Life Science Compliance Update

June 30, 2017

The 21st Century Cures Act: Is It Worth the Cost for Lifesciences?


The 21st Century Cures Act (“Act”), which provides substantial funding for medical research, seeks to alleviate the regulatory process for developmental and experimental treatments and to implement reform measures on mental health care. This article explores whether the long-term the Act’s benefits will outweigh the costs.

The 21st Century Cures Act (“Act”), passed by the U.S. Congress and signed into law by former U.S. President Obama on December 13, 2016, legislatively boosts funding for a host of government research and regulatory programs including $4.8 billion for the National Institutes
of Health (“NIH”); $1.8 billion to accelerate research for cancer; $1.6 billion for brain diseases including Alzheimer’s; $500 million in funding for the U.S. Food and Drug Administration (“FDA”) and $1 billion in grants to assist States deal with opioid abuse.

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June 28, 2017

An FCA Journey - Allergan to Pay $53M to DOJ

Allergan Logo_02

Allergan has been hit with hefty fines over the past several months. This article outlines Allergan's alleged wrongdoing, and the settlement amount agreed to by the government and Allergan. 

The Life Science industry is no stranger to sales representatives as whistleblowers. Nor is the industry a stranger to claims of “sham” educational programs as disguised kickbacks to prescribers. Allergan (formerly Forest Laboratories) early in 2017 became the first in a long line of companies to settle claims with both the U.S. Department of Justice (“DOJ”) and Securities and Exchange Commission (“SEC”) – albeit on different issues.

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June 26, 2017

Genentech & Escobar: Using Materiality to Escape False Claims Liability


In constructively bringing an end to a False Claims Act (“FCA”) whistleblower suit alleging Genentech, Inc. (“Genentech”) of defrauding Medicare by way of concealing substantive health care analytics data involving purported side effects of the company’s cancer drug Avastin, the Third Circuit of Appeals in a recent decision determined that the Plaintiff in this matter had failed to demonstrate that any noncompliance had an impact on government payments. Specifically, the Court applied the prevailing standard in Escobar that an FCA lawsuit must demonstrate that any misrepresentation is “material” to the government’s payment decision. In dismissing this suit and invoking this heightened standard of materiality, the Third Circuit not only reinforces Escobar but places the now clear burden on FCA Plaintiffs to demonstrate that any noncompliance was material to alleged fraudulent payments.

Back in August 2016, we highlighted the widely watched and reported U.S. Supreme Court decision in Universal Health Services, Inc. v. United States ex rel. Escobar (“Escobar”). The case “reaffirmed that the government and realtors via qui tam suits can pursue False Claim Act liability against life science and healthcare companies” while adding “a requirement that such parties must also demonstrate any misrepresentations were “material” on statutory, regulatory, or contractual requirements that make such representations misleading on those goods and services."

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