Members of Sidley Austin’s Global Life Sciences Industry Team recently reviewed litigation, regulatory, and enforcement trends in their respective fields. Our Team recommends that legal departments in the life sciences industry manage risks and take advantage of business opportunities by taking the following ten steps in 2011:

  1. Increase clinical trial oversight. Focus on potential kickback, Foreign Corrupt Practices Act, and Good Clinical Practice liability, especially in developing countries. Strengthen agreements with sites and contract research organizations and increase monitoring.
  2. Contain major liability in your corporate structure. Examine your corporate structure to determine whether core assets are sufficiently insulated from large judgments or penalties.
  3. Prepare to use comparative effectiveness research as a sword and a shield. The U.S. government and an expanding number of private payors will soon begin to use CER to make coverage and reimbursement decisions. Take stock of your current CER and expand or modify your strategy now.
  4. Leverage international treaty rights. Structure new cross-border investments in line with investment treaty protections. Review your global supply chain to rationalize input costs and integrate treaty rights into strategies to address regulatory barriers.
  5. Avoid claims creep. For each product, review the authorized indications by country and compare with the key marketing claims currently being made. Make sure each claim can be traced back to the approval or marketing authorization for the product.
  6. Protect corporate officers against new initiatives to impose liability on individuals. Strengthen the compliance infrastructure. Incorporate into the compliance program elements that are intended to prevent violations from occurring and correct any violations that have occurred.
  7. Learn the new life sciences commercial bribery pot holes. Incorporate Dodd-Frank, UK, AIC, and Southeast Asia initiatives into training and compliance programs.
  8. Consider preemption—and plan for it. Do not assume that Wyeth v. Levine is the death knell for all preemption defenses in litigation. Plan a regulatory strategy to build better preemption defenses.
  9. Monitor and engage in efforts to revisit healthcare reform and to pass the next round of user fee reauthorizations. Develop strategies to deal with the Independent Payment Advisory Board and the Center for Medicare and Medicaid Innovation, competitive-bidding, CMS-FDA parallel review, and new requirements for drug and device safety.
  10. Manage punitive damage exposure. Conduct early litigation audits to assess, and proactively address, conduct that could lead to punitive awards.