DOJ Filing Reawakens Fraud-On-The-FDA Theory Of Liability

On June 3, the U.S. Department of Justice Civil Division’s Washington, D.C., office filed a statement of interest in a relator’s action, arguing that “[c]onduct giving rise to a regulatory violation can also give rise to” False Claims Act liability.

The case is U.S. ex rel. Patricia Crocano v. Trividia Health Inc., before the U.S. District Court for the Southern District of Florida.

Specifically, the DOJ requested “that the ruling not foreclose the possibility that, under certain circumstances,” conduct that violates the Federal Food, Drug and Cosmetic Act or U.S. Food and Drug Administration regulations “could be material to the government’s payment decisions and provide a basis for FCA liability assuming all necessary FCA elements are demonstrated,”[3] colloquially known as “fraud on the FDA.”

This filing makes clear the DOJ’s decision to reawaken a theory of liability thought to be dead.

To read the full text of this article by Duane Morris attorneys Eric Breslin, Frederick R. Ball and Brittany Pagnotta, originally published in Law360, please visit the firm website.

Coordinating IP and Regulatory Filings Can Minimize the Risk of Inequitable Conduct Before the PTO

On July 29, 2022, the U.S. Patent and Trademark Office (PTO) published a Notice on the Duties of Disclosure and Reasonable Inquiry During Examination, Reexamination, and Reissue, and for Proceedings Before the Patent Trial and Appeal Board. The notice was part of the PTO’s response to President Joe Biden’s July 2021 Executive Order on Promoting Competition in the American Economy. It also answered Congress’ call for PTO action following the Federal Circuit’s September 2021 ruling that a drug formulation patent was unenforceable based on a drug manufacturer’s inconsistent disclosures to both the PTO and the FDA. In view of the notice, companies should review the interface between their IP and regulatory functions to confirm that their interoperation (or lack thereof) does not run afoul of a patent applicant’s duties of disclosure and reasonable inquiry to the PTO.

To read the full text of this Duane Morris Alert, please visit the firm website.

The Other Side of the Coin: Diligent Patent Prosecution Does Not Lead to Unreasonable Delay and Application of Prosecution Laches

The backlog of pending patent applications at the USPTO is growing. As of May 2022, the USPTO estimates an average pendency of approximately 20 months from filing to the mailing of a first office action. Applicants may be tempted to take advantage of and exploit the patent system to unreasonably delay prosecution and extend the patent term of a patent family member far beyond the lifetime of the original parent application. To prevent this gaming of the patent system in the hopes of extending patent term and to prevent prejudice to others, the equitable affirmative defense of prosecution laches may be raised to render an asserted patent unenforceable.

To read the full text of this Duane Morris Alert, please visit the firm website.

Silence Is Not Necessarily Golden for Negative Patent Claim Limitations

During the prosecution of a patent application before the U.S. Patent and Trademark Office, claim amendments that introduce a negative limitation―the exclusion of a particular element or feature from the scope of the claims―may be dispositive in distinguishing the instant application from the prior art and advance the application toward allowance. However, the introduction of negative limitations may raise questions and issues as to whether the claims satisfy the written description requirement under 35 USC §112(a). Recently, the U.S. Court of Appeals for the Federal Circuit elaborated upon what satisfies the written description requirement with respect to the recitation of negative claim limitations.

To read the full text of this Duane Morris Alert, please visit the firm website.

FTC Publishes Proposed Changes to Guides Concerning the Use of Endorsements and Testimonials in Advertising

The Federal Trade Commission (FTC) has announced proposed changes to its Endorsement Guides, 16 CFR Part 255, which assist entities in conforming endorsements and testimonials in advertising to the requirements of Section 5 of the FTC Act. FTC continues to review the guides, first published in 1980, as part of its ongoing regulatory review process.

To read the full text of this Duane Morris Alert, please visit the firm website.

DOJ Clarifies Position on Fraud-on-the-FDA Theory of False Claims Act Liability

On June 3, 2022, the Civil Division of the Department of Justice filed a statement of interest in a relator’s action in the Southern District of Florida, arguing that “[c]onduct giving rise to a regulatory violations can also give rise to [False Claims Act] liability.” Specifically, requesting “that the ruling not foreclose the possibility that, under certain circumstances, conduct giving rise to violations of the [Federal Food, Drug and Cosmetic Act] or FDA regulations could be material to the government’s payment decisions and provide a basis for FCA liability assuming all necessary FCA elements are demonstrated,” also known as “fraud on the FDA.”

To read the full text of this Alert, please visit the firm website.

FDA’s Guidance Creates Administrative Burden for Animal Drug Compounding Documentation

On April 13, 2022, the FDA issued Guidance for Industry #256 about the enforcement policy regarding the compounding of animal drugs from bulk drug substances by or under the direct supervision of veterinarians or pharmacists in either state-licensed pharmacies or federal facilities. FDA has spent several years and gone through multiple iterations trying to develop new industry guidance on compounding animal medications. While changes have been made from previous iterations, FDA has implemented significant administrative burdens for documentation of clinical need and limitations on drug substances that can be compounded for office use.

FDA has taken the current position that drugs compounded from bulk substances violate the Federal Food, Drug and Cosmetic Act (FD&C Act) because they are not approved or indexed, are not made according to current good manufacturing practice and cannot satisfy the FD&C Act’s adequate directions for use provision. However, FDA has generally refrained from taking enforcement action against animal drugs compounded from bulk drug substances under certain circumstances when no other medically appropriate treatment options exist. Especially for animal drugs, compounding plays a crucial role in providing medically appropriate treatments for a wide variety of species of all different shapes and sizes―specifically, those for whom a single dosage form or level will not be medically appropriate.

To read the full text of this Duane Morris Alert, please visit the firm website.

Rick Ball to Speak at FDLI’s Introduction to Drug Law and Regulation Event

Duane Morris partner Rick Ball will be a speaker at FDLI’s “Introduction to Drug Law and Regulation,” a virtual course to be held on April 28, 2022. Mr. Ball’s topic will be “Violations and Enforcement.”

About the Program

Explore the essentials of drug law and regulation and gain a comprehensive understanding of the administrative agencies that impact this industry. Learn about patent and exclusivity issues, Rx to OTC switches, Good Manufacturing Practices (GMP), advertising and promotion, compliance, enforcement, and related issues. Case studies, hypotheticals, and ample time for Q&A are provided.

To learn more about this program and register, please visit the FDLI website.

FDA Final Guidance on Initiating Voluntary Recalls: Be “Recall Ready”

On March 4, 2022, FDA issued a final guidance to industry and FDA staff regarding the initiation of voluntary recalls under 21 CFR part 7, subpart C. The guidance applies to voluntary recalls of products subject to FDA’s jurisdiction, including any:

    1. Food, drug and device (human or animal use);
    2. Cosmetic and biological product (human use);
    3. Tobacco product;
    4. Item subject to a quarantine regulation under 21 CFR part 1240; and
    5. Devices that are electronic products regulated as radiology devices (subject to 21 CFR part 892) but not electronic products subject to 21 CFR parts 1003 and 1004.

In short, the final guidance clarifies FDA’s recommendations on how a firm should be prepared to facilitate the timely initiation of voluntary recalls, steps a firm should take if there is an indication of a problem with a distributed product and how to initiate voluntary recalls. The final guidance also explains how FDA works with firms to initiate a voluntary recall.

To read the full text of this Duane Morris Alert, please visit the firm website.

District Court of Delaware Rules for Generic Pharma’s Use of Skinny Label, but Permits Induced Infringement Suit to Proceed Against Insurer

In the recent opinion of Amarin Pharma v. Hikma Pharms. U.S., the District Court of Delaware dismissed Amarin’s complaint against Hikma for induced infringement of three patents when Hikma used a skinny label to carve out a patented indication. However, the court held that Amarin sufficiently pled to proceed with the complaint against an insurer, Health Net, for induced infringement.

To read the full text of this Duane Morris Alert, please visit the firm website.

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The opinions expressed on this blog are those of the author and are not to be construed as legal advice.

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