom’s (UK) data protection laws, and about how Brexit could provide an unexpected opportunity for the UK to become a data haven, please read our recent Client Alert, “Data Protection in a Post-Brexit Landscape.”

Major Changes To Nondiscrimination Requirements Under ACA Effective Soon: Are Covered Entities Ready?

The HHS Office of Civil Rights (“OCR”) published a final rule May 18, 2016, broadening the nondiscrimination requirements applicable to all health programs and activities receiving federal financial assistance from HHS, those administered by HHS, and Health Insurance Marketplaces. The final rule implements section 1557 of the ACA and adds two important categories of protections: (1) prohibition of discrimination on the basis of sex; and (2) mandatory meaningful access for individuals with limited English proficiency. Also included in the final rule, OCR outlines specific actions covered entities must take to signal their compliance with these nondiscrimination requirements.

Effective July 18, 2016, the final rule has largely flown under the radar since its publication, begging the question: are covered entities prepared to comply with these new requirements? The deadline to implement changes applies to all covered entities, except health insurance or group health plans. As this July 18, 2016, date approaches rapidly, covered entities should understand the final rule’s key provisions and the changes they must make to ensure their health programs and activities are in compliance.

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Upcoming Free CLE Webinar on Country of Origin Issues for Pharmaceutical, Medical Device Companies

The Reed Smith Life Sciences Health Industry Group will be hosting a free CLE webinar, “Where Was This Made? Country-of-Origin Issues for Pharmaceutical & Medical Device Companies,” on July 19, 2016 at 12 p.m. ET. Drug and device manufacturers often struggle to correctly determine their products’ “country of origin” thanks to ever-changing global supply chains and the fact that different government agencies employ entirely different legal standards. As a result, a product’s country of origin may vary based on which agency is requiring a determination. This has caused considerable confusion and, yet, compliance has never been more important as multi-million dollar False Claims Act actions become more frequent for companies that incorrectly certify the origin of their products to the government.

In this webinar, Reed Smith presenters Jeffrey Orenstein and Lawrence Sher will be examining the numerous regulatory requirements that companies must take into consideration to ensure compliance over time. They will also be explaining the risks of non-compliance in the context of both administrative penalties and False Claims Act actions initiated by the government and whistleblowers.

This webinar is approved for 1 hour of general CLE credit in CA, IL, NJ, PA, TX and WV. To register for the free webinar, please click here.

Upcoming Free CLE Webinar on Medicare Secondary Payer, Best Practices for the Defense

The Reed Smith Life Sciences Health Industry Group will be hosting a free CLE webinar, “Medicare Secondary Payer: Issues and Best Practices for the Defense,” on July 13, 2016 at 12 p.m. ET. Reed Smith presenters Eric Gladbach and Mildred Segura will be providing an overview and timeline of Medicare Secondary Payer reporting responsibilities; discussing best practices in discovery demands, release language, check issuance, and requesting payment/no payment letters from Medicare; examining the Global Resolution Option alternative; and highlighting other issues corporate defendants may face, such as future costs and set-asides.

This webinar is approved for 1 hour of general CLE credit in CA, IL, NJ, PA, TX and WV. To register for the free webinar, please click here.