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On September 24, 2020, HHS announced that it had finalized the Section 804 Importation Program regulations, which fall under the authority of Section 804 of the Federal Food, Drug and Cosmetic Act (FD&C Act) (21 U.S.C. § 384). Although the Section 804 authority has been in place for nearly twenty years, no previous HHS Secretary had been willing to certify, as required by the law, that drug importation would “pose no additional risk to the public’s health and safety” and would “result in a significant reduction in the cost of covered products to the American consumer.” The preamble to the Final Rule states that HHS Secretary Alex Azar is making the necessary certification to Congress in conjunction with this Final Rule. It also addresses a variety of comments from stakeholders regarding the scope and timing of the Section 804 certification, each of which raise novel questions of law and policy in light of the untested nature of the requirement. Perhaps most interestingly, however, the Final Rule notes several times that HHS/FDA is “unable to estimate the cost savings from this final rule, because we lack information about the likely size and scope of [Section 804 Importation Programs], the specific eligible prescription drugs that may be imported, the degree to which these imported drugs will be less expensive than nonimported drugs available in the United States, and which eligible prescription drugs are produced by U.S.-based drug manufacturers,” making it difficult to reconcile how the HHS Secretary was able to certify that it would result in a significant reduction in costs for U.S. consumers.
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As predicted, the Department of Justice (DOJ) and other enforcement agencies have acted quickly to bring substantial criminal enforcement actions for fraud against the Paycheck Protection Program (PPP). Acting Assistant Attorney General (AAG) Brian Rabbitt announced recently that the DOJ’s Criminal Division reached the important milestone that day of criminally charging more than 50 individuals for alleged fraud committed to obtain PPP funds.
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CMS Announces Final Rule on ESRD Treatment Choices Model

September 24, 2020 | Blog | By Cassandra Paolillo

Last week, CMS announced the finalized End-Stage Renal Disease (ESRD) Treatment Choices Model (ETC Model), which will test whether incentivizing home dialysis and kidney transplantation will reduce Medicare expenditures while maintaining or improving the quality of care furnished to beneficiaries with ESRD. This post summarizes how participants are selected, the specific payment changes, and the overall timeline.
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Bioethics in a Pandemic: Operation Warp Speed

September 23, 2020 | Blog | By Bridgette Keller, Elizabeth Conti

References to Operation Warp Speed (OWS) have been present throughout our coverage of the ethical questions related to the development and distribution of a COVID-19 vaccine. In fact, OWS is part of a broader public-private effort to accelerate COVID-19 countermeasures, such as the development, manufacturing, and distribution of COVID-19 vaccines, therapeutics, and diagnostics. OWS has ambitious goals. It intends to deliver 300 million doses of a safe and effective vaccine for COVID-19 by January 19, 2021. Here, we provide a brief overview of OWS, its current progress, and relevant ethical considerations.
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On September 9, 2020, the Department of Justice (DOJ) announced a $50 million settlement with Wheeling Hospital, Inc. of West Virginia to resolve False Claims Act allegations that Wheeling Hospital violated the Anti-Kickback Statute (AKS) and Stark Law. The settlement resolved False Claims Act allegations that were triggered by a qui tam lawsuit brought by a former vice president of Wheeling Hospital who oversaw hospital operations and physician engagements. According to the relator's complaint, Wheeling Hospital, under its former management, paid several physicians annual compensation in excess of a million dollars based on the volume or value of their referrals.
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Bioethics in a Pandemic: Vaccine Research and Clinical Trials

September 16, 2020 | Blog | By Bridgette Keller, Benjamin Zegarelli

After exploring some of the ethical questions involved in allocating and distributing a potential COVID-19 vaccine and the basic tenets of bioethics, we continue by delving into the ethical issues relating to the vaccine development process, including clinical trials. As a first step, we provide a very brief introduction on how vaccines are developed and tested prior to approval and release.
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Trump Signs Executive Orders Aimed at Tying Domestic Drug Prices to Foreign Prices

September 15, 2020 | Blog | By Theresa Carnegie, Michelle Caton

President Trump has followed through on his threat to pharmaceutical manufacturers, signing new executive orders on Sunday that take a preliminary step toward the President’s goal of tying domestic drug prices to the prices manufacturers charge in foreign countries. The “Executive Order on Lowering Drug Prices by Putting America First” follows a trio of drug pricing-related executive orders the administration issued this past July. At that time, President Trump also signed a different executive order with the same name, but withheld the order in an attempt to force pharmaceutical manufacturers to the negotiating table. The President warned manufacturers that if they did not propose alternatives to lower drug pricing within 30 days, his administration would take action to implement its previously-abandoned plan to peg U.S. drug prices to foreign prices. Sunday’s order follows weeks of negotiations between the White House and drug manufacturers that have apparently not resulted in any mutually-acceptable proposals for lowering American drug prices.
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363 Sales as a Health Care M&A Tool, Part 2 – Pros and Cons for Buyers and Sellers

September 11, 2020 | Blog | By Deborah Daccord, William Kannel, Rachel Irving Pitts, David Chorney, Tim McKeon

Over the summer, we wrote about why health care companies may want to consider buying assets out of bankruptcy, taking advantage of the Bankruptcy Code Section 363 sale process (a "363 Sale”). We are back with our second post, to provide more detail to the process and discuss some pros and cons of 363 Sales.

As a refresher, a 363 Sale couples a flexible and fast process with ample liability protection for willing buyers. The primary benefit of a 363 Sale is that a buyer can acquire the debtor’s assets free and clear of virtually all liens, claims, and interests burdening the assets and the debtor. And when Section 363 is coupled with the “assumption and assignment” provisions of Section 365 of the Bankruptcy Code, a debtor is able to assign most contracts or leases that a buyer may wish to purchase, including contracts with ironclad anti-assignment language, provided that certain conditions are satisfied. When a target is experiencing severe financial distress, the benefit of acquiring assets “free and clear” is extraordinarily valuable.
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Bioethics in a Pandemic: The Public’s Role in COVID-19 Vaccination

September 9, 2020 | Blog | By Bridgette Keller, Michelle Caton

As we noted in our previous post, the Johns Hopkins University Center for Health Security (Center) has been hard at work studying and providing thought leadership regarding the COVID-19 pandemic from a variety of angles. The Center, in conjunction with Texas State University and the Working Group on Readying Populations for COVID-19 Vaccine, recently released a report exploring the public’s role in COVID-19 vaccination (Report). The Report provides recommendations to U.S. policymakers, practitioners, and other stakeholders about how to advance public understanding of, access to, and acceptance of vaccines that protect against COVID-19.
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Bioethics in a Pandemic: Draft Framework for Equitable Allocation of COVID-19 Vaccine

September 4, 2020 | Blog | By Bridgette Keller, David Friedman

As you know, the Draft Preliminary Framework for Equitable Allocation of COVID-19 Vaccine (the “Draft Framework”) was released earlier this week, and we are highlighting its major sections as stakeholders prepare to submit comments by Friday, September 4th. Building on the lessons learned from past allocation frameworks, this post highlights the key provisions of the Draft Framework.
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Bioethics in a Pandemic: Uncertainties in Applying the Draft Framework

September 4, 2020 | Blog | By Bridgette Keller, David Friedman

Continuing with our review of the Draft Preliminary Framework for Equitable Allocation of COVID-19 Vaccine (the “Draft Framework”), this post highlights a number of uncertainties that will be faced in implementing the proposed allocation. For additional background on the Draft Framework, please see our earlier posts in the Bioethics in a Pandemic series. The final chapter of the committee’s discussion draft identifies specific uncertainties that could present obstacles to the proposed allocation plan’s implementation. Ultimately, a vaccine allocation framework must remain flexible and adaptive when faced with updated scientific evidence and developments like those listed above. These considerations, as well as the public comments, will continue to be inform the development of the framework.
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Earlier this week, a committee of the National Academies sponsored by the CDC and NIH released its Draft Framework for Equitable Allocation of COVID-19 Vaccine. This Draft Framework builds on the successes and challenges of past vaccine allocation frameworks, as well as current frameworks for allocating scarce COVID-19 resources. This blog reviews these past frameworks that laid the foundation for the committee to develop its decision-making framework.
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The Johns Hopkins University Center for Health Security (the “Center”) has been providing thought leadership related to the novel coronavirus and the COVID-19 pandemic since the beginning of the year. Two of the Center’s recent reports relate directly to our discussion on vaccine distribution.  The first is an interim framework for COVID-19 vaccine allocation and distribution (the “Report”), and the second focuses on the public’s role in COVID-19 vaccination. Here, we provide a high-level overview of the first report. We’ll dive into the second report in a separate blog post.
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Bioethics in a Pandemic: Learning from the Past

September 1, 2020 | Blog | By Bridgette Keller, David Friedman

As we continue to discuss the ethical considerations related to the distribution of a safe and effective coronavirus vaccine, it is important to consider lessons learned from other pandemics. Though the particular facts of past pandemics of course differ from those of COVID-19, the goal of public health has always been to promote and protect the health and well-being of a population. Similarly, the ethical distribution of resources amid any pandemic is supported by the balance and tension among the four ethics principles: autonomy, justice, beneficence, and nonmaleficence. Here, we look at lessens learned from the poliovirus, ebolavirus, and 2009 H1N1 pandemics, as well as the National Pandemic Strategy related to vaccine distribution.
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Earlier today, the Committee on Equitable Allocation of Vaccine for the Novel Coronavirus released preliminary guidelines on the allocation of initial and limited supplies of a forthcoming COVID-19 vaccine. Once finalized, this framework will inform how policymakers and health professionals should initially prioritize vaccine recipients, taking into account factors such as mitigating community spread, maximizing public health benefits, and ensuring equitable vaccine access for underserved communities.

Though the turnaround time is short, there are two ways for interested stakeholders and member of the public to submit feedback regarding the draft plan:
1. Speak at TOMORROW’s Public Listening Session (September 2, 12 PM EDT). Speakers must adhere to a strict 5-minute time limit and submit their interest in speaking in advance.
2. Submit Written Comment by September 4 at 11:59 PM EDT. Comments and uploaded materials will be made available in the Committee’s Public Access File and should be submitted at this link.
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The U.S. Department of Justice and U.S. Health and Human Services Office of Inspector General recently announced the indictment of a pharmacy marketer who allegedly received and paid kickbacks in violation of the federal Anti-Kickback Statute (AKS). While the alleged fraudulent scheme isn’t anything new, the actions that the marketer allegedly took to try to cover up the scheme serve as a good lesson.
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CMS Announces One-Year Delay in Finalizing Highly Anticipated Stark Law Reform

August 27, 2020 | Blog | By Karen Lovitch, Rachel Yount

On Wednesday, August 26th, the Centers for Medicare & Medicaid Services (CMS) issued a notice extending the deadline to finalize significant proposed changes to the Physician Self-Referral Law (commonly known as the Stark Law) announced last year. CMS published the proposed rule on October 17, 2019 in tandem with a companion proposed rule issued by Department of Health and Human Services (HHS) Office of Inspector General (OIG) with equally sweeping changes to the Anti-Kickback Statute (AKS). Both rules were issued as part of CMS’s Regulatory Sprint to Coordinated Care and offer a number of industry-friendly changes designed to reduce regulatory burden associated with the Stark Law and the AKS and allow for increased adoption of value-based arrangements.
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Bioethics in a Pandemic: The Basics

August 26, 2020 | Blog | By Bridgette Keller, David Friedman

Before we continue our Bioethics in a Pandemic series, we thought it would be helpful to provide a quick overview of the various principles that inform ethical decision-making in the health care setting.

As you might imagine, providing health care to individuals with diverse background and values presents ethical choices for health care professionals every day, throughout the entire health care system – providers, administrators, policymakers, insurers, employers, and even the health care lawyers! Well-recognized bioethics scholars Tom Beauchamp and James Childress offer a principle-based approach to guide ethical decision-making in health care. The four principles are (1) Respect for Autonomy, (2) Nonmaleficence, (3) Beneficence, and (4) Justice.
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Seventh Circuit Adds to Circuit Split Over Standard for DOJ Dismissals in FCA Cases

August 25, 2020 | Blog | By Laurence Freedman, Geoffrey Friedman, Caitie Hill

The Seventh Circuit Court of Appeals recently decided a case that created a new standard to assess requests by the Department of Justice (DOJ) to dismiss declined qui tam (whistleblower) suits under the False Claims Act (FCA). See U.S. ex rel. CIMZNHCA LLC V. UCB Inc. et al., No. 19-2273 (7th Cir. 2020). Prior to this decision, federal Courts of Appeals applied either the Sequoia Orange standard or the Swift standard, discussed below. In this decision, the Seventh Circuit opined that the standard should be informed by Federal Rule of Civil Procedure (FRCP) 41, and this standard “lies much nearer to Swift.” The Seventh Circuit also decided a key jurisdictional issue: whether the United States can appeal a denial of its motion to dismiss a declined qui tam action. Again, taking a new tack, the panel resolved this issue by construing the motion to dismiss also as a motion to intervene and construing the district court’s decision as a denial of that motion, thus obviating the need to invoke the collateral order doctrine.
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As we discussed in our previous blog post, the Department of Health and Human Services’ Office for Civil Rights (OCR) released guidance this past June to address how health care providers could contact, in a HIPAA-compliant manner, recovered COVID-19 patients to provide them with information about donating blood and plasma to potentially help other COVID-19 patients. On August 24, OCR released an updated version of that guidance to address similar communications from health plans. The amended guidance provides that health plans may also reach out to recovered COVID-19 patients about blood and plasma donation, subject to the same restrictions applicable to health care providers.
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