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Heritage Pharmaceuticals Admits to Generic Drug Price Fixing Scheme

June 13, 2019 | Blog | By Michelle Caton, Farrah Short

In the latest development in the Department of Justice (DOJ) Antitrust Division’s ongoing investigation into the generic pharmaceutical industry, Heritage Pharmaceuticals, Inc. has entered into a deferred prosecution agreement (DPA) with DOJ. The terms of the DPA require Heritage to pay a $225,000 criminal penalty and provide full cooperation with the ongoing investigation. The one-count felony charge, filed in the Eastern District of Pennsylvania on May 30, alleges that Heritage violated Section 1 of the Sherman Act by conspiring with multiple unnamed parties to divide up the domestic market and fix prices for glyburide, a diabetes medication, from April 2014 through December 2015. According to DOJ, the DPA provides that the United States will not prosecute Heritage for three years.
Viewpoint General

HIPAA Updates: New Guidance for Business Associates and Continued Data Breaches

June 10, 2019 | Blog | By Sarah Beth Kuyers, Kate Stewart

The HHS Office for Civil Rights (OCR) released a new guidance document regarding which HIPAA violations business associates (BAs) can and cannot be held directly liable for.  In the guidance, OCR states that BAs can be held directly liable for a list of 10 violations but notes that certain other violations, like the reasonable cost requirement for a patient’s access to their PHI, cannot be enforced directly by OCR against a BA.  The covered entity (CE) is still on the hook for violations of this type, however, so CEs should carefully review their BAAs to ensure that it covers requirements that don’t directly apply to BAs but are still enforceable against CEs.  Large data breaches also continue to dominate the press.
Viewpoint

EMR Company Suffers Double Whammy After HIPAA Breach

June 5, 2019 | Blog | By Kristen Marotta

Medical Informatics Engineering, Inc. (Medical Informatics) and its wholly-owned subsidiary, NoMoreClipboard, LLC, an electronic medical record and software services provider is now liable for a combined total of $1 million to both the federal and state governments after hackers accessed approximately 3.5 million patients’ health records in 2015. The breach, reported to OCR on July 23, 2015, occurred through a compromised user ID and password. Compromised patient information included social security numbers, names, email addresses, health insurance policy information, addresses, dates of birth, and clinical information.
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OIG Issues Fraud Alert Regarding Fraudulent Genetic Testing Schemes

June 5, 2019 | Blog | By Karen Lovitch, Matt Mora

Earlier this week the OIG took the somewhat unusual step of issuing a fraud alert directed to Medicare beneficiaries (rather than to Medicare providers) regarding “fraud schemes” that involve genetic testing. According to the OIG, beneficiaries are being offered genetic tests in order to obtain their Medicare information, which is then used to commit identity theft or to submit fraudulent claims to Medicare. Beneficiaries are being targeted through telemarketing calls, booths at public events, health fairs, and door-to-door visits.
Viewpoint General
On June 3, 2019, the U.S. Supreme Court issued a decision in Azar v. Allina Health Services. The case involved a challenge by hospitals over whether the Department of Health and Human Services (“HHS”) was required to proceed through notice-and-comment rulemaking before promulgating a retroactive Medicare rate calculation methodology for Disproportionate Share (DSH) payments to hospitals. In a 7-1 decision by Justice Gorsuch, the Court ruled in favor of the hospitals, holding that the new rate calculation established a substantive legal standard, and therefore notice-and-comment was required under the Medicare Act.
Viewpoint General
As most folks with any interest in the burgeoning cannabidiol (CBD) industry likely know, on May 31, 2019, the Food and Drug Administration held a public hearing “to obtain scientific data and information about the safety, manufacturing, product quality, marketing, labeling, and sale of products containing cannabis or cannabis-derived compounds.” Stakeholders who attended the hearing presented many diverse viewpoints and the FDA panelists – who were in listening mode – received extensive information from across that spectrum of perspective.
Viewpoint General
In the ongoing public dialogue about prescription drug affordability, Maryland seems poised to lead the way for states considering a new way to rein in drug spending: drug affordability boards.

CMS Finalizes Medicare Advantage and Part D Drug Pricing Rule

May 28, 2019 | Blog | By Bridgette Keller, Daryl Berke, Lauren Moldawer

Earlier this month, CMS issued a final rule aimed at lowering drug prices and reducing out-of-pocket expenses in Medicare Advantage and Medicare Part D. This rule is the Administration’s latest effort to address prescription drug prices and builds off the Administration’s Blueprint to Lower Drug Prices and Reduce Out-of-Pocket Costs and arrive on the heels of CMS publishing a rule requiring the disclosure of drug prices in TV ads. Below we’ve provided a brief overview of the major provisions in the final rule, noting changes from the proposed rule that was issued in November 2018.
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FDA Ratchets Up Pressure on Homeopathic Drug Manufacturers

May 23, 2019 | Blog | By Benjamin Zegarelli

On May 14, FDA announced that it issued five Warning Letters to companies that manufacture and market homeopathic drugs for human use. The letters all cite cGMP deficiencies relating to inspectional observations and conclude that the products are misbranded prescription drugs under the Federal Food, Drug, and Cosmetic Act because “in light of their toxicity or other potentiality for harmful effect, or the method of their use, or the collateral measures necessary to their use, they are not safe for use except under the supervision of a practitioner licensed by law to administer such drugs” and they are not labeled for prescription use only.

In 2019 so far, FDA has issued Warning Letters to eleven separate homeopathic drug manufacturers, including the five letters referenced above. All of the Warning Letters, except one, cite observations from inspections and focus on cGMP and quality violations at the manufacturing facilities, including contamination and varying amounts of active ingredients, that could lead to consumer harm.
Viewpoint General
This week, the House Energy & Commerce Committee is voting on seven more drug pricing bills. The Senate is going to be unveiling its cost-containment package in the coming weeks (if not days) and should include most, if not all, of the House-passed drug pricing bills. This action will set the stage for the summer work period, which is expected to focus heavily on drug pricing and other cost-containment measures, such as surprise medical bills. At CMS, the agency published a final rule last week that touched on several noteworthy drug pricing issues. We cover this and more in this week's preview, which you can find by clicking here. 
On May 10, 2019, the Food and Drug Administration issued highly anticipated final guidance that gives drug-makers more clarity on how to demonstrate that a proposed biosimilar product meets the statutory interchangeability standard under the Public Health Service Act (PHS Act or the Act). According to the Act, an interchangeable biosimilar may be substituted for the original biological product without the involvement of a prescriber, similar to the way generic drugs are routinely substituted for brand name drugs at the pharmacy level. The Final Guidance, entitled “Considerations in Demonstrating Interchangeability with a Reference Product,” is shorter than the draft version released over two years ago, in response to industry feedback, but generally tracks the original policy positions proposed in the draft, with a few notable exceptions summarized below.
Health Privacy

Health Care & Cybersecurity: A Powerful Combination

May 14, 2019 | Blog | By Cynthia Larose

The adoption of connected medical devices and the Internet of Medical Things (IoMT) has both enhanced the quality of patient care and increased the vulnerability of health care organizations. Sophisticated cyberattacks on hospitals and health systems threaten patient safety and impose substantial financial costs.
Viewpoint General

ML Strategies Health Care Preview: Congress's Summer Plans Filling Up Fast

May 13, 2019 | Blog | By Eli Greenspan, Alexander Hecht

Congress is circling an issue that is not black and white in terms of the stakeholders it could impact and how interests will align. The leaders of the Senate Health, Education, Labor, and Pensions Committee and the Senate Finance Committee are poised to release a cost-containment package in the coming weeks which will touch on surprise billing issues, drug pricing, and other access and transparency issues. While there is intense bipartisan interest in addressing some of these issues, it is unclear how exactly this package will reach the President's desk given the current political climate.
Viewpoint General
Last week, Mintz and ML Strategies welcomed stakeholders and thought leaders from across the pharmacy and pharmaceutical industry to the Boston Office for the 4th Annual Pharmacy & Pharmaceutical Industry Summit.
Viewpoint General

DOJ Issues Guidance on Cooperation Credit in FCA Settlements

May 10, 2019 | Blog | By Jane Haviland, Laurence Freedman

The U.S. Department of Justice (DOJ) issued policy guidance on May 6, 2019, about providing credit in False Claims Act (FCA) settlements to corporations for “disclosure, cooperation, and remediation." DOJ has never previously issued guidance regarding credit in FCA matters. This guidance, coupled with the passage of the Tax Cuts and Jobs Act in 2017 (which requires DOJ to specify the amount of “restitution” or “remediation” at the time of settlement), provides meaningful specificity as to what conduct constitutes disclosure, cooperation, and remediation, as well as data for evaluating whether credit is actually reflected in negotiated FCA settlements. This policy guidance is contained in the Justice Manual, Section 4-4.112.
Viewpoint General

FCA Relator and U.S. Weigh in on Defendants' Argument that the FCA is Unconstitutional

May 9, 2019 | Blog | By Samantha Kingsbury, Brian Dunphy

As part of our ongoing discussion of the Polukoff False Claims Act (FCA) qui tam case (involving allegations that certain heart procedures performed by a cardiologist, and billed for by two hospital defendants, were not medically necessary), we reported in February that some defendants filed a petition for a writ of certiorari with the United States Supreme Court. 
Viewpoint General
Yesterday, May 8, 2019, the Centers for Medicaid & Medicaid Services (“CMS”) released its final rule requiring drug manufacturers to disclose a drug’s wholesale acquisition cost (“WAC”) in direct-to-consumer television advertisements. The rule, which will become final 60 days after the official publication of the rule (which will be tomorrow, May 10, 2019) was proposal last fall. CMS is largely adopting the rule as published last fall with minor technical changes for clarification
Viewpoint General

ML Strategies Health Care Preview: House Poised to Pass First Drug Pricing Bills

May 8, 2019 | Blog | By Eli Greenspan, Alexander Hecht

This week, the House is poised to take action on drug pricing by passing two pieces of legislation. As the House moves bills through final passage, focus will shift to the Senate which will in the coming weeks unveil a legislative package around lowering costs for consumers. The scope of this package is still unclear, but it should include a number of proposals that could pass on a bipartisan basis. We cover this and more in this week's preview, which you can find by clicking here. 
Viewpoint General
FDA's Comprehensive Regenerative Medicine Policy Framework is nearing the halfway mark of the “grace period” the Agency extended for certain regenerative medicine product developers to come into compliance by obtaining investigational new drug applications (INDs) and working towards premarket approval of their products.
Viewpoint General

MLS Weekly Preview: Medicare For All Gets a Hearing

April 29, 2019 | Blog | By Eli Greenspan, Alexander Hecht

Following the two week recess, Congress is back in session and will have several high profile hearings this week. For starters, the Energy & Commerce Health subcommittee will continue reviewing prescription drug costs, this time focusing in on Medicare. In the Rules Committee, which does not typically host high profile hearings, they will hold the first committee hearing on H.R. 1384, one of the "Medicare for All" proposals.


The House is poised to pass several noteworthy drug pricing bills this work period, as well as legislation to strengthen the Affordable Care Act. Once the House votes on these bills, the question will then become what is the Senate able to pass and what is their appetite for taking it on this summer. We cover this and more in this week's preview.

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