Please join us for an upcoming CLE webinar, “Preparing for the inevitable: FCA investigations in a post-COVID world”

The CARES Act funding was a lifeline for many health care organizations and life sciences companies, but came with significant attached strings. Related fraud charges are already making headlines and bring with them the serious risk of False Claims Act litigation, which can have bet-the-company implications for companies.

Please join us this Wednesday, August 5 at 2 p.m. ET for a CLE webinar on “Preparing for the inevitable: FCA investigations in a post-COVID world” presented by our Life Sciences Health Industry Group partners Rick Robinson and Sarah Cummings.

This webinar will help companies understand the False Claims Act enforcement risks stemming from CARES Act funds, along with other enforcement risks stemming from COVID-related developments. Rick and Sarah will also provide an overview of recent key False Claims Act enforcement developments pre-COVID to set the stage for the discussion.

For more information, or to register, please click here.

This program is presumptively approved for 1.0 CLE credit in California, Connecticut, Illinois, New Jersey, New York, Pennsylvania, Texas and West Virginia. Applications for CLE credit will be filed in Delaware, Florida, Ohio, and Virginia.  Attendees who are licensed in other jurisdictions will receive a uniform certificate of attendance but Reed Smith only provides credit for the states listed.

Reed Smith hosts July 16 life sciences virtual roundtable on “Deal making in a post-COVID world”

While the life sciences sector has proven more resilient than most, COVID-19 has undoubtedly caused a dramatic slowdown in deal activity globally across industries. Please join Reed Smith and a panel of strategic, private equity, and venture capital leading deal makers for an engaging discussion on the impact COVID-19 has had on deal making in the life sciences sector, lessons learned, and their perspectives on deal making and deal trends in the sector in a post-COVID-19 world.

Our speakers include:

  • Iqbal Hussain, Life Sciences Transactional Partner, Reed Smith
  • A. Maria Dahl, Head of Transactions: Oncology Business Development & Licensing, AstraZeneca
  • Edward de Nor, Executive Parter, GHO Capital
  • Johan Verbeeck, Vice President Business Development, Immunology, Janssen Pharmaceutical Companies of Johnson & Johnson
  • Laurence Barker, Partner and CBO, Dementia Discovery Fund SV Heath Investors
  • James West, Director, Results Healthcare

You can register for the roundtable by clicking here.

COVID-19 pandemic: German government further extends foreign investment control rules with regard to transactions in the life sciences sector

The German Federal Ministry for Economic Affairs and Energy implemented further amendments to the Foreign Trade and Payments Ordinance (Außenwirtschaftsverordnung – AWV) due to the COVID-19 pandemic to prevent the buyout of German companies active in the life sciences and infection protection sectors by investors from outside the EU (or EFTA). The amendment entered into force on 3 June 2020.

The amendment broadens the scope of application of cross-sector reviews. In particular, the development and manufacture of the following products are covered by the cross-sectoral reviews:

  • personal protective equipment, such as face masks;
  • essential medicines such as vaccines (and including raw materials and active ingredients);
  • medical products used for diagnosing, preventing, monitoring, predicting, forecasting, treating, or alleviating life-threatening and highly contagious infectious diseases; or
  • in vitro diagnostics that are used to provide information on physiological or pathological processes or conditions, or for determining or monitoring therapeutic measures in connection with life-threatening and highly contagious infectious diseases.

Companies active in these sectors should be aware of the amendments implemented by the German government when planning and structuring such a transaction involving an investor from outside the EU (or EFTA) and a German business. For more information, please read our post on Reed Smith’s Antitrust and Competition Report blog.

EU unveils roadmap for EU pharmaceutical strategy

On 2 June, the European Commission (Commission) published a roadmap (Roadmap) that will pave the way for the Commission’s communication on the EU pharmaceutical strategy, which is now due in the last quarter of 2020. The Roadmap should be read together with the Commission’s proposal for a recovery of the EU’s economy (Next Generation EU), which was published on 27 May and which includes a section on lessons learned from the COVID-19 pandemic for European health systems, governments, and pharmaceutical companies.

Key points of the Roadmap are:

1. Competing goals. The Roadmap builds further on the Commission’s existing rhetoric to ensure the access, affordability, and availability of medicines against the backdrop of an aging population, constrained healthcare budgets, increased R&D costs, the need for patient-centricity, and market access challenges for pharmaceutical companies. The unknown impact of a global pandemic can now be added to that.

Whilst the EU often advocates a holistic approach in its policy developments, it is to be seen if all of these objectives can be matched in a way that makes sense for the different stakeholders across the life sciences and health care sector. Different departments within the Commission will also not necessarily act in tandem when developing the EU pharmaceutical strategy. DG Sante is in the lead, but other Commission Directorate Generals (specifically DG RTD, DG GROW, DG Trade, and DG COMP) will be closely involved and will want to make their mark too.

2. Strategic autonomy. Considerable emphasis in the Roadmap is placed on securing the pharmaceutical supply chain and ensuring the EU’s strategic autonomy by reducing Europe’s dependency on imports of medicines and active pharmaceutical ingredients (APIs). This is not surprising in light of trade restrictions on medical supplies imposed by some EU countries as well as by third countries to deal with the COVID-19 pandemic. However, the outsourcing of the production of APIs to contract manufacturers located all over the world, most of them in India and China, had already been widely discussed in Commission circles (in particular the EU’s pharmaceutical committee) before the pandemic outbreak. The pandemic merely highlights the international dimension of the pharmaceutical manufacturing and supply activities and associated risks if there is a (serious) hitch in the supply chain. To that end, the Roadmap points out the need for EU manufacturing capacity for APIs and starting materials (though not specifying if this only concerns highly potent APIs, for example). In addition, existing work to ensure the security of drug and ingredient supply chains (e.g., through good manufacturing practice standards and on-site inspections) will continue.

3. Digital disruption. The Roadmap acknowledges the transformative impact of technology on the healthcare and life sciences sector, in particular AI and real-world evidence. However, the regulatory frameworks are lagging behind, resulting in possible barriers to value-based contracting and patient access to innovative products. The Roadmap mentions, by way of example, the support for such breakthrough innovation and emerging technology through “innovative procurement.”

4. Sustainability. Sustainability is a key EU objective across all sectors and policy areas and features prominently in the EU Green Deal, the Industrial Strategy, and the recovery plans as part of Next Generation EU. Adopting a full life-cycle approach, the Roadmap underlines the need for rational use of medicines with less resources, emissions, and pollution.

5. Market access. The Roadmap recognizes that pricing and reimbursement are Member States’ prerogatives, though emphasizes the need for more coordination and collaboration between countries on issues such as cost effectiveness and measuring added therapeutic value, including on health technology assessment. Drug pricing will be looked at too (and has been already by DG COMP) and the emphasis on “need-driven innovation” in the Roadmap is telling in that respect. The Roadmap further emphasizes the importance of the sound functioning of the internal market for generics and biosimilars.

6. EU funds. To assist companies and governments to implement the above objectives, EU funds will be made available (e.g., Horizon Europe, InvestEU, and Digital Europe Programs). Note that as part of its recovery plan, the Commission is also proposing to create a new standalone EU4Health program, with a budget of €9.4 billion.

The deadline for providing feedback on the Roadmap is 7 July 2020.

Reed Smith’s lawyers are ready to support companies and organizations in preparing their submissions to the consultation.

For further information, please contact me.

Reed Smith’s Kevin Madagan and Julia Lake to Present an Advertising and Promotion Primer at DIA’s Regulatory Affairs Conference

Reed Smith partner Kevin Madagan and associate Julia Lake will return for a second year to help lead a four-hour “Ad Promo Primer” at the Drug Information Association (DIA)’s “Advertising and Promotion Regulatory Affairs Conference,” which will be held virtually May 18-20, 2020. In addition, Kevin, a member of this year’s planning committee, will be leading a DIA discussion about pricing disclosures and communications.

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California Governor Relaxes Telehealth Regulations During COVID-19 Emergency

California Governor Gavin Newsom’s Executive Order N-43-20 (the Order), which went into effect on April 3, 2020, relaxes various telehealth reporting requirements, penalties, and enforcements otherwise imposed under state laws, including those associated with unauthorized access and disclosure of personal information through telehealth mediums.  The Order acknowledged that telehealth services may help reduce the spread of COVID-19, and strict compliance with certain state telehealth requirements would otherwise “prevent, hinder, or delay appropriate actions to prevent and mitigate the effects of the COVID-19 pandemic.” This Order affects certain health care facilities, health care providers, health care administrators, clinics, home health agencies, and hospice providers, generally in instances where non-compliance occurs during the “good faith provision of telehealth services.”  Although the Order should provide comfort to health entities engaged in telehealth services, this Order remains in effect only through the state of emergency.  Moreover health entities should continue to remain steadfast in protecting personal information from unauthorized access or use during COVID-19 and beyond.  For a more in-depth explanation of the Order, please visit our Technology Law Dispatch blog

Please join us for an upcoming CLE webinar, “COVID-19’s impact on the global pharmaceutical supply chain and steps to take now”

Pharmaceutical manufacturers, as well as other companies affected by or included in changes to pharmaceutical supply chains, are invited to join us tomorrow, April 7, for a complimentary webinar focused on current issues facing the global pharmaceutical supply chain.

Reed Smith partners J.P. Duffy, Iqbal Hussain, and John Ellison will offer an engaging discussion on:

  • The steps that companies need to take now given the potential for international arbitration claims to arise from challenges such as export restrictions in India and decreased manufacturing of active pharmaceutical ingredients in China and elsewhere.
  • Clause drafting issues.
  • The consequences of choosing common law over civil law as the governing law of the contract.
  • How to select arbitrators for pharmaceutical supply chain disputes.
  • How companies should address indemnification obligations and insurance matters.

To register for the webinar, please click here.

This program is presumptively approved for 1.0 general CLE credit in California, Illinois, New Jersey, Pennsylvania, Texas and West Virginia. For lawyers licensed in New York, this course is eligible for 1.0 credit under New York’s Approved Jurisdiction Policy. Please allow four weeks after the program to receive a certificate of attendance.

Reed Smith White Paper on Major Health Care Policy, Funding Provisions in CARES Act

The United States recently passed the “Coronavirus Aid, Relief, and Economic Security Act” (CARES Act), sweeping legislation that could impact pharmaceutical and medical device companies with U.S. operations or significant U.S. sales.

A team of Reed Smith life sciences and health care lawyers, including Scot T. HasselmanRobert J. HillCarol Colborn LoepereKevin M. MadaganPaul W. PittsJames F. SegrovesNicole J. Aiken-ShabanJulia Krebs-MarkrichDebra A. McCurdyJohn D. KendziorJamie KnauerArielle R. LusardiRahul NarulaSonia T. NguyenSung W. Park, and Ryan M. Pate has authored a white paper that provides in-depth analysis of major policy and funding provisions in the Act. In addition, Reed Smith has published a CARES Act Overview, which covers all portions of the Act, and is compiling additional thought leadership at our CARES Act Resource Center.

COVID-19 pandemic: FCC issues guidance on the TCPA’s “emergency purposes exception”

The Telephone Consumer Protection Act (the TCPA) restricts telemarketing and the use of automated telephone equipment for phone calls, faxes, and text messages. In an effort to ease restrictions in light of the COVID-19 outbreak, the Federal Communications Commission (FCC) has issued guidance clarifying that informational calls that are directly related to the imminent health or safety risk arising out of the COVID-19 outbreak and made by certain types of callers are exempt from the TCPA requirements under the “emergency purposes exception.”

The FCC’s guidance, issued as a Declaratory Ruling on March 20, 2020 (the “Ruling”), explains that the FCC has determined that the COVID-19 outbreak constitutes “an imminent health risk to the public” under the “emergency purposes” exception described above. The Ruling further provides criteria for determining whether a call relating to the COVID-19 pandemic qualifies for the exception:

  • The caller must be: (1) calling from a hospital, (2) a health care provider, (3) a state or local health official, or other government official, or (4) a person acting on behalf of such an organization and on its express direction; and
  • The content of the call must be solely informational, made necessary as a result of the COVID-19 outbreak, and directly related to the imminent health or safety risk arising out of the COVID-19 outbreak.

With businesses of all types – and especially health care providers – dealing with unprecedented changes to their business models, the TCPA and other privacy laws include exceptions for certain disclosures and communications. The FCC’s confirmation that the COVID-19 outbreak qualifies for such an exception is not surprising but should provide comfort to health care providers who are trying to communicate with patients about necessary appointment changes, office closings, and safety precautions. Health care providers should still be thoughtful in their communications to ensure that they remain purely informational and should watch for additional guidance from the FCC when the pandemic wanes and such communications are no longer necessary.

Read more about this guidance on our Technology Law Dispatch blog.

Medical Device Manufacturers Could Be Affected by Recent CMS Guidance to Health Care Providers

Medical device manufacturers, who may already be seeing the effects of lessened demand stemming from a slow-down of elective procedures outside of the United States, should be aware of recent guidance the U.S. Centers for Medicare and Medicaid Services (CMS) issued to health care providers urging limitations on elective surgeries and nonessential procedures. As an example, nonurgent spine and orthopedic implants (such as hip and knee replacements and elective spine surgeries) in healthy patients were included among the types of procedures CMS recommends that providers consider postponing.

For further information on the guidance, please see this recent client alert by Reed Smith partner Lesley Reynolds and associate Janine Tougas.

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