On Access and Accountability — Two Supreme Court Rulings on Generic Drugs

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Perspective

Marcia M. Boumil, J.D., LL.M., and Gregory D. Curfman, M.D.

N Engl J Med 2013; 369:696-697August 22, 2013DOI: 10.1056/NEJMp1308368

Article

In June, the U.S. Supreme Court issued two rulings regarding the marketing of generic drugs that may alter the pharmaceutical business landscape. First, in Federal Trade Commission v. Actavis, the Court confronted the law governing a controversial pharmaceutical marketing practice known as reverse payment agreements, or pay for delay.1 This practice occurs when a generic drug company identifies a vulnerable patent held by a brand-name drug manufacturer and seeks approval from the Food and Drug Administration (FDA) for a generic version before the patent expires, provoking a lawsuit for infringement. The two companies then forge a settlement whereby the brand-name company pays the generics firm to delay commercialization of its product. Extending the monopolies of brand-name companies in this way reportedly costs consumers more than $3.5 billion per year.2 Since such settlements suppress competition, the Court sent the case back to the district court to be evaluated according to the “rule of reason,” one of the standards for determining whether an action violates antitrust law.

Second, in Mutual Pharmaceutical v. Bartlett, the Court ruled that generics manufacturers are substantially immune from civil claims regarding injuries caused by their products — a decision that eliminates a primary incentive for...

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Thousands of doctors practicing despite errors, misconduct

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Dr. Greggory Phillips was a familiar figure when he appeared before the Texas Medical Board in 2011 on charges that he'd wrongly prescribed the painkillers that killed Jennifer Chaney.

The family practitioner already had faced an array of sanctions for mismanaging medications — and for abusing drugs himself. Over a decade, board members had fined him thousands of dollars, restricted his prescription powers, and placed his medical license on probation with special monitoring of his practice.

They also let him keep practicing medicine.

In 2008, a woman in Phillips' care had died from a toxic mix of pain and psychiatric medications he had prescribed. Eleven months later, Chaney died.

Yet it took four more years of investigations and negotiations before the board finally barred Phillips from seeing patients, citing medication errors in those cases and "multiple" others.

"If the board had moved faster, my daughter would still be alive," says Chaney's mother, Bette King, 72. "They knew this doctor had all these problems … (and) they did nothing to stop him."

Mari Robinson, executive director of the Texas medical board, says the Phillips case took "longer than normal, but we followed what we needed to do (by law)." Phillips could not be reached for comment.

Despite years of criticism, the nation's state medical boards continue to allow thousands of physicians to keep practicing medicine after findings of serious misconduct that puts patients at risk, a USA TODAY...

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UPS Won’t Insure Spouses Of Some Employees

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Partly blaming the health law, United Parcel Service is set to remove thousands of spouses from its medical plan because they are eligible for coverage elsewhere.

Many analysts downplay the Affordable Care Act’s effect on companies such as UPS, noting that the move is part of a long-term trend of shrinking corporate medical benefits. But the shipping giant repeatedly cites the act to explain the decision, adding fuel to the debate over whether the law erodes traditional employer coverage.

Rising medical costs, “combined with the costs associated with the Affordable Care Act, have made it increasingly difficult to continue providing the same level of health care benefits to our employees at an affordable cost,” UPS said in a memo to employees.

The company told white-collar workers two months ago that 15,000 working spouses eligible for coverage at their own employers would be excluded from the UPS plan in 2014. The Fortune 100 firm expects the move, which applies to non-union U.S. workers only, to save about $60 million a year, said company spokesman Andy McGowan.

UPS becomes one of the highest-profile employers yet to bar working spouses from the company plan. Many firms already require employees to pay a surcharge for working-spouse medical coverage, but some are taking the next step by declining to include them at all, consultants say.

“They are simply saying to the spouse outright, ‘If you have coverage somewhere else you are not eligible...

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NH Supreme Court outlines intoxication defense and other parameters of workers' comp claims

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CONCORD, New Hampshire — The New Hampshire Supreme Court has ruled that intoxication must be determined to be the cause of an accident for it to be a defense against a workers' compensation claim.

The court sent Thomas Phillips' case back to the state Compensation Appeals Board for a finding on whether his intoxication caused him to fall from a tree while cutting a branch and suffer injuries that left him a quadriplegic.

Phillips received a break in his rent from his landlords and next-door neighbors — Norman and Diane Crocker of Danville — in return for doing maintenance work around both houses.

When he was hospitalized after the 2006 fall, his blood alcohol content was 0.27, more than three times the legal limit to drive.

A Department of Labor hearing officer awarded Phillips benefits, but the Compensation Appeals Board reversed that ruling in 2010, saying Phillips was drunk. But the board failed to specifically say that Phillips' intoxication was the cause of his fall and injuries.

"The CAB may have erroneously believed that the petitioner's intoxication alone was the enough to deny him benefits," Justice James Bassett wrote, in the unanimous ruling released Wednesday. "Our concern on this score is heightened by the fact that there were no witnesses to the accident and that there was evidence the accident may have occurred as a result of the tree branch snapping while (Phillips) was attempting to cut it."

Phillips' lawyer, Michael Mortimer, declined to...

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US Supreme Court Asked to Review MSP Preemption Issue

The US Supreme Court has been asked to review a claim on behalf of an injured worker who asserts that the Medicare Secondary Payer Act did not preempt State law (i.e.. Texas) that required a Workers' Compensation claimant to obtain preauthorization from relevant insurance carriers before incurring certain medical expenses. The Fifth Circuit Court of Appeals held that Medicare's conditional payment for a workers surgeries did not render the  state law mandate for  preauthorization requirements "moot."

A Writ of Certiorari was filed with the US Supreme Court on Aug. 8, 2012 and a response is due September 11, 2013 

Guadalupe Caldera v. Insurance Company of the State of Pennsylvania, US Supreme Court Docket No. 12-40192. Case below, 716 F 3d 861, Docket No, 12-40192, 5th Cir Ct Appeals, Decided May 14, 2013.

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Jon L.Gelman of Wayne NJ is the author NJ Workers’ Compensation Law (West-Thompson) and co-author of the national treatise, Modern Workers’ Compensation Law (West-Thompson). For over 4 decades the Law Offices of Jon L Gelman  1.973.696.7900  jon@gelmans.com  have been representing injured workers and their families who have suffered occupational accidents and illnesses.

Colorado Exchange Releases Health Insurance Rates

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Colorado released its Obamacare insurance rates on Friday, joining 13 states and the District of Columbia in making rates public.

The state earlier made the call to be a clearinghouse exchange, rather than an active purchaser, and so, it has approved all 242 health plans submitted for sale on its marketplace, Connect for Health Colorado.  Thirteen carriers will offer 150 plans in the individual marketplace, and 92 for small businesses. The plans go on sale Oct. 1 for coverage that starts Jan. 1. Colorado also approved 299 plans for sale outside its exchange and prices for them.

“We’re very pleased with the number of carriers and plans,” Deputy Insurance Commissioner Peg Brown told the Connect for Health board Monday. “It represents a wide variety of choice … and healthy competition in the Colorado insurance marketplace overall,” Brown said.

Members of the exchange board greeted Brown’s announcement with applause but did not comment further.

The rates came out  more than two weeks later than the state’s Division of Insurance had initially promised.

So where do the Colorado rates fall in the ongoing debate about whether prices on the exchanges are reasonable? It might be the rare “just right” state.

Prices range from $135 a month on the low end to almost $1,000 a month for the most comprehensive coverage with some variation depending on a person’s age, where they live and whether they use...

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Ronald L. Motley 1944 - 2013

With deep sadness we share the news of the passing of Ronald L. Motley.

"It is with the deepest sadness and most profound grief that I must share with you the news that our friend, colleague, mentor, partner and co-founder of Motley Rice, Ron Motley, has passed away.

"Like many of you, I started my career learning from Ron the ins and outs of fighting the asbestos industry. It was because of Ron’s passion, tenacity, intelligence and persistence that he was able to secure the first victory in favor of a plaintiff against an industry that had knowingly put people’s health in jeopardy for decades. That victory would be just one in the beginning of a respected law career that allowed him to be a pioneer for justice and warrior for social accountability.

"Ron’s passing is an incalculable loss for all those he devoted his life’s work to, whether it was people sick from asbestos poisoning, State Attorneys General taking on Big Tobacco, 9/11 family members seeking to bankrupt terrorism, or anyone else who wanted his or her day in court to redress injustice.

"As many of you experienced first-hand, Ron was many things. A true giant of the legal profession. A trail blazer and innovator. A charismatic master of the courtroom. A tenacious interrogator. But most of all, he was marked by unmatched courage in going after any wrongdoer, no matter how big and powerful, and by his bottomless well of compassion for those who have been wronged. He proudly lived his life as a trial lawyer.

"Ron left an extraordinary legacy. It is my commitment, even as we mourn, that we should all rise above our sadness and devote ourselves to carrying his legacy forward. Indeed, there is no better way we can celebrate Ron’s life and honor his memory than by redoubling our efforts to put the powerless on a level playing field with the powerful, to get them their day in court, and to win justice for all.

"Ron always valued the relationships that he had with you and your organization. Through partnerships and friendships, Ron was able to share his passion and talent with so many. He will be greatly missed and forever remembered.

"We will share arrangement details as they are made. We appreciate your thoughts and prayers for Ron's family, friends and colleagues during this time.

Joe

Joseph F. Rice | Attorney at Law | Motley Rice LLC