AGG Food and Drug Newsletter - April 2016

by Arnall Golden Gregory LLP
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Arnall Golden Gregory LLP's (AGG) Food and Drug Newsletter is a monthly update of legal and regulatory issues that affect the FDA-regulated community, including regular updates on legislative initiatives from AGG’s Washington, DC office, and articles from members of AGG outside the Food and Drug Practice.

In this Issue

Industry Insights


PHARMACEUTICALS

You Can Pay Now or You Will Pay Later: FDA Issues a Warning Letter to a Pharmaceutical Company for a Misleading Patient Co-Pay Assistance Voucher
By: Alan G. Minsk and Elizabeth A. Mulkey

On March 29, 2016, the Food and Drug Administration’s Office of Prescription Drug Promotion (OPDP) issued a Warning Letter to a pharmaceutical company for a patient co-pay assistance voucher that failed to include risk information, omitted material facts by not providing the full indication, and was not submitted on a Form FDA-2253. Despite the uncertainty surrounding the agency’s enforcement of off-label promotional activities, particularly in light of recent court cases, OPDP is not sitting idly. This is the second enforcement letter that OPDP has issued for unlawful prescription drug promotion in 2016.  More >

SEC Charges Biotech Company and Its Officers with Misleading Investors by Failing to Disclose FDA Concerns and Recommendations
By: Alan G. Minsk and W. Jerad Rissler

On March 29, 2016, the Securities and Exchange Commission (SEC) announced charges against a biotech company and three of its officers for securities fraud. The company has agreed to pay $4 million to resolve the charges without admitting or denying the allegations. The SEC is proceeding against the officers of the company and seeking disgorgement, permanent injunctions, and officer-and-director bars. Paul G. Levenson, Director of the SEC’s Boston Regional Office, summed up the crux of the case as follows: “Companies must be forthcoming about their communications with regulators so investors can make informed investment decisions while knowing what challenges may lay ahead.”  More >


COSMETICS

When Is Natural Unnatural? When It’s Not: The Federal Trade Commission Takes Exception to “All Natural” Claims
By: Anuj Desai and Alan G. Minsk

In the 1975 song, “Natural Mystic,” legend Bob Marley sang “There’s a natural mystic blowing through the air – I won’t tell no lie.” Channeling Marley, the Federal Trade Commission recently took enforcement action against four personal care product companies, which sold skincare products, shampoos, and sunscreens online, for claiming their products were “all natural” or “100% natural” when, in fact, they contained synthetic ingredients. The four companies agreed to proposed settlement orders, while the FTC has issued a complaint against a fifth. The Commission said the companies cannot make similar misrepresentations in the future and must have “competent and reliable evidence” to substantiate any ingredient-related, environmental, or health claims. For some claims, the companies must have scientific evidence, such as tests, analyses, research, or studies that have been conducted and evaluated objectively by qualified individuals, using generally-acceptable procedures in the industry, which should lead to accurate and reliable results.  More >


NEWS FROM WASHINGTON

CMS Issues Proposed Rule to Establish a Medicare Part B Drug Pricing Demonstration
By: Alan K. Parver and Leah M. Stone

On March 11, 2016, the Centers for Medicare & Medicaid Services (CMS) published in the Federal Register a proposed rule that establishes a demonstration to test alternative drug payment approaches under the Medicare Part B program. CMS intends for the proposed demonstration to incentivize providers to prescribe the most effective drugs and to link payments with patient outcomes.  More >

Abbott Laboratories Prevails in False Claims Act Case
By: Sara M. Lord

On April 7, 2016, following a three-week trial and after only three hours of deliberations, a federal jury in Dallas, Texas found that Abbott Laboratories had not violated the False Claims Act (FCA) when it marketed bile duct stents for off-label uses in vascular procedures. The qui tam lawsuit, which was filed by a former salesman for Abbott’s predecessor, Guidant, and in which the government did not intervene, accused the company of effectively using off-label marketing to test the device on vascular patients without their informed consent. Because nearly all the patients who received the stents were elderly, the AARP Foundation acted as co-counsel in support of the lawsuit. More >

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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