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Week Ahead in Health: Oct. 18, 2021

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(Reuters) - Here are some events of interest to the health law community this week. All times are local unless otherwise noted.

Monday, Oct. 18

9 a.m. – The 9th U.S. Circuit Court of Appeals will hear specialty-drug company Nexus Pharmaceuticals’ appeals from the dismissal of its lawsuits against three compounding pharmacies, alleging unfair competition under California law. Nexus last year obtained U.S. Food and Drug Administration approval for Emerphed – a premixed, injectable-ready solution of ephedrine sulfate, which hospitals use to combat low blood pressure in patients under anesthesia – then sued the compounding pharmacies for continuing to offer ephedrine sulfate products. A federal judge in Santa Ana found the state-law claims preempted by the federal Food, Drug and Cosmetics Act, which gives the FDA power to block compounding pharmacies from selling “essentially a copy” of an approved drug. The cases are Nexus Pharmaceuticals v. Leiters, 9th U.S. Circuit Court of Appeals No. 20-56158; Nexus v. Quva Pharma, No. 20-56160; and Nexus v. Central Admixture Pharmacy Services (CAPS), 20-56227. For Nexus: Imron Aly of Schiff Hardin. For Leiters: John Ruskusky of Nixon Peabody. For Quva: Saul Perloff of Shearman and Sterling. For CAPS: Keith Wesley of Browne George Ross O'Brien Annaguey & Ellis.

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Tuesday, Oct. 19

9 a.m. – The 9th U.S. Circuit Court of Appeals will hear argument on whether Los Angeles County’s ban on the sale of flavored tobacco products is preempted by federal law. U.S. District Judge Dale Fischer in Los Angeles upheld the ban last year, rejecting R.J. Reynolds Tobacco’s argument that it is expressly or impliedly preempted by the federal Family Smoking Prevention and Tobacco Control Act, which governs the manufacture of tobacco products, and that interferes with the regulatory authority of the U.S, Food and Drug Administration. The case is R.J. Reynolds Tobacco Company v. County of Los Angeles, 9th U.S. Circuit Court of Appeals No. 55930 For R.J. Reynolds: Noel Francisco and Christian Vergonis of Jones Day. For the County: Kent Raygor and Valerie Alter of Sheppard Mullin Richter & Hampton.

Wednesday, Oct. 20

9 a.m. – U.S. District Judge Jane Triche Milazzo will hold the final pretrial conference in New Orleans for the second bellwether case in multidistrict litigation over Sanofi’s chemotherapy drug Taxotere. Plaintiff Elizabeth Kahn says Sanofi failed to warn her doctor that the drug causes permanent hair loss. Her doctor testified that he would have recommended Taxotere anyway, but would have presented alternatives to Kahn if she said she did not want to take Taxotere to avoid permanent hair loss. Milazzo has scheduled a two-week trial, starting with jury selection on Nov. 5. The MDL includes more than 12,000 cases; the first bellwether resulted in a verdict for Sanofi, which is currently on appeal. The case is In re Taxotere (Docetaxel) Products Liability Litigation, U.S. District Court for the Eastern District of Louisiana, No. 16-md-02740 (Kahn, 16-17039). For Kahn: Chris Coffin of Pendley, Baudin & Coffin; Karen Menzies of Gibbs Law Group; M. Palmer Lambert of Gainsburgh Benjamin David Meunier & Warshauer; and Dawn Barrios of Barrios Kingsdorf & Casteix. For Sanofi: Adrienne Byard of Shook, Hardy & Bacon and Douglas Moore of Irwin Fritchie Urquhart & Moore.

10 a.m. – U.S. District Judge R. David Proctor of Birmingham, Alabama, will commence the final fairness hearing on the proposed $2.67 billion settlement of the Blue Cross Blue Shield consumer (subscriber) antitrust cases, continuing on Oct. 21 if necessary. The plaintiffs in the 2013 multidistrict litigation alleged that Blue Cross Blue Shield Association and its 36 member companies divided up health insurance markets to avoid competing with each other. Proctor granted the settlement preliminary approval in November. The settlement provides formulas for distributing $1.9 billion to the settling plaintiffs, with $107 million set aside for a Notice and Administration Fund and expenses, and $667 million, combined, for attorneys’ fees and expenses. BCBS has also agreed to allow member companies to compete with each other and to earn more revenue from “non-Blue” services. The case is In Re Blue Cross Blue Shield Antitrust Litigation (MDL 2406), U.S. District Court for the Northern District of Alabama No. 13-20000. For the settlement class: Michael Hausfeld of Hausfeld LLP and David Boies of Boies Schiller Flexner. For Self-Funded Subclass: Warren Burns of Burns Charest. For BCBS Association: David Zott, Kirkland & Ellis.

2 p.m. – The U.S. Health and Human Services Department faces a deadline to file its brief in the U.S. Supreme Court in a closely-watched case over a 2018 rule-change that cut Medicare drug-reimbursement rates to certain “safety net” clinics and hospitals by nearly 30 percent. Under Section 340B of the Public Health Safety Act, eligible providers can purchase drugs from manufacturers at greatly reduced prices. The American Hospital Association challenged the 2018 rule, noting that Congress created the 340B program in 1992 to benefit eligible hospitals and clinics, not the government. A divided panel of the D.C. Circuit deferred to the government’s reading of the statute and its rationale that the change would rein-in overutilization of expensive drugs. The Supreme Court will hear argument Nov. 30. The case is American Hospital Association et al. v. Xavier Becerra, Secretary of Health and Human Services, et al., U.S. Supreme Court No. 20-1114. For AHA: Donald Verrilli Jr of Munger, Tolles & Olson. For Becerra et al.: Acting Solicitor General Brian Fletcher

4 p.m. – ACE Property and Casualty Insurance and an AIG unit must respond to McKesson Corp.’s claims that they have a duty to defend it against thousands of federal lawsuits consolidated in the National Prescription Opiate Litigation MDL and hundreds of similar suits filed in state courts. The insurers initiated the litigation last year in federal court in San Francisco, seeking declaratory judgments that they owed no duty to defend or indemnify McKesson for allegedly contributing to the opioid crisis. McKesson counterclaimed for breach of contract in November, days after reaching a settlement in the MDL under which it agreed to pay about $8 billion over the next 18 years. McKesson is now seeking partial summary judgment solely on the duty to defend, alleging that its legal bills have already topped more than $270 million. The lead case is AIU Insurance and National Union Fire Insurance of Pittsburgh PA v. McKesson Corp., U.S. District Court for the Northern District of California, No. 20-7469. For AIG’s National Union: Christopher St. Jeanos of Willkie Farr and Gallagher; Richard Doren of Gibson, Dunn & Crutcher. For ACE: Michael Shuster and Daniel Sullivan of Holwell Shuster & Goldberg. For McKesson: Gretchen Hoff Varner of Covington & Burling.

Friday, Oct. 22

2 p.m. – The respondent's brief is due in the U.S. Supreme Court from people with HIV/AIDS who allege that CVS Pharmacy and pharmacy benefits manager Caremark discriminated against them by requiring ERISA-plan participants to use CVS or its mail-order pharmacy to get the in-network price for the highest-cost tier of drugs. The 9th U.S. Circuit Court of Appeals found the “John Doe” parties had stated a claim for discrimination under the Affordable Care Act. CVS argues that the ACA only allows individuals to sue for intentional discrimination – not facially neutral practices that have a disparate impact on people with disabilities. The Supreme Court granted CVS’s petition for review in July and has scheduled argument for Dec. 7. The case is CVS Pharmacy et al. v. John Doe One et al., U.S. Supreme Court No. 20-1374. For CVS: Lisa Schiavo Blatt of Williams & Connolly. For John Doe One et al.: Gerald Sinclair Flanagan of Consumer Watchdog.

Know of an event that could be included in Week Ahead in Health Law? Contact Brendan Pierson at brendan.pierson@thomsonreuters.com

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