Drug prices have become front-page news around the world, leading to blunt criticisms of the pharmaceutical and biologic industries. These criticisms, which all too often fail to recognize the value of the therapies, are fueling a heated policy debate and can have major legal implications for the pharmaceutical and biologics industry. Lawyers and policy advisors from Sidley’s Global Life Sciences team are at the center of the discussion. We are closely following the developments as they happen and sharing our knowledge about this rapidly evolving issue. Through new updates, client alerts, events and speaking engagements, we analyze drug pricing policy and legal developments impacting pharmaceutical and biologics manufacturers in the United States and abroad.
Global Drug Pricing
How We Can Help
- Protecting your ability to innovate. We serve a wide range of life sciences clients, from developers of innovative medicines such as biotechnology medicines, cell and gene therapies, to developers of vaccines, medical devices, and diagnostics. With an eye toward existing and emerging pricing regulation, we help clients develop strategies of advocacy, business considerations and legal arguments that allow them to proactively and constructively engage in policy discussions on fair pricing at the national and international level. This includes helping them negotiate pricing and reimbursement for their products.
- Supporting your pricing decisions. We work closely with our team of in-house economists who help us develop methodologies that can further support – and strengthen – our clients’ pharmacoeconomic assessments of their therapies, in compliance with antitrust/competition laws and consistent with managed entry agreements and other access schemes offered to payers. Our lawyers also help clients explain and defend the value of their health technologies and the fairness of their pricing decisions.
- Advising on requests for disclosure of confidential development costs. Some regulatory systems require companies to provide internal financial documentation related to the development costs of health technologies. Such regulations, however, mainly focus on “ex post out-of-pocket success costs” such as research and development, and do not include “ex ante risks”, such as failed clinical trials. All too often, a health technology does not obtain marketing approval. Even if it does, reimbursement is becoming increasingly difficult to secure. We counsel companies on how to respond to requests for disclosure of confidential company information, using the full spectrum of costs and risk factors. We also help them defend against excessive pricing allegations based on ex post cost assessments.
A sampling of our experience includes advising:
- Litigation counsel of record in every major drug pricing litigation matter in the U.S., including most favored nations, 340B, and Canadian importation.
- Dozens of U.S. government price reporting and transparency representations, including strategic counseling, restatements, regulator interactions, and dispute resolution.
- Multiple major pharmaceutical manufacturers in government enforcement and False Claims Act matters involving drug pricing, obtaining declinations from the Department of Justice and other favorable resolutions.
- Drafting federal legislation and numerous proposals addressing value-based discounting arrangements in the U.S.
- A global healthcare company that specializes in lifesaving medicines and technologies for infusion, transfusion and clinical nutrition on state and federal drug pricing transparency laws and related issues, including government-conducted audit of 340B program compliance.
- An American pharmaceutical company on the implications of the U.S. Government’s exercise of its “march-in rights” under the Bayh Dole Act.
- Several multinational pharmaceutical companies on their antitrust compliance matters in China, particularly in connection with their pricing strategies.
- One of the largest multinational pharmaceutical and life sciences companies on class actions filed against the client in various jurisdictions relating to average wholesale prices.
- A major biopharmaceutical company in Switzerland that is focused on an innovative therapy for certain genetic diseases on a broad range of pricing-related advice, including on: early access program; importation of unauthorized product; pricing and reimbursement procedures before the Swiss Federal Office of Public Health; pricing and reimbursement negotiations with health insurers; appeal procedures against one health insurer; and unfair competition practices by health insurers.
- Several multinational companies on governance and procedures pertaining to price-setting in a joint venture / third party distribution context. This included advice on external reference pricing and compliance with antitrust/competition laws.
- A global orphan drug company in an investigation by several national competition authorities in the EU against allegations that prices of a newly authorised drug can be regarded as “excessive” even where the price is to be negotiated with powerful pricing and reimbursement authorities. This is the first case of its kind in the EU.
- A Brussels-based trade association on the pricing-related implications of the European Commission’s Pharmaceutical Strategy and IP Incentives Review, and the impact on the rights and exclusivities currently enshrined in EU law, including: orphan market exclusivity, regulatory data protection, and supplementary protection certificates.
- A Brussels-based trade association on the IP provisions pursued by the EU in its Free Trade Agreements, including in the EU-UK Agreement (Brexit).
- A global medical devices company on dealing with competition law-related issues when health insurance companies are jointly purchasing the company’s product, seeking lower prices.
- Multiple companies on supplying medicinal products to patients before reimbursement prices have been agreed in EU Member States.
- Several pharmaceutical companies in a ground-breaking case against the Dutch government, regarding unlimited reimbursement of pharmacy-compounded products aimed at replacing expensive authorized drugs and blocking them from the market. Replacement compounding is a serious concern, aggravated by COVID-19, because it bypasses all IP and regulatory exclusivity rights. Sidley was hired because of our reputation for handling matters with far-reaching industry implications and the likelihood that the case could be referred to the Court of Justice of the EU (CJEU), where Sidley has successfully litigated several cases.