What types of counsel have clients been coming to Buchanan Ingersoll & Rooney PC (Buchanan) for?
JP: In the early 2010s, I saw a lot of product liability and drug pricing issues within the litigation context. I have seen a shift regarding the latter from more opportunistic private plaintiffs to government entities at the state and federal levels bringing litigation against pharmaceutical companies, typically under antitrust and consumer protection statues. Additionally, the administration shift has brought on a few changes. Under Trump, there was a framework for addressing drug pricing issues that the Biden administration has taken up a notch with certain initiatives like Build Back Better.
EA: In 2022, we will see a dramatic uptick in compliance activities as authorities start to take action that has been delayed due to Covid-19.
You mentioned previously that bipartisan efforts to reduce drug pricing encourage companies to generate innovative technologies. To what extent does this sentiment still hold true?
EA: Innovation remains critical – 90% of units sold are generics with prices on the floor. The question becomes how to convert your sunken cost into a value-add, and the answer is technology. While people focus on getting FDA approval, investors also want to know how their investment will generate returns. Buchanan has been spending time with clients to understand how payers function, how clinical trials can be decentralized to reduce overall costs, and ultimately how to get something of value to the market.
All the polling numbers show that patients care primarily about reducing their out-of-pocket costs. Any development must start at this point, focusing on reducing costs for buyers while still making a return for their investors through delivering a value-add to the market. The best way to do so is to leverage innovative technology that increases operational efficiency.
JP: The failure to address drug pricing at the federal level has led to interesting developments. Many states are trying to independently regulate, as demonstrated by the approximately 500 drug pricing bills introduced by state legislators over the past year, a handful of which have been enacted. These states are looking to force drug price transparency, cap price increases for the state payers, and regulate PBMs. The result is a complicated patchwork of regulation around the country, and one of the perverse side effects of this is that creating transparency in the system has led to higher prices.
The problem of not having federal legislation in place is far bigger than anyone recognizes and has gotten worse throughout the pandemic. We continue to guide and support clients at every level of litigation as this complex problem grows.
What will be the impact of the FDA and other enforcement agencies gradually returning to pre-pandemic levels of targeting compliance?
EA: As the FDA returns to live inspections instead of virtual, there will be certain complications. For example, it is unclear whether FDA personnel will be willing to enter an area with active Covid-19 cases. While the agency is working on potential solutions, such as increasing the number of post approval automatic manufacturing changes and changes to CMC guidelines, there is also a growing movement to bring manufacturing capabilities back to the US to develop a more localized supply chain. This will require a complete retooling of manufacturing companies, but it presents opportunities for the American industry and economy. At the same time, companies are contemplating why they should set up facilities in the US where the FDA would spend weeks conducting inspections, whereas if they were to set up in China or India, the FDA would provide advanced notice before inspection and would be present for no more than a week.
What can we expect from Buchanan within the life sciences space over the next few years?
JP: Buchanan would like to continue growing and investing in the life sciences space as part of the company’s overall growth strategy. We have the team, experience, and client base to be one of the preeminent life sciences firms in the US.
EA: Buchanan’s Life Sciences Industry Group is one of the most diverse groups in the firm and probably the country. This make up allows us to engage with various clients, as individuals like to work with people they connect and feel comfortable with. We also continue to hire attorneys who have deep government agency and compliance experience enabling our clients to benefit from those perspectives.