James Hodge on ‘The Week in Health Law’ Podcast

By Nicolas Terry and Frank Pasquale

twihl 5x5

This week’s guest was James G. Hodge, Jr., JD, LLM, Professor of Public Health Law and Ethics and Director of the Public Health Law and Policy Program at the Sandra Day O’Connor College of Law, Arizona State University. Through scholarship, teaching, and applied projects, Professor Hodge delves into multiple areas of health law, public health law, global health law, ethics, and human rights.

Our lightning round this week focused on drug prices. Nic analyzed a California referendum proposal and the general potential of state drug price cap laws. Frank noted that New York’s Medicaid program and private insurers now must take a much more humane approach with respect to state-of-the-art treatment for Hepatitis C.

Our conversation with James focused on his recent work addressing the Zika virus. We covered topics ranging from the genetic modification of mosquitoes to the Puerto Rico financial crisis, and legal interventions ranging from budget requests to quarantines to price controls for condoms and mosquito repellent.

The Week in Health Law Podcast from Frank Pasquale and Nicolas Terry is a commuting-length discussion about some of the more thorny issues in Health Law & Policy. Subscribe at iTunes, listen at Stitcher RadioTunein and Podbean, or search for The Week in Health Law in your favorite podcast app. Show notes and more are at TWIHL.com. If you have comments, an idea for a show or a topic to discuss you can find us on twitter @nicolasterry @FrankPasquale @WeekInHealthLaw

State Drug Price Cap Laws: How Do They Work?

Two weeks ago, I blogged here about various state bills designed to encourage transparency in the pharmaceutical industry, by requiring companies to disclose information about their research & development costs, marketing expenses, and prices charged to different purchasers. In that post, I glossed over the state initiatives to cap drug prices directly, but as these initiatives have been more recently in the news, I want to focus on them here and ask a basic question: can someone explain to me how they would work?

Let’s back up. Two states, California and Ohio, are considering ballot initiatives that propose to cap what drug manufacturers can charge to public payers in the state (such as Medicaid).  The texts of the initiatives are nearly identical, with a few state-specific differences in the enumeration of entities eligible to pay the capped price.  As clearly stated in a comprehensive POLITICO article earlier this week by Nancy Cook and Sarah Karlin-Smith, the initiatives “would require the state to pay no more for prescription drugs than the U.S. Department of Veterans Affairs — one of the few federal agencies allowed to negotiate drug prices.”

We can and should debate whether price caps like these are a good idea, as a policy matter, and the Cook & Karlin-Smith piece canvasses a number of the arguments on both sides.  But first, we should be clear that the laws we’re enacting can actually accomplish their intended purpose.  And if they can’t, we should acknowledge that publicly.  I see at least two primary obstacles to the implementation of these price cap initiatives, and since they’ve largely been absent from the public discussion, it’s useful to state them explicitly.

Continue reading

Implied Certification and the Problem of Interpretation Under the False Claims Act

by Joan H. Krause

[Cross-posted from Hamilton and Griffin On Rights]

In a recent post, I explained the contours of the False Claims Act (FCA) implied certification theory of falsity, the subject of the recent Supreme Court argument in Universal Health Services v. United States(UHS). In this post, I will address an issue largely overlooked by most commentators: the potential for differing interpretations of what is required by the underlying Medicare and Medicaid provisions that form the basis for the certification.

Recent years have seen an expansion of FCA cases from “factually false” misrepresentations to those involving “legally false” claims, where items or services were provided but the claimant also violated an underlying legal requirement. For example, UHS involves an allegation that the defendant clinic violated the FCA because, by submitting a claim for payment under MassHealth, it implicitly certified that it was in compliance with all relevant Massachusetts regulations – including the staffing and supervision requirements it later was found to have violated.

Courts have taken two broad approaches to defining the universe of regulatory provisions with which certification will be implied. Some courts, notably the Second Circuit in Mikes v. Straus, 274 F.3d 687 (2d Cir. 2001), limit the theory to violations of statutes or regulations clearly identified as conditions of payment. Other courts, such as the First Circuit in UHS, instead ask whether the claimant “knowingly represented compliance with a material precondition of payment,” which need not be “expressly designated.” The tests may sound similar, but differ both theoretically and functionally. First, defining implied certification by reference to “materiality” is curious in light of the fact that, since 2009, materiality has been an express – and distinct – element of the FCA false records provision in 31 US.C. § 3729(a)(1)(B). Yet implied certification cases such as UHS usually arise under the false claims provision in § 3729(a)(1)(A), which Congress did not amend to require materiality.

Continue reading

Looking Towards 2030 in Patient Safety

There is a clear need for those charged with patient safety policy making to prepare for the future and to take account of emerging trends. This would be so in any commercial or professional organisation. These issues were addressed in the context of patient safety at the recent,Patient Safety Global Action Summit held in March 2016 in London. The conference was designed to mirror the discussions contained in the report  by NIHR (National Institute for Health Research), Patient Safety Translational Research Centre at Imperial College London and The Imperial College NHS Trust on the priorities and direction that the patient safety movement should follow going towards 2030.

There is a lot that is excellent in this report  which is very rich in analysis and detail. Lots of deep thinking about patient safety issues with interesting and novel ideas expressed on nearly every page.

Emerging threats to patient safety

In the report, in chapter one, it is acknowledged that there are many existing issues at the root of patient harm that have yet to be solved. Also that unfortunately trends in healthcare are likely to increase the risks to safety. The report focuses on four emerging trends: Continue reading

Amicus brief in Amicus v. Sequenom: Why the U.S. Supreme Court should grant the petition for a writ of certiorari

I am happy to announce that on April 20th the New York attorney Robert M. Schwartz and I have filed an amicus brief at the US Supreme Court with Berkeley-based Andrew J. Dhuey as Counsel of Record. The brief, which was signed by 10 prominent  European and Australian Law Professors as amici curiae, adds a European perspective to the many amicus briefs that have been submitted in support of Sequenom’s petition for certiorari to the United States Supreme Court. Sequenom’s petition in Case No. 15-1182 was filed on March 21, 2016 and seeks review of the Federal Circuit’s controversial decision in Ariosa Diagnostics, Inc. v. Sequenom, Inc., 788 F.3d 1371, reh’g denied, 809 F.3d 1282 (Fed. Cir. 2015). The case concerns the revocation of Sequenom’s patent claims directed to inventive methods of genetic testing by detecting and amplifying paternally inherited fetal cell-free DNA (cffDNA) from maternal blood and plasma. Before the development of this highly beneficial, non-invasive prenatal diagnostic test, patients were placed at higher risk and maternal plasma was routinely discarded as waste. Distinguishing this case from previous Supreme Court decisions and highlighting the mitigating effects of other patentability requirements, we fear that the Federal Circuit’s overly rigid approach to claims eligibility decision might jeopardize the development of new therapies in an increasingly important area of modern medicine.

As most Bill of Health readers know, the US Supreme Court has in a recent series of cases (i.e. the combined effect of Bilski, Prometheus, Myriad and Alice) barred the patent eligibility for many genetic inventions as “products and processes of nature”. In Sequenom the CAFC interpreted these to mean – in essence- that “laws of nature” had to be entirely eliminated from the test of patent eligibility under §101 of the Patent laws. Should this interpretation be institutionalized it will contravene the tests for exclusions and exceptions under the EPC, arguably contradict longstanding US treaty policy and disrupt international patent harmonization. More importantly, we fear that the broader impact of such an restrictive interpretation may have grave consequences for a sustainable global drug delivery system, which should involve both public and private actors.

Although we believe that patents will remain the backbone of the industry, we acknowledge in our brief that  there are certain areas of biomedical innovations, such as antibiotics and orphan drugs, where the patent system does not work particularly well. We further recognize that both in Europe and in the US concerns have been raised about overly pre-emptive patents scope, but these are addressed at different levels. In contrast to Europe, the CAFC has interpreted the uncodified exception as part of a “threshold test” for patent-eligibility applied before other patentability requirements can be assessed. A strict and coherent application of these requirements, however, would invalidate overly-broad patent claims, while also permitting, well-defined, narrower claims on diagnostic technology. In our view, the current approach conflates the patent eligibility test with issues that can be more sensibly addressed within a strict and coherent assessment of novelty, non-obviousness and sufficient disclosure criteria or at the post-grant level. We believe that, the Federal Circuit’s threshold test has not sufficiently considered the manner in which today’s statutory requirements have developed in both the U.S. and Europe to address policy rationales for patentability exceptions. To entirely transplant those issues into the patent eligibility assessment would categorically close the patentability door on many well-defined and beneficial inventions that deserve patent protection. In absence of sufficient public involvement and appropriate alternative incentives we risk that the wells driving technological progress run dry and that companies engage in business strategies, such as increased reliance on trade secrecy, that are not necessarily beneficial for our innovation system.

Accordingly, we urge the Supreme Court to clarify a patent eligibility test in line with its longstanding jurisprudence and in harmony with international and European law.

If the CAFC’s restrictive interpretation should prevail, however, I believe that it will be crucial to swiftly optimize the framework for PPPs, alternative innovation incentives and regulatory exclusivities on an international level to allow for greater flexibilities and encompass further technological areas, such as biomedical diagnostics. Article 39 of the TRIPS agreement should provide sufficient leeway for such changes, but the pros and cons of such alternative approaches would have to be carefully considered.

The Amici curiae have no stake in the parties or in the outcome of the case. A full list of the Amici is appended at the end of the brief.

 

Heather Howard on ‘The Week in Health Law’ Podcast

By Nicolas Terry and Frank Pasquale

twihl 5x5

This week we talked with Heather H. Howard, Lecturer in Public Affairs at Princeton University and Director of the State Health Reform Assistance Network. She served as New Jersey’s Commissioner of Health and Senior Services from 2008-2010, overseeing a cabinet-level agency with a budget of $3.5 billion and staff of 1,700 responsible for public health services, regulation of health care institutions, senior services, and health care policy and research.

Our lightning round “closed the loop” on some prior stories. Nic noted a big fine against a hospital which may end ER reality shows (or at least raise the price of their insurance policies), and a smaller action from OCR with a simple message: covered entities need to complete their BAAs! Prior show guest Nicholas Bagley offered an administrative end run around Gobeille. We also discussed the kaleidoscopic complexity of modern insurance markets.

Our conversation with Heather touched on her pastpresent, and future work on ACA 1332 waivers. If you care about innovation in state health policy, this podcast is for you.

The Week in Health Law Podcast from Frank Pasquale and Nicolas Terry is a commuting-length discussion about some of the more thorny issues in Health Law & Policy. Subscribe at iTunes, listen at Stitcher RadioTunein and Podbean, or search for The Week in Health Law in your favorite podcast app. Show notes and more are at TWIHL.com. If you have comments, an idea for a show or a topic to discuss you can find us on twitter @nicolasterry @FrankPasquale @WeekInHealthLaw

REGISTER NOW! 2016 Annual Conference: Big Data, Health Law, and Bioethics

Close-up of fiber optic cables

2016 Annual Conference:
Big Data, Health Law, and Bioethics
May 6, 2016
Wasserstein Hall, Milstein East ABC
Harvard Law School, 1585 Massachusetts Ave., Cambridge, MA

“Big Data” is a phrase that has been used pervasively by the media and the lay public in the last several years. While many definitions are possible, the common denominator seems to include the “three V’s” – Volume (vast amounts of data), Variety (significant heterogeneity in the type of data available in the set), and Velocity (speed at which a data scientist or user can access and analyze the data).

Defined as such, health care has become one of the key emerging use cases for big data. For example, Fitbit and Apple’s ResearchKit can provide researchers access to vast stores of biometric data on users from which to test hypotheses on nutrition, fitness, disease progression, treatment success, and the like. The Centers for Medicare & Medicaid Services (CMS) have vast stores of billing data that can be mined to promote high value care and prevent fraud; the same is true of private health insurers.  And hospitals have attempted to reduce re-admission rates by targeting patients that predictive algorithms indicate are at highest risk based on analysis of available data collected from existing patient records. Continue reading

Implied Certification and the Quest for Fraud that “Counts” Under the False Claims Act

By Joan H. Krause

[Cross-posted from Hamilton and Griffin on Rights]

Sometimes, we lie when we speak; other times, we lie when we don’t. Striking the right balance is the essence of the Universal Health Services (UHS) case recently argued before the Supreme Court, which challenged the applicability of the False Claims Act (FCA) to situations in which a claimant falsely “implies” compliance with underlying regulatory requirements.

UHS was brought by the parents of a young woman who died after receiving Medicaid-covered (MassHealth) mental health treatment from a clinic that did not satisfy state licensing and supervision regulations. The parents alleged that the claims for payment were fraudulent because they implicitly represented that the clinic was in full compliance with relevant state requirements. The district court dismissed the suit, finding that the staffing and supervision regulations were not “conditions of payment” whose violation would render subsequent claims false under the FCA. The First Circuit reversed, focusing instead on whether UHS had “knowingly represented compliance with a material precondition of payment.” Noting that preconditions need not be “expressly designated,” the court identified a set of regulations that, read together, appeared to limit MassHealth payment to properly supervised care. While such a fact-intensive dispute might at first appear an unlikely candidate for certiorari, UHS was one of several such “implied certification” opinions issued by the federal appellate courts in 2015. Perhaps because of its emotionally compelling facts – the other cases involved, inter alia, the recruitment practices of a for-profit college and a military contractor that falsified marksmanship scores – UHS was chosen as the vehicle to resolve a growing circuit split. Continue reading

Variability of US State Workplace Wellness Program Laws

A team of researchers led by Jennifer Pomeranz, JD, MPH, Clinical Assistant Professor of the College of Global Public Health at New York University, have released a new set of resources that detail characteristics of laws related to workplace wellness programs and identify trends in these laws across the United States: interactive maps for public and private employers at LawAtlas.org and a paper published in the American Journal of Public Health.

Workplace Wellness Program Laws in US

A few key findings:

  • Thirty-three states and the District of Columbia have laws related to workplace wellness programs.
  • Four states (Georgia, Indiana, Maine and Massachusetts) provide tax incentives for work place wellness programs.
  • State laws addressed public and private employers differently, for example, five states permit rewards (e.g., discounts, rebates and waivers) by public employers, whereas 16 states expressly permit positive rewards for participation in programs by private employers.

The research was funded by the Robert Wood Johnson Foundation’s Public Health Law Research Program.

What do doctors know about FDA drug approval standards and the breakthrough therapy designation? Less than we’d hope.

By Dalia Deak

A study published this week in JAMA examined how much physicians know about FDA approval standards for new drugs and the breakthrough therapy designation. The investigators found major gaps in understanding with regard to both issues, despite intuitive beliefs to the contrary.

For the study, Kesselheim et al. conducted a national survey of board-certified internists and specialists. They selected a random sample of 300 clinically active internists and 900 specialists in endocrinology, hematology, and infectious diseases from the American Board of Internal Medicine’s diplomate list. Of the 1,148 physicians contacted, 692 physicians, or 60%, responded.

Continue reading

Monday, 4/18, HLS Health Law Workshop with Robert Cook-Deegan

April 18, 2016, 5-7 PM
Hauser Hall 105
Harvard Law School, 1575 Massachusetts Ave., Cambridge, MA 02138

The materials for the presentation, “Mining the Genomic Data Mountain: Legal and Policy Challenges,” can be downloaded here.

Robert Cook-Deegan is a research professor in the Sanford School of Public Policy at Duke University, with secondary appointments in Internal Medicine (School of Medicine), and Biology (Trinity College of Arts & Sciences). He was the founding director for Genome Ethics, Law & Policy in Duke’s Institute for Genome Sciences & Policy from July 2002 through December 2012.  He is the author of The Gene Wars: Science, Politics, and the Human Genome and an author on over 250 articles.

Dr. Cook-Deegan’s areas of expertise include genomics and intellectual property, history of genomics, global health, science and health policy, and health research policy. His current research focuses on policy implications of genomics, bioethics, intellectual property, and innovation.

Leo Beletsky on ‘The Week in Health Law’ Podcast

By Nicolas Terry and Frank Pasquale

twihl 5x5

This week we interviewed Leo Beletsky, Associate Professor of Law and Health Sciences at Northeastern University. Leo utilizes empirical and theoretical approaches to analyze how legal mechanisms can help curb substance abuse, prevent the spread of HIV and other infectious diseases and improve patient care. By highlighting discrepancies between black letter law and its real-world implementation, he also examines the relationship between police practices, public health outcomes and human rights of vulnerable groups.

We had plenty of opportunity to apply Leo’s expertise to the topic we focused on this week: opioid addiction. Recent studies have demonstrated a rapidly rising rate of opioid abuse, with troubling consequences for individuals and communities. This drug use has also attracted a host of legal responses, which Leo has expertly dissected in past work (including some recent studies here).

Our lightning round featured discussions of recent research on income and life expectancy, the emerging natural experiment in Kentucky on Medicaid rollback, and insurer mergers.

The Week in Health Law Podcast from Frank Pasquale and Nicolas Terry is a commuting-length discussion about some of the more thorny issues in Health Law & Policy. Subscribe at iTunes, listen at Stitcher RadioTunein and Podbean, or search for The Week in Health Law in your favorite podcast app. Show notes and more are at TWIHL.com. If you have comments, an idea for a show or a topic to discuss you can find us on twitter @nicolasterry @FrankPasquale @WeekInHealthLaw

Virginia’s Proposed Lethal Injection Secrecy Law

By Elizabeth Guo

On Monday, Governor Terry McAuliffe of Virginia proposed a significant change to the Virginia legislature’s bill to replace lethal injection with electrocution in death penalty cases. Instead of allowing electrocution, the amendment would give greater authority to the Department of Corrections (DOC) for procuring and making lethal injection drugs. Under the proposed amendments, the DOC could contract with a pharmacy to compound drugs necessary to carry out lethal injection. The amendments would also keep the names of drug suppliers and compounders secret by exempting the information from the Freedom of Information Act. Also, the names would not be discoverable “in any civil proceeding unless good cause is shown.”

States with capital punishment are increasingly resorting to state secrecy laws as they are finding it harder to procure the lethal injection drugs they need. At least fourteen states have passed or tried to pass rules keeping the names of lethal injection suppliers confidential. Some states, such as Georgia, define information about the drugs and equipment used in an execution as a “confidential state secret” so that the public prisoners and even courts are prevented from viewing the information. Other states, including Oklahoma, do not designate this information as a state secret but nonetheless, make the information unavailable through litigation. A few states allow litigants to discover the information through litigation, but the state does not need to make the information publicly available.

Continue reading

Pharmaceutical Transparency Bills: Targeting Disclosures Purposefully

On Monday, the Massachusetts Joint Committee on Health Care Financing held a hearing on Senate bill 1048, which would require pharmaceutical companies to report to the state a range of information on their research & development costs, marketing and advertising costs, and prices charged to a number of different purchasers.  The hearing, recapped by the Boston Globe and Gloucester Times (among others), went as expected, with industry executives opposing the bill and health insurers, consumer advocates, and others testifying in support.

Massachusetts is not the only state considering a transparency bill.  At least ten other states, including California, North Carolina, Oregon, and Virginia have all drafted bills that would advance similar goals.  These bills do differ in their details.  As just one example, each state would require disclosure from a different set of drugs and companies.  Massachusetts would only require disclosure of costs and pricing for the top twenty selling drugs in the state (where the list is based around a set of criteria including but not limited to cost), California, Oregon, and Virginia would require disclosure for any drug whose wholesale cost is $10,000 or more per year (in California, this includes over 900 drugs), and North Carolina’s bill is framed around classes of drugs, rather than prices.

It is no accident that these bills have been developed in the wake of Martin Shkreli, Valeant Pharmaceuticals, and other drug pricing scandals.  Patients and policymakers are seizing this moment to take action against the drug industry.  Forcing companies to disclose their R&D costs, advertising costs, and pricing practices is seen as a step in the right direction against these secretive companies.  In this blog post, I want to focus on just one of many interesting issues raised by these bills: what and who are they useful for, and how can we target the required disclosures to best achieve those ends?  More specifically, I’m not interested in transparency for transparency’s sake.  Disclosure rules (like nutrition labels, for instance) can and should be used to help people make better decisions than they would’ve otherwise made.

Continue reading

‘The Week in Health Law’ Podcast

By Nicolas Terry and Frank Pasquale

twihl 5x5

Our return guest this week is Wendy Parmet, Matthews Distinguished University Professor of Law, Professor of Public Policy and Urban Affairs, Director of the Program on Health Policy and Law, and Associate Dean for Interdisciplinary Education and Research Support at Northeastern University School of Law.  Professor Parmet is a leading voice internationally on cutting edge issues in public health.

In the opening, lightning round, Nic and Frank discussed:
1) Zubik v. Burwell, and the long line of First Amendment cases in the area.
2) The FTC’s new interactive tool for mobile apps.
3) The Part 2 proposed rule, and AMIA’s comment.
4) In the series Frontiers in the Financialization of Health Care, mortgages for expensive treatments, and crowdfunded funerals.

Our focus on Flint, Michigan this week featured Wendy’s insightful work on solidarity in bioethics, and “invisible victims” of public health failures. We also discussed the Docs v. Glocks saga, and the limits of regulation of professional speech.

And finally, attention all listeners: Northeastern will be hosting a conference on the future of public health law this Friday, and Wendy’s book “Welcoming Newcomers” will be out this Fall!

The Week in Health Law Podcast from Frank Pasquale and Nicolas Terry is a commuting-length discussion about some of the more thorny issues in Health Law & Policy. Subscribe at iTunes, listen at Stitcher RadioTunein and Podbean, or search for The Week in Health Law in your favorite podcast app. Show notes and more are at TWIHL.com. If you have comments, an idea for a show or a topic to discuss you can find us on twitter @nicolasterry @FrankPasquale @WeekInHealthLaw

Monday, 4/11, HLS Health Law Workshop with Nathan Cortez

HLS Health Law Workshop: Nathan Cortez

April 11, 2016, 5-7 PM
Hauser Hall 105
Harvard Law School, 1575 Massachusetts Ave., Cambridge, MA 02138

Download the Presentation: “Regulation by Database”

Nathan Cortez is Associate Dean for Research and Associate Professor in Dedman School of Law at Southern Methodist University. He teaches and writes in the areas of health law, administrative law, and FDA law.  His research focuses on emerging markets in health care and biotechnology. He has become one of the world’s leading legal scholars on medical tourism, patient mobility, and cross-border health insurance.

His research also addresses mobile health technologies, how to regulate innovations that disrupt static regulatory regimes, the First Amendment restraints on FDA regulation (including FDA’s graphic tobacco warnings), immigration federalism, and alternative modes of regulation.

Monthly Round-Up of What to Read on Pharma Law and Policy

By Ameet Sarpatwari and Aaron S. Kesselheim

Each month, members of the Program On Regulation, Therapeutics, And Law (PORTAL) review the peer-reviewed medical literature to identify interesting empirical studies, in-depth analyses, and thoughtful editorials on pharmaceutical law and policy.

Below are the papers identified from the month of March. The selections feature topics ranging from the characteristics and follow-up of post-marketing studies or conditionally authorized medicines in the European Union; to changes in prescription drug, over the counter drug, and dietary supplement use among older adults in the United States; to an assessment of the logic of Amarin’s off-label promotion of Vascepa. A full posting of abstracts/summaries of these articles may be found on our website.

  1. Hey SP, Kesselheim AS. An Uninformative Truth: The Logic of Amarin’s Off-Label Promotion. PLoS Med. 2016 Mar 15;13(3):e1001978.
  2. Hoekman J, Klamer TT, Mantel-Teeuwisse AK, Leufkens HG, De Bruin ML. Characteristics and follow-up of post-marketing studies of conditionally authorised medicines in the EU. Br J Clin Pharmacol. 2016 Mar 18. [Epub ahead of print].
  3. Kapczynski A. Free Speech and Pharmaceutical Regulation-Fishy Business. JAMA Intern Med. 2016 Mar 1;176(3):295-6.
  4. Massey PR, Wang R, Prasad V, Bates SE, Fojo T. Assessing the Eventual Publication of Clinical Trial Abstracts Submitted to a Large Annual Oncology Meeting. 2016 Mar;21(3):261-8.
  5. Qato DM, Wilder J, Schumm LP, Gillet V, Alexander GC. Changes in Prescription and Over-the-Counter Medication and Dietary Supplement Use Among Older Adults in the United States, 2005 vs 2011. JAMA Intern Med. 2016 Mar 21. [Epub ahead of print]
  6. Yeh JS, Sarpatwari A, Kesselheim AS. Ethical and Practical Considerations in Removing Black Box Warnings from Drug Labels. Drug Saf. 2016 Mar 21. [Epub ahead of print]

Treasury Targets Corporate Inversion, Pfizer-Allergan Deal Falls Through

By Dalia Deak

The Treasury Department published regulations on Monday that took aim at corporate inversions – and, they hit their mark. Two days later, the merger of pharmaceutical giants Pfizer and Allergan, the largest planned inversion in history of the pharmaceutical industry, fell through.

The temporary and proposed regulations put forth on Monday make it more difficult for U.S.-parented multinational groups to change their tax residence to a low-tax country. This practice, the Treasury noted, is typically not to grow the underlying business or pursue other commercial benefits that may arise, but primarily to reduce their taxes. Companies will often follow up corporate inversions with another tactic—earnings stripping. This is where the company will seek to further minimize U.S. taxes by paying deductible interest to the new foreign parent or its affiliates in the low-tax country.

Specifically, the regulations attempt to curb inversions and earnings stripping by doing the following:

  • Limiting inversions by disregarding foreign parent stock attributable to certain prior inversions or acquisitions of US companies (under section 7874);
  • Targeting transactions that increase related-party debt that does not finance new investment in the US (under section 385); and
  • Allowing the IRS on audit to divide a purported debt instrument into part debt and part stock (under section 385).

Continue reading

Webcast: Dennis on Precision Medicine and Cancer Pathology

The Regulatory Science Series at University of Arizona

presents

Eslie Dennis, MD,
Vice President and Head Global Medical Affairs Ventana Medical Systems, Inc., a member of Roche Group

speaking on 

“Cancer, Pathology, and Precision Medicine:  Virchow Revisited Through Grogan’s Lens”

Available live at 3PM Eastern Apr 6 and archived at https://goo.gl/NGEBPt

From Chance to Choice to Court

[Cross-posted from the Huffington Post Blog]

By Dov Fox

It used to be that whether you got the child you wanted — or one you hadn’t planned on — was left to cosmic fate or the randomness of reproductive biology. Now, new powers of reproductive medicine and technology promise to deliver us from the vagaries of the natural lottery.

The likes of voluntary sterilization and embryo screening give people who can afford them greater measures of control over procreation. Except, that is, when reproductive professionals make mistakes that frustrate efforts to pursue or avoid pregnancy or parenthood.

When, for example — just a few recent cases — a pharmacist fills a woman’s birth control prescription with prenatal vitamins. Or when a fertility clinic implants embryos carrying the hereditary disease that a couple underwent in vitro fertilization (IVF) to screen out. Just this week comes another report of losing IVF embryos.

Continue reading