FTC Non-Compete Ban Set Aside Nationwide

On August 20, 2024, a Texas federal judge permanently barred the implementation of a controversial Federal Trade Commission (FTC) regulation that would have invalidated tens of millions of existing non-compete agreements and precluded the adoption of new covenants. We discussed the FTC’s non-compete regulation earlier this year. The decision comes as a relief to employers that feared the FTC’s regulation would have made it nearly impossible to prevent unfair competition and protect employers’ investment in its employees and against the misappropriation of confidential and proprietary information. Squire Patton Boggs attorney Laura Lawless discusses the decision and its implications on our Employment Law Worldview Blog, which you can read here.

Singapore Issues Game-Changing Synthetic Data Guide for AI

By Charmian Aw and Brendan Lai on August 23, 2024 Posted in AI, Singapore

On July 15, 2024, Singapore’s Personal Data Protection Commission Singapore (PDPC) released a Proposed Guide on Synthetic Data Generation (Guide). The Guide is a resource within the Privacy Enhancing Technology (PET) Sandbox which aims to assist organisations in understanding the techniques and potential applications of Synthetic Data generation, particularly in the context of artificial intelligence (AI) without compromising sensitive data.

In healthcare, where patient privacy and data accessibility are critical concerns, synthetic data presents a promising solution. For instance, it:

Preserves privacy: With strict privacy and confidentiality necessary to protect highly sensitive and data, these rules often make data sharing difficult, slowing down research and innovation. Synthetic data offers a way around these challenges by mimicking the trends of real healthcare data without linking to actual patients. This allows healthcare organisations to avoid the complexities of data sharing agreements and privacy restrictions, thereby accelerating research and development while staying compliant.

Improves treatments: By simulating patient data, healthcare providers can evaluate the effectiveness and safety of treatments and tools without compromising patient privacy. This not only improves the accuracy of medical tools but also helps identify potential issues before they are used in clinical settings.

Enhances research and development: Synthetic data enhances the training and validation of machine learning models, particularly in medical imaging. This provides the ability to augment datasets with diverse and realistic images where real data is limited, thereby reducing costs and labour associated with annotating real images and allowing researchers to refine their models more effectively.

Enables predictive analytics and personalised medicine: Synthetic data is a valuable tool in predictive analytics which is crucial for personalised medicine. Machine learning models trained on synthetic data can more accurately predict how patients will respond to treatments, leading to more personalised and effective care strategies.

Reduces risks of data breaches: By mimicking real data without including personal information, synthetic data offers a secure alternative for organisations relying on data for insights.

Expands data use in education and research: Synthetic data’s benefits extend beyond its primary applications. It can be used for educational purposes, allowing students and professionals to practice on realistic scenarios without compromising patient confidentiality.

To learn more about Singapore’s Guide, please see our original blog post on our Privacy World blog.

Singapore Consults on Cybersecurity Guidelines for AI Systems

By Charmian Aw on August 15, 2024 Posted in AI, Cybersecurity, Data Protection, Singapore

As a digital technologies hub in the Asia Pacific region, Singapore is making a big push to advance Artificial Intelligence (AI) technologies across various sectors, including healthcare.

The promise of AI in managing Singapore’s ageing population and enhancing patient care and treatment more broadly cannot be overstated. This spans the ability to better predict and diagnose diseases, enable personalised medicine, and improve remote patient monitoring.

With that said, the threat of cyber-attacks and other threats pose very real risks to these AI-driven outcomes being fulfilled.

To address this issue, the Cybersecurity Agency of Singapore has published for public consultation, two proposed sets of guidelines for securing AI systems. The consultation closes on September 15, 2024.

To read more about this development in Singapore, please see our original blog post on our Privacy World blog.

Medicare Part D Preemption: Supreme Court Review Uncertain

By Michele Munk on August 5, 2024 Posted in 10th Circuit, 1st Circuit, 8th Circuit, Medicare Part D, U.S. Supreme Court

On July 29, 2024, Pharmaceutical Care Management Association (“PCMA”) filed an opposition to Oklahoma’s petition for writ of certiorari in the United States Supreme Court, seeking review of the Tenth Circuit decision PCMA v. Mulready, 78 F.4th 1183 (10th Cir. 2023). Oklahoma seeks review of both ERISA and Medicare Part D preemption.[1]

Mulready held that Medicare preempted Oklahoma’s Any Willing Pharmacy provision (“Challenged AWP”), which requires a Pharmacy Benefit Manager (“PBM”) to allow the participation of pharmacies into preferred pharmacy networks.[2] Mulready reasoned that Medicare Part D preemption is akin to field preemption and does not require an overlapping federal and state standard to conclude that the state law is preempted.[3] Applying field preemption, Mulready concluded that the Challenged AWP “detracts from the integrated scheme of [Medicare] regulations” by regulating Part D plans above what Medicare laws and regulations require, and as the state law did not concern licensing or plan solvency, it was preempted.

Mulready could have stopped there but doesn’t. Mulready further held that under a conflict preemption standard, the Challenged AWP would still be preempted for Medicare Part D plans because Medicare has its own Any Willing Pharmacy provision (“Medicare AWP”),[4] and other regulations[5] that require Medicare Part D plans (and associated PBM) to allow pharmacies to participate in standard pharmacy networks but does not require participation in preferred networks.

In Purdue Pharma, the Supreme Court Fires a Canon of Construction Through Non-Consensual Third-Party Releases (US)

By Squire Patton Boggs on July 16, 2024 Posted in Bankruptcy, U.S. Supreme Court

On June 27, 2024, the Supreme Court ruled in a 5-4 decision that a bankruptcy court does not have the statutory authority to discharge creditors’ claims against a non-debtor without the creditors’ consent (except in asbestos cases). The decision in Harrington v. Purdue Pharma settles a long-standing dispute in the bankruptcy world that will have significant impact on Purdue Pharma and its hundreds of thousands of creditors, and more generally on the bankruptcy practice itself. Squire Patton Boggs attorney Justin Cloyd discusses the case in detail on our Restructuring GlobalView blog, which you can read here.

A New Era in Healthcare Regulation & Compliance

By Kayla Mendez on July 11, 2024 Posted in Regulations, U.S. Supreme Court

Loper Bright Shifts Statutory Interpretation Powers Back to the Courts.

On June 28, 2024, the Supreme Court overturned the Chevron doctrine with its decision in Loper Bright Enterprises v. Raimondo. Under Chevron, courts have historically deferred to a federal agency’s interpretation of ambiguity in statutes that the agency administers. Courts premised Chevron deference on the notion that Congress implicitly delegated the interpretation to the agency.

In contrast, Loper Bright rejects Chevron’s assumption of implicit delegation: “When the best reading of a statute . . . delegates discretionary authority to an agency, the role of the reviewing court under the APA is, as always, to independently interpret the statute and effectuate the will of Congress.”

Loper Bright’s requirement for independent judicial judgment as to whether an agency acted within its authority granted by Congress will necessarily require courts to review agency interpretations on a case-by-case basis. A court may still defer to or “seek aid from” an agency’s interpretations and consider the agency’s “body of experience and informed judgment,” but courts will also employ far more discretion to disagree with an agency’s interpretation of statutory ambiguity. Now, more readily, a court may weigh “other information at its disposal” and potentially give increased weight to the perspectives of litigants and amici over agency expertise. Even where a court finds an agency’s interpretation reasonable, the court may still replace the interpretation with its own.

Some caution is in order, though, because the post-Chevron landscape will not be the same for all agencies. The Supreme Court acknowledged that there are statutes calling for greater degrees of deference in specific circumstances. For example, banking agencies receive great deference for their interpretations of federal banking law. This is not due to the across-the-board presumption, from Chevron, that the Supreme Court overturned. Rather, it was a judicial reaction to the specific concerns that Congress addressed in federal banking law. These statute-specific forms of deference tended to merge into Chevron over the years. But the underlying precedents are still there, and courts may revive these statute-specific deference doctrines. This possibility is particularly pertinent in healthcare, because, for example, the lower courts have long deferred to CMS interpretations of the Medicare Act, in a manner that might survive Loper Bright.

Lawmakers Request Comments from Health Stakeholders on Medical Research and Care Delivery Reforms

By Beth Goldstein and Josephine Magnotti on June 14, 2024 Posted in 21st Century Cures Act, Policy, Research

On June 6, 2024, Reps. Diana DeGette (D-CO) and Larry Bucshon, MD (R-IN) released a letter requesting information from stakeholders on their 21st Century Cures initiative, a policy effort focused on medical research and health care transformation and reforms. With this opportunity to comment, the lawmakers have renewed their commitment to developing the initiative with the support of the health community, nearly eight years after the passage of the 21st Century Cures Act (Pub. L. 114-255).

Enacted in December 2016, the bipartisan 21st Century Cures Act was led by Reps. DeGette and Fred Upton (R-MI) and represented a landmark legislative effort to accelerate health research and delivery reforms across the United States. The legislation aimed to expedite the discovery, development, and delivery of novel treatments and cures and provide these advancements to patients efficiently. The bill allocated substantial funding to the National Institutes of Health (NIH) to support cutting-edge biomedical research; specifically, it provided $4.8 billion over 10 years to the NIH to support the Precision Medicine Initiative, the Brain Research through Advancing Innovative Neurotechnologies (BRAIN) Initiative, and cancer research through the Cancer Moonshot. Additionally, the legislation streamlined regulatory processes at the Food and Drug Administration, including provisions to speed up the review of novel therapies, encourage the use of real-world evidence in approvals, and allow for adaptive trial designs. Notably, it also introduced crucial reforms in mental health care, supported advancements in health information technology, and emphasized the importance of patient perspectives in the development and regulation phases for emerging drugs.

Australian Privacy Regulator Commences Penalty Proceedings Against Medibank

By Squire Patton Boggs on June 7, 2024 Posted in Australia, Cybersecurity, Data Protection, Insurance, Privacy

On 5 June 2024, the Australian Information Commissioner commenced civil penalty proceedings in the Australian Federal Court against Medibank Private Limited (an Australian health insurance provider) in relation to an October 2022 data breach.

On 25 October 2022, Medibank notified the Office of the Australian Information Commissioner (OAIC) of a data breach concerning sensitive personal information of 9.7m Australians (representing approximately 37% of Australia’s total population). As a result of a cyber-attack, malicious actors had gained access to a vast library of customer data which included identity details, government identifiers and medical and insurance records. Over the course of a number of weeks, the malicious actors ‘leaked’ sensitive personal information of Medibank customers and other impacted individuals onto the dark-web in the course of pursuing cyber ransoms from the major insurance-provider.

Switching Data – A Potent Tonic for Obtaining CMA Clearance at Phase 1

By Francesco Liberatore and James Mosely on June 5, 2024 Posted in Antitrust, United Kingdom

Customer switching data is an important factor that the Competition and Markets Authority (CMA) considers when assessing the closeness of competition of merging parties. However, as the completed acquisition by Pharmacy2U Limited (Pharmacy2U) of Lloyds Direct demonstrates, switching data can also be determinative when it comes to market definition.

Pharmacy2U is a Distance Selling Pharmacy (DSP) that supplies prescription-only medicines (POMs) in England. POMs are pharmaceutical drugs that require a prescription and are dispensed by a pharmacist. Pharmacy2U also provides other healthcare services, runs an online doctor consultation service and sells a range of health and wellbeing products. Metabolic Healthcare Limited (trading as Lloyds Direct, together with Pharmacy2U, the Parties) is also a DSP and supplies POMs in England. Following the completed acquisition of the entire share capital of Lloyds Direct by Pharmacy2U on 5 October 2023 (Transaction), the CMA called in the Transaction for review and decided to clear the Transaction on 12 March 2024.

CMS Finalizes a New Rule to Require Extensive API Implementation and Quicker Turnaround for Prior Authorization Decisions: What Payers Should Know

By Doug Anderson and Jonathan Abele on May 13, 2024 Posted in CMS, Insurance, Managed Care, Medicare Advantage, Payer/Insurance Reform

On January 17, 2024, the Centers for Medicare & Medicaid Services (“CMS”) issued a final rule regarding interoperability and prior authorization (the “Rule”). CMS-0057-F. The Rule’s goals, according to CMS, are to facilitate the electronic exchange of health-care data, improve and expedite prior authorization processes, and reduce related burdens for payers, healthcare providers, and patients, with estimated savings of $15 billion over 10 years. The Rule’s changes focus on two areas: (1) interoperability advancement and (2) prior authorization streamlining. Both changes target federally regulated health insurers such as Medicare Advantage Organizations, state Medicaid and Children’s Health Insurance Program (“CHIP”) Fee-for-Service programs, Medicaid managed care plans, CHIP managed care entities, and Qualified Health Plan (“QHP”) issuers on the Federally Facilitated Exchanges (“FFEs”), (collectively, “Impacted Payers”).

For interoperability advancement, Impacted Payers must implement and maintain four application programing interfaces (“APIs”), which are software that allow other software applications to exchange information and features more efficiently. These four APIs are (1) the Patient Access API, (2) the Provider Access API, (3) the Payer-to-Payer API, and (4) the Prior Authorization API. Although compliance dates vary based on payer type, Impacted Payers must generally implement these four APIs by January 1, 2027.