The Year That Was: 2016 Sonia M. Valdes, Esq. Vice President, - - PowerPoint PPT Presentation
The Year That Was: 2016 Sonia M. Valdes, Esq. Vice President, Medmarc Kara Trouslot Stubbs, Esq. Partner, Baker Sterchi Cowden & Rice, LLC Agenda Drug and Device Pricing Off-Label Communication/Free Speech Issues State Actions vs. Drug
Vice President, Medmarc
Partner, Baker Sterchi Cowden & Rice, LLC
1
2
3
Price controls Negotiated Medicare drug prices Value-based pricing Capping out-of-pocket costs of certain drugs Scrap patent monopolies and drug exclusivity
4
Rigorous and detailed accounting of:
Costs of clinical trials Costs of premarket approval or approval process Costs of Regulatory Compliance such as AE reporting to the FDA Costs of any corrective action Costs of sale of product at reduced prices Investments in additional research to update the product by making it safer (warnings, delivery methods, etc.) Investments in the community
5
FDA’s historical position: Off-label promotion by a manufacturer is unlawful even if statements are truthful and non-misleading. Case law challenging FDA’s position – Caronia and Amarin FDA’s March 2016settlement with Amarin What does the landscape look like today?
6
Erosion of FDA regulation of off-label promotion.
Amarin may engage in “truthful and non-misleading speech” promoting off-label use of Vascepa and under Caronia, such speech may not form the basis or a prosecution for misbranding. FDA agrees to be bound by Court’s conclusion that the statements and disclosures Amarin proposes to make to physicians are truthful and non-misleading. Amarin bears the responsibility of assuring that its communications remain truthful and non-misleading. FDA agreed to provide Amarin with an optional preclearance provision through 2020 for new off-label claims. Both sides agreed to a dispute resolution provision intended to avoid future litigation.
7
What does the landscape look like today?
No protection for statements that are either untruthful or misleading. It may be easy to determine if a claim is untruthful, but it can be much more difficult to know if a claim is misleading or not. A manufacturer that leaves its sales force at liberty to converse unscripted with doctors about off-label use of an approved drug, risks a misbranding action, if false or misleading. Medicine and science is ever-evolving. A statement that is truthful and non-misleading today, may not be tomorrow. The speech at issue in Amarin was directed to healthcare providers, which limits applicability to direct-to-consumer advertising. Key rulings are limited to Second Circuit.
8
LATEST AND GREATEST:
“Manufacturer Communications Regarding Unapproved Uses of Approved or Cleared Medical Products.” Written comments will be accepted by FDA until 1/9/17.
9
Genesis – Medicaid reimbursement by the tobacco industry. Birth of “regulation by litigation.” Advances policy preferences against gun manufacturers, lead paint manufacturers, alleged contributors to global warming, gasoline refiners and not surprisingly, pharmaceutical and medical device manufacturers. How it works. Confidential contingency fee arrangements between public
10
Opioids:
Illinois AG sues Insys Therapy for deceptive marketing of spray version of Fentanyl. NY AG sues Endo Pharmaceuticals for false advertising. Alleges company distorted addictive nature of the Opana ER. NY, PA and 33 other states have filed anti-trust complaint against Invidor alleging it was trying to keep out generic version of its opiate addiction treatment drug.
Other Drugs and Medical Devices
New Mexico AG goes after Bristol Myers for false advertising of
11
CA and WA State AGs sue J&J for false advertising and deceptive marketing
potential complications. Drug Pricing MD AG sues J&J for antitrust violations alleging the Company negotiated an agreement with Costco to increase the price of its lens products. Mass AG files an action against Gilead arising out of price increases on two Hep C drugs, Sovaldi and Harvoni. City of Providence, RI proceeds against Allergan, Mylan and others over generic drug prices. UK fined Pfizer ₤84.2 ($106M) for escalating the price of an Epilepsy drug. Notable settlements Novartis will pay $35M settlement to dismiss of-label allegations arising from its Elidel product
12
AG Allegations:
False advertising Off-label promotion Inadequate warnings or instructions in labeling or promotional materials (second guessing the FDA) Inadequate AE reporting Withholding data from the FDA Unfair competition – attempting to control availability of generics Unfair pricing
13
14
In re: DePuy Orthopaedics, Inc., Pinnacle Hip Implant Product Liability Litigation, USDC for the N.D. Texas
$1.04 BILLION VERDICT (12/1/16)
Third bellwether trial - 6 CA plaintiffs $4-6M per plaintiff for compensatory damages $504M punitive damages against J&J and DePuy (each)
$502 MILLION VERDICT (3/17/16)
Second bellwether trial – 5 TX plaintiffs $140M in compensatory damages divided between 5 plaintiffs $360M in punitive damages; reduced to $10M per TX caps
DEFENSE VERDICT IN FIRST BELLWETHER (2014) 8000 cases remain in the MDL
15
Talcum Powder Verdicts
Plaintiffs allege link between talcum powder and ovarian cancer
Three trials in Circuit Court for City of St. Louis (MO)
Fox v. J&J: $72M verdict (2/2016) - SD plaintiff Ristesund v. J&J: $55M verdict (5/2016) – AL plaintiff Giannecchini v. J&J: $70M verdict (8/2016) – CA plaintiff
J&J appealing verdicts 2500 claims pending, majority in the City of St. Louis
16
Talcum powder, pelvic mesh, hernia mesh, IVC filters, etc.
Low bar for admission of expert testimony/junk science
NJ state court judge granted summary judgment in two talc cases finding plaintiffs’ experts (same ones who testified in MO cases), had gaps in their “made-for-litigation” scientific methods and failed to explain how talcum powder specifically causes ovarian cancer.
Misleading advertising about product in advance of trial
17
Risperdal, Mass Tort Program, Philadelphia Court of Common Pleas
Allegation: Risperdal, an anti-psychotic medication, causes gynecomastia in adolescent boys 5 Trials:
1st trial – Defense Verdict 2nd – 4th trials – Verdicts totaling $4.75M for plaintiffs 5th trial - $70M Verdict (7/1/16) – compensatory damages ONLY 6th trial - Case settled running up to trial, amount undisclosed (11/2/16)
2000 cases remain J&J/Janssen Pharmaceuticals are not looking to globally resolve the litigation
18
Carlino v. Ethicon, Inc., Philadelphia Court of Common Pleas – 2/16
Pelvic mesh case – transvaginal tape product $13.5M Verdict
$10M in punitive damages Followed $12.5M Prolift verdict in Dec. 2015 ($7M punis)
Plaintiff did not have extraordinary injuries or numerous surgeries afterwards. “Trial in a box”
19
Sherrer v. Boston Scientific Corporation and C.R. Bard, Inc., Circuit Court of Jackson County, Missouri (Kansas City)
Alleged BSC’s Solyx pelvic mesh and Bard’s Align pelvic mesh products were defectively designed and contained inadequate warnings. First trial involving two manufacturers Plaintiff sought $28M, punitive damages DEFENSE VERDICT
20
DeLine v. Wright Medical Technology, Inc., et al., Circuit Court Of
Alleged femoral neck component of the ProFemur metal-on-metal hip prosthesis was defectively designed, and inadequate warnings. Product liability and medical malpractice claims. DEFENSE VERDICT
21
In re: Wright Medical Technology Inc., Conserve Hip Implant Products Liability Litigation, USDC N.D. GA
Alleged defects related to the metal-on-metal Conserve artificial hip implant 1st bellwether trial (11/2015) - Jury indicated that Wright’s system was not defective, yet awarded $11M. Judge ordered that the jury resubmit its form, which then found the hip device defective.
$1M compensatory; $10M punitives, reduced to $1.1M
$240M SETTLEMENT (11/2/16)
Ends 1300 claims 600 claims not included will be part of subsequent settlement program
22
Fresenius GranuFlo/NaturaLyte Dialysate Products Liability Litigation, USDC for Massachusetts (MDL)
Plaintiffs alleged that the company concealed its knowledge that chemical components produced in the body after taking dialysis drugs could eliminate too much acid and create an electrical imbalance that can cause fatal heart attack and stroke. SETTLEMENT: $250M (2/17/16)
Settlement reached day before first bellwether trial to begin $220M funded by insurance 4000 cases in the MDL
23
In re: American Medical Systems Inc. Pelvic Repair System Products Liability Litigation, USDC for S.D. West Virginia (MDL) – May 2016
Settled 135 cases/amount of settlement not disclosed
Johnson & Johnson/Ethicon settlement – January 2016
Reportedly agreed to pay more tan $120M to resolve 2000 – 3000 lawsuits
24
25
FDA issues Draft Guidance Document for Postmarket Management
Objective: to provide manufacturers with structure and specificity in their quest to counter threats to patient safety Three major areas of concern:
Risk assessment Remediating and reporting vulnerabilities The elements of an effective postmarketing cybersecurity program
Agency leaves manufacturers significant leeway in developing their
accepted industry standards.
26
“Factors to Consider Regarding Benefit-Risk in Medical Device Product Availability, Compliance and Enforcement Decisions”, released June of 2016
Applies to diagnostic and therapeutic medical devices exempt from Premarket review. Guidance does not apply to:
Devices regulated by CBER Combination products Electronic products that are not medical devices Premarket submission review decisions
Patient Focused Benefit-Risk Assessments
27
Examples of benefit factors include type of benefit, magnitude of benefit, likelihood of tolerance of risk. Guidance assumes Risk Factors such as risk severity, likelihood of risk, nonconforming product risk, duration of exposure to population, false-positive or fast-negative and patient tolerance of risk. Assumes Additional Facts exist such as uncertainty, detectability, failure mode, preference for availability, nature of violations and firm compliance history.
28
Defines SaMD as “software intended to be used for one or more medical purposes that perform these purposes without being part
Examples include software that:
Allows a smartphone to view images for diagnostic purposes Processes images from hardware medical devices for aiding in the detection of cancer Provides parameters that become the input for a different hardware medical device or other SaMD
Does not include software that:
Drives or controls the pumping of medication in an infusion pump Encrypts data for transmission from a medical device Enables such clinical communication and workflow as patient registration, scheduling visits, voice/video calling.
29
Imposes risk-based criteria for categorization and clinical evaluation of SaMD.
Guidance is vague on what constitutes the required data for clinical evaluation. Lack of detail may be confusing for manufacturers
Focus shifts toward “observed real world performance as part of post-market monitoring.” 60-day comment period ended 12/13/16
30
Ongoing litigation tourism with mass torts Increasing state action, source of revenue for states Challenges regarding punitive damage awards/new case law Renewed efforts with tort reform Continued focus on cybersecurity issues with medical devices by FDA and with litigation Potential removal of barriers to entry in the market for “drug providers that offer safe, reliable and cheaper products” Potentially problematic products
31
32