Health Care

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.

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.

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.

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.

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.

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.

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.

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.

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. 

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

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. 

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.

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.

As many of our readers know, we have been closely following the Polukoff False Claims Act (FCA) qui tam case in the Tenth Circuit for the lessons it might offer in defending FCA cases premised on allegations related to lack of medical necessity (among other topics).  Recently, we had the opportunity to consider this case from a different angle: the lessons it might offer to bankruptcy counsel advising clients who are or have been the subject of a health care fraud investigation and/or FCA qui tam case. 

As predicted by our colleagues earlier this month, outgoing Commissioner Scott Gottlieb of the U.S. Food and Drug Administration (FDA) released a comprehensive press release setting forth actions for possible FDA regulation of CBD products. FDA also reinforced its position that introducing CBD or THC infused products into interstate commerce, including marketing CBD and THC dietary supplements, continues to be illegal.  In furtherance of this position, FDA released three warning letters to businesses marketing CBD products for using “egregious and unfounded claims aimed at vulnerable populations.”

The Maryland General Assembly recently passed a bill that permits any person to directly or indirectly advertise diagnostic laboratory tests in the state, with certain limitations.  The bill currently awaits the Governor’s signature and will go into effect on October 1, 2019. Maryland law currently prohibits any marketing of laboratory tests to consumers, as well as any direct-to-consumer (“DTC”) testing without a physician’s order. 

This week, Congress will continue to look at lowering health costs. The House has been focused on both drug costs and overall health care costs, advancing packages to strengthen the individual market in addition to a series of bipartisan drug pricing bills. We cover this and more in this week's preview.

On June 28, 2018, California passed the California Consumer Privacy Act (CCPA) and then further amended it on September 23, 2018. CCPA breaks new state law privacy ground, and this post addresses some of the confusion surrounding the exemptions for health information.

In recent months, we’ve highlighted several changes that CMS is implementing to combat opioid misuse. In this post, we focus on CMS’s new Medicare Part D Opioid Overutilization Policies.


Last year, CMS published a road map outlining the agency’s approach to addressing the nation’s opioid epidemic. CMS’s strategy has three prongs: (1) prevent new cases of opioid use disorder (OUD); (2) expand treatment for individuals with OUDs; and (3) leverage data to improve the agency’s prevention and treatment options.


In line with that strategy, the agency published an article detailing its Medicare Part D Opioid Overutilization Policies for 2019. The policies focus on improving communication between and among Part D plans (PDPs) and providers to better coordinate efforts to prevent opioid misuse. As CMS points out, “Providers are in the best position to identify and manage potential opioid overutilization in the Medicare Part D population. Medicare prescription drug plans can assist providers by alerting them about unusual utilization patterns in prescription claims.”