In response to the COVID-19 pandemic, the U.S. and many state governments have taken a number of steps to expand access to telehealth services and reduce other barriers to care. Among other things, the U.S. Centers for Medicare and Medicaid Services (CMS) has eliminated a number of restrictions on the coverage of telehealth services under Medicare to enable coverage of services provided to patients, including new patients, located in their homes. Many commercial payors have also taken action to expand access to telehealth, including by eliminating co-payments for such services. Many states have temporarily waived in-state licensure requirements to enable physicians, registered nurses, licensed practical nurses, nurse practitioners, and other medical personnel licensed in any state to provide telehealth services to their residents. The Department of Health and Human Services (HHS), Office of Inspector General (OIG) announced that physicians and other practitioners will not be subject to administrative sanctions for reducing or waiving any cost-sharing obligations Federal health care program beneficiaries may owe for telehealth services. The HHS Office for Civil Rights (OCR) additionally announced that during the pandemic, it will allow healthcare providers to provide telehealth services to patients through any non-public facing communication applications such as Apple FaceTime, Facebook Messenger, Google Hangout, and Skype. Finally, the Drug Enforcement Administration (DEA) and the Food and Drug Administration (FDA) have both taken steps in response to the COVID-19 pandemic to remove barriers restricting patient access to controlled substances and medicines. We review these developments below.

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Over the past week, the governors of several states have issued “stay-at-home’ orders to combat the spread of the coronavirus known as COVID-19. These stay-at-home orders significantly limit freedom of movement within the affected states and instruct businesses to institute remote work solutions for their employees—or else to shut their doors entirely.

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Businesses in the United States and around the world are undergoing a fundamental and unprecedented disruption as a result of the coronavirus pandemic (COVID-19). State governments have issued “shelter-in-place” and “stay-at-home” orders to the general population, postponed or otherwise cancelled schools in full, and shut down all businesses except those deemed “essential” or “critical” to the maintenance of our country. These actions have already caused dramatic losses of income to business, and those losses will continue to grow as the actions necessary to combat the coronavirus continue to take hold. Fortunately, businesses may have an avenue available to them to recoup some or all of these losses through business interruption coverage in commercial property insurance.

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As the COVID-19 pandemic unfolds, our drug, biologic, and medical device clients conducting or planning to conduct clinical trials may be faced with challenges related to quarantines, travel limitations, site closures or access restrictions, infection transmission concerns of site research personnel and study subjects, and supply chain interruptions. Nonetheless, it remains critical during the COVID-19 pandemic to continue to assure the safety of trial participants, comply with good clinical practice (GCP) requirements, and minimize risks to trial integrity. In this client alert which follows our earlier article on product development considerations for COVID-19 and article on FDA scrutiny of COVID-19 medical product marketing, we briefly discuss the impact the COVID-19 pandemic may have on our life sciences clients, and we provide an overview of FDA’s “Guidance on Conduct of Clinical Trials of Medical Products during COVID-19 Pandemic” issued on March 18, 2020.

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We encourage our clients to be proactive in responding to the potential impact of COVID-19 on both existing and potential business agreements and relationships. Now that the World Health Organization has formally classified the outbreak of COVID-19 as a pandemic, and the full spread of the virus remains uncertain, it is important that businesses consider the potential implications of the virus on negotiation and performance of their contracts. Whether you are planning to negotiate or currently negotiating contractual agreements, or whether your commercial operations and relationships have already felt the impact of this novel coronavirus, there are several considerations to keep in mind to ensure the smooth operation of your business and to mitigate the potential for litigation amid a pandemic. This alert discusses those considerations.

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“In the recent weeks our risk management team has identified a number of insurance-related issues relevant to clients dealing with the outbreak of the disease caused by the novel coronavirus, known as COVID-19, that we felt important to share with clients.

This alert is focused on business-related insurance (not individual or health insurance) and in particular, is primarily focused on management liability insurance (Directors and Officers (D&O), Employment Practices Liability (EPL), and Fiduciary liability policies), professional liability insurance (also known as Errors & Omissions (E&O) liability policies) and transaction liability insurance (such as Representations & Warranties Insurance (R&W Insurance)).

We have highlighted key issues on these corporate policies to provide guidance on: (1) what types of loss may be covered under insurance that could potentially arise from the COVID-19 outbreak; (2) issues that could impact coverage for such claims; and (3) negotiating and underwriting policies during this pandemic.”

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In response to the outbreak of a pneumonia-like disease caused by coronavirus (COVID-19), Chinese regulatory authorities adopted a few emergency measures under certain “Special Review and Approval Procedures” to fast-track the review and approval process for developing diagnostic kits, vaccines and therapies for combating COVID-19 infections. There are several types of “fast track” procedures available under the current Chinese regulatory framework. The most important three are Special Review and Approval Procedure of 2005, Special Review and Approval Procedure of 2007, and Priority Review and Approval Procedure of 2017, all of which are summarized in this alert.

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Because life sciences companies hope to never end up on clinical hold, preparing for such a call from the U.S. Food and Drug Administration (FDA) is often not on the to-do list. But there can be significant advantages to advance preparation. Our Goodwin Insight shares some tips for life sciences companies on navigating that first call with FDA and the actions that follow.

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The 2019 novel coronavirus (coined COVID-19 by the World Health Organization) is the latest in a series of public health emergencies in recent years to challenge product developers in the life sciences community. With every challenge comes an opportunity, in this case to leverage product development plans and technologies to be first-to-market with products useful in remediating some aspect of COVID-19 and its spread. Earlier this year, the U.S. Food and Drug Administration (FDA) announced its commitment to extend all available resources to help expedite the development and availability of medical countermeasures (MCMs) to prevent, treat, or diagnose COVID-19 and, in fact, issued the first emergency use authorization (EUA) shortly thereafter. For life sciences companies exploring potential opportunities to leverage their programs to help treat, detect, or address some aspect of COVID-19, a number of regulatory mechanisms may be available to facilitate and advance product development plans.

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What financial arrangements between clinical trial sponsors and clinical investigators must be disclosed in a drug, biologic or device marketing application?

In a marketing application, FDA requires that four types of financial arrangements be disclosed: (1) any financial arrangement between the sponsor and the investigator whereby the value of the compensation to the investigator for conducting the study could be influenced by the outcome of the study; (2) any significant payments of other sorts from the sponsor, such as a grant to fund ongoing research, compensation in the form of equipment, a retainer for ongoing consultation, or honoraria, which are greater than $25,000 in cumulative value and given to the investigator or the investigator’s institution to support the investigator’s activities, exclusive of the costs of conducting the study, for the duration of the study and for one year following the study’s completion; (3) any proprietary interest in the tested product held by the investigator; and (4) any significant equity interest in the sponsor held by the investigator, which is any amount for a non-publicly traded company or an equity interest in a public company valued over $50,000 for the duration of the study and for one year following the study’s completion.

How is a clinical investigator defined in the context of FDA financial disclosure regulations?

In FDA’s financial disclosure regulations, the agency defines a clinical investigator as a listed or identified investigator or sub-investigator who is directly involved in the treatment or evaluation of research subjects. The term also includes the spouse and each dependent child of the investigator.

What does FDA look for with regard to financial interest?

FDA looks at several factors with regard to financial interest, including the size and nature of the disclosed financial interest, the steps taken to minimize the potential for bias, and the study design. For example, FDA will evaluate whether the study has been designed with multiple investigators (most without a disclosable interest), blinding, objective endpoints, or measurement of endpoints by someone other than the investigator. FDA may initiate audits of the data from the investigator at issue, request that the applicant submit further analyses of the data or conduct additional independent studies to confirm the results. The agency could also refuse to treat the study as providing data that can be the basis for an agency action. We recommend you contact your Goodwin life sciences or FDA lawyer for further explanation of the agency’s financial disclosure regulations.