Category Archives: Legal news

Paola Sangiovanni to Speak on Artificial Intelligence

Our firm will be attending the EMEA Regional Meeting of Ally Law in Malta next week and on Friday November 15th I will be speaking at a panel discussion titled “Keeping an Eye on AI: Ethical and Regulatory Considerations.” 

Artificial intelligence is a hot topic, also in the med-tech field, and poses exciting legal, ethical and regulatory questions. I am sure this will be an interesting opportunity to discuss them with legal and technical experts. 

 

Is Your Cookie Policy Right?

In a recent decision by the Court of Justice of the European Union in case C-673/17 against Planet49 GmbH, the issue of consent was analyzed on the basis of the ePrivacy Directive and the GDPR.

The case regarded a preliminary question by the German Federal Court of Justice on the validity of consent given through a pre-ticked checkbox, which the user must deselect to refuse his or her consent.

The Court analyzed the features of consent under the ePrivacy Directive (“freely given specific and informed indication of his wishes by which the data subject signifies his agreement to personal data relating to him being processed” by reference to the Data Protection Directive) and in the GDPR (“any freely given, specific, informed and unambiguous indication of the data subject’s wishes”).

The Court concluded that the user is required to “give” consent and to provide an “indication”, which “points to active, rather than passive, behavior.” Therefore, an opt-out consent is not validly given.

You may want to check if your website has a passive mechanism to accept cookies (including a mechanism whereby “continuing to browse the website means acceptance of these cookies”): under the Court’s decision described above, it is possible that such a passive consent would be regarded invalid.

This conclusion would appear to contradict the previous guideline by the Italian Data Protection Authority providing that “if the user continues browsing by accessing any other section or selecting any item on the website (e.g. by clicking a picture or a link), he or she signifies his or her consent to the use of cookies.”

Further, the Court set forth that “the information that the service provider must give to a website user includes the duration of the operation of cookies and whether or not third parties may have access to those cookies.

Recent Data Protection Developments

There are a few interesting developments in the area of data protection that you may have missed and we can recap for you:

  • CONDITIONS TO PROCESS CERTAIN DATA ISSUED BY THE ITALIAN DATA PROTECTION AUTHORITY. According to section 9 paragraph 4 of the GDPR, Member States are entitled to introduce additional conditions for the processing of genetic, biometric or health data. On July 29, 2019 the final version of such conditions issued by the Italian Data Protection Authority has been published on the Official Journal. Such conditions apply to processing of data (i) in employment relationships, (ii) by associations, (iii) by private investigators, (iv) that are genetic or (v) for purposes of scientific research.
  • RIGHT TO BE FORGOTTEN. On September 24, 2019 the European Court of Justice has issued a judgment on the right to be forgotten in case C‑507/17 against Google Inc. The Court has ruled that “there is no obligation under EU law, for a search engine operator who grants a request for de-referencing made by a data subject, as the case may be, following an injunction from a supervisory or judicial authority of a Member State, to carry out such a de-referencing on all the versions of its search engine.” While the right to be forgotten must be enforced in all Member States, there is no obligation to do that in all national search engines. The Court, however, added that a supervisory or judicial authority, after balancing all rights concerned, would be able to order de-referencing on all search engines in the world since “EU law does not currently require that the de-referencing granted concern all versions of the search engine in question, it also does not prohibit such a practice.” Given the reaction to the judgment by the Chairperson of the Italian Garante (the data protection authority) Mr. Antonello Soro, it cannot be excluded that that the Garante may issue a universal, rather than EU-wide, dereferencing order.
  • PROCESSING FOR “OWN PURPOSES”. A med-tech company has been sanctioned for having used patient data (medical scans) in a public tender process and in a subsequent litigation in an anonymized form. The company had been appointed by the hospital as a data processor but, the Garante ruled, had further processed such patient data for an own purpose rather than for the purposes mandated by the data controller (i.e., maintenance of equipment generating scans for patients).
  • AGAIN ON THE RIGHT TO BE FORGOTTEN. In a decision by the Italian Garante dated July 24, 2019 Google LLC has been ordered to de-reference from its search engine news about criminal facts occurred in 2007 for which an individual, without any public role, had been condemned, but who had been fully rehabilitated.
  • CONSUMER CREDIT CODE OF CONDUCT. On September 19, 2019 the Italian Garante approved a new code of conduct for companies operating in the areas of consumer credit, credit worthiness analysis and payment punctuality.

 

EU Commission Factsheet on MDR and IVDR

Still confused about the regulatory changes affecting medical devices and in vitro devices? The EU Commission has published a useful factsheet, which you can find here.

Through the factsheet, the Commission warns health institutions and healthcare professionals that the upcoming changes may have consequences on the availability of medical devices because manufacturers may decide to stop their production or because products may not get their certificates on time.

Some notified bodies have also decided to drop off and only two notified bodies have been MDR designated so far, so this will create additional bottlenecks. A short grace period until 2025 is granted, but it does not apply to class I devices.

The path to an enhanced regulatory framework will be complicated and manufacturers, healthcare institutions and healthcare professionals need to know what to expect.

Clinical Trial Regulation: Another Piece of the Puzzle

Another piece of the puzzle that will become the Italian clinical trials regulatory framework has been completed last week through the publication of Legislative Decree no. 52 of 2019. We had already talked about changes to clinical trials legislation in this previous post and some of the current changes had already been foreseen in such bill.

Here are the major changes:

  • The Italian pharmaceutical agency (AIFA) will be called to issue requirements for trial centers and specific weight will be given to the involvement of patients’ associations by the center in the protocol definition;
  • Patients associations will be involved also in the process of evaluation and authorization of clinical trials;
  • AIFA will publish data on authorized trial centers, along with curricula vitae of individuals involved in the conduct of the study;
  • AIFA will also need to set forth rules to guarantee the independence of the clinical trials and the absence of conflicts of interest in furtherance of section 9 of EU Regulation 536/2014;
  • In case of breach of terms and procedures relating to clinical trials, or of rules on independence and transparency, an ethical committee may be suspended;
  • New rules aimed at facilitating non-profit trials and observational studies (also post-market) will be introduced, which will allow the assignment of study data and their use for registration purposes.
  • Research methodologies and clinical trials conduct will be the subject matter of specific training courses offered, also as continuing medical education.

In conclusion, we need to wait for further rules before the puzzle is complete.

New Rules on Public Procurement

On June 12, following a confidence vote, the lower chamber of the Italian Parliament has approved a law that will bring quite a few changes to the Public Procurement Code.

The new law, which has not been published in the Italian Official Gazette yet, has been enthusiastically announced as a way to accelerate governmental contracts, in line with the nickname of the act (“Sblocca Cantieri“, which could be translated as “Unlocking Building Sites”).

By way of example, the act allows subcontracting up to 40% (the previous threshold was 30%) and sets forth that only three competing offers will be required for contracts with a value between 40 and 150 thousand Euros. It also includes rather odd provisions, such as the increase in spending for close circuit tv cameras in public structures’ premises where small children and old people are cared for (see section 5 septies). 

The law has been bitterly criticized by the head of the Italian Anti-Corruption Authority, who pointed out that the aggregate value of public procurement contracts is at its highest (139.5 billions in 2018) and that criminal infiltration in companies bidding for public works is also very significant. Many fear that de-regulation of the sector will not bring positive results.

Others simply point out that this body of law has been subject to too many changes in the past years, which makes it difficult for helpful case law to develop and confuses operators.

Why the European Union Whistleblower Laws Are All Doomed To Failure – BY GUEST BLOGGERS MARC RASPANTI AND PAM BRECHT

Today we are hosting a blog post by the US attorneys Marc Stephen Raspanti and Pamela Coyle Brecht.

Marc is the name partner of the US law firm Pietragallo Gordon Alfano Bosick & Raspanti, LLP located in Philadelphia, Pennsylvania, the founder of the firm’s White Collar Criminal Defense Practice Group, as well as the firm’s global Qui Tam/False Claims Act Practice Group (msr@pietragallo.com).

Pam serves as the firm’s Practice Chair for the firm’s global Qui Tam/False Claims Act Practice Group (pcb@pietragallo.com). Their firm websites are:  http://www.pietragallo.com and http://www.falseclaimsact.com

Member States of the European Union, over the last several years, have passed a series of so-called “Whistleblower Laws.”  These laws are being implemented allegedly to bolster anti-corruption efforts throughout Europe.  While corruption is no stranger to either side of the Atlantic, the European Union would advance their fraud fighting efforts exponentially by taking a focused look at the highly successful American False Claims Act.

France, Ireland, Italy, Greece, Germany, Netherlands, Sweden, Hungary, Lithuania, Malta, Slovakia, the United Kingdom, as well as others, have passed or amended some type of a putative whistleblower law.  Here is the issue.  None of these whistleblower statutes, in our opinion, contain the basic tenents of a strong and effective whistleblower program.  The development of the whistleblower statutes within the United States of America illustrates the bedrock elements of an effective and successful whistleblower law.

In 1986, the U.S. Congress amended the existing whistleblower statute, the False Claims Act, which was passed during the American Civil War by President Abraham Lincoln.  The 1986 Amendments to the False Claims Act included provisions that finally gave the law real fraud combatting teeth. Examining these 1986 Amendments (and even more recent Amendments) illustrates the changes needed in the European Union member States’ whistleblowing statutes.  Without such robust amendments the European Union laws will never have a real and palpable impact on fraud, waste and abuse.

The American statute, known as federal False Claims Act, or the Qui Tam Law, has at its heart the following key provisions:

  • The United States has what is known as a “qui tam[4] or whistleblower provision.
  • A whistleblower who comes forward and meets the statutory requirements is authorized by the statute to bring an action on behalf of the government and is entitled to receive a set amount of any settlement or judgment the government receives from the defendant from 15% to 30%. This strong financial incentive has, singlehandedly, made the American statute the most successful fraud, waste and abuse statute in the world.  Of this fact there is no debate.
  • The United States’ Congress has provided strong protections against professional retaliation against whistleblowers. In contrast, the European statutes contain weak non-existent or watered down versions of this protection.  In fact, some of the European laws actually put the whistleblower at risk if he or she is incorrect in their allegations. 
  • The American whistleblower statute attracts skilled lawyers who take these cases on a contingent-fee basis, award legal fees and costs to whistleblowers and their counsel, if they prevail in their claims against a defendant.
  • The American statute provides government attorneys with muscular investigative powers. For example, while the case is under seal, the government can issue document requests, written interrogatories, take depositions of key individuals, etc.  These broad investigative tools are lacking in most of the current European statutes.
  • As a result of the key amendments in 1986, the American whistleblower statute has returned more than $62 billion to the U.S. Treasury. No other whistleblower law in Europe (or anywhere) has had such success.

The European legislative bodies still do appear to be committed (culturally or legally) to the type of whistleblowing legislation that will not make a real difference for their respective countries.  Here are some of the reasons why the statutes in Europe shall continue to be as ineffective as the pre-1986 American Whistleblower Law:

  • The European statutes do not truly embrace the concept that whistleblowers need to be encouraged to come forward to expose corruption inside large, well regarded institutions. The majority of the European laws do not contain any financial reward for successful whistleblowers.  Most importantly, none of the European statutes have a strong financial reward that would balance the risks against the rewards.  The European laws seem to go through the motions of supporting, yet not incentivizing, whistleblowers.
  • There is no clear and distinct prosecutorial entity in charge of effectively enforcing the individual European statutes.
  • Many of the European statutes lack strong protections for whistleblowers who come forward and risk their careers and livelihood. While there is a lot of “lip service,” there is no economic insurance that they will be protected.

While Americans and Europeans have shared and adopted approaches to governance over the centuries, their differences in efforts to curtail fraud, waste and abuse through whistleblower statutes is considerable.  Europe need look no further than its young sister state across the Atlantic for lessons that may be worth billions of dollars in recoveries.

WHO Pushes towards Transparency of Prices of Health Products

Yesterday the World Health Organization announced a resolution encouraging Member States to “enhance public sharing of information on actual prices paid by governments and other buyers for health products, and greater transparency on pharmaceutical patents, clinical trial results and other determinants of pricing along the value chain from laboratory to patient.” The resolution also urged Member States to “work collaboratively to improve the reporting of information by suppliers on registered health products, such as reports on sales revenues, prices, units sold, marketing costs, and subsidies and incentives”.

The Italian Ministry of Health reported the adoption of this resolution with triumphant tones since the resolution was proposed by Italy and co-sponsored by Algeria, Andorra, Botswana, Brazil, Egypt, Eswatini, Greece, India, Indonesia, Kenya, Luxembourg, Malesia, Malta, Portugal, Russian Federation, Serbia, Slovenia, South Africa, Spain, Sri Lanka, Uganda and Uruguay.

Many hope that transparency of prices of health products will result in greater fairness in health systems and will ultimately drive prices down. On the other hand, representatives of the industry claim that the focus on price will not shed light on the complexities of costs linked to research and manufacturing of health products. Instead, Gaelle Krikorian of Medecins Sans Frontieres believes that the resolution marks only a first step and that more disclosure is necessary.

Ethics Guidelines for Trustworthy Artificial Intelligence

The perception of digital innovation is changing. The initial enthusiasm is now being replaced with a more cautious, at times skeptical, approach. If you are familiar with Shoshana Zuboff’s views on Surveillance Capitalism or, more locally, the concerns voiced by Antonello Soro, Chairman of the Italian Data Protection Authority, on the use of data, you may now be starting to question how much actual good will humanity derive from unbridled innovation.

The good news is that the European Union continues to be at the forefront of a human-centric approach to technology so that innovation can be responsible and sustainable. The GDPR, which came into force about a year ago, has brought the focus to the fundamental right to data privacy, reminding all stakeholders that the human being remains at the center of any digital innovation.

Last month the Independent High-Level Expert Group in Artificial Intelligence set up by the European Commission has issued interesting Ethics Guidelines for Trustworthy AI. The document clearly indicates that AI should lawful, ethical and robust in order to be trusted, and trustworthy. AI systems must be based on fundamental rights such as respect for human dignity, freedom of the individual, respect for democracy, justice and the rule of law, equality, non-discrimination and solidarity, and citizens’ rights. Ethical principles of respect for human autonomy, prevention of harm, fairness and explicability must be respected and any tensions between them must be duly balanced. Privacy and data governance, transparency, diversity, non-discrimination and fairness are also important requirements of the realization of trustworthy AI systems.

In conclusion, the guidelines state that “AI systems will continue to impact society and citizens in ways that we cannot yet imagine. […] Our goal is to create a culture of “Trustworthy AI for Europe whereby the benefits of AI can be reaped by all in a manner that ensures respect for our foundation values: fundamental rights, democracy and the rule of law.”

Takeaways from the EU Pharmaceutical Law Forum in Brussels

I really enjoyed attending and speaking at the EU Pharmaceutical Law Forum in Brussels this week. The event offered a number of insights into the legal challenges faced by the life sciences industry in an ever-evolving regulatory landscape. These are the main takeaways from the conference:

#1: Clearly, the political climate is not favorable to pharma and med-tech companies. A number of measures have been proposed at various levels that would significantly decrease the incentives to innovation that companies currently enjoy. Such proposed measures range from halving the term of protection for orphan drugs exclusivity to compulsory licensing of drug patents, from incentives to drug compounding by pharmacies to mandatory price reductions. The general public and the media continue to have a negative perception of the industry and the regulatory framework appears to be evolving in a restrictive way.

#2: Despite the uniform letter of GDPR throughout the Member States, interpretation of data protection rules continues to be very different throughout Europe. This is especially clear in the field of clinical trials, where there is a patchwork of legal solutions that makes it impossible to multinational corporations to adopt a consistent approach. The recent EDPB opinion on the legal basis for processing of data deriving from clinical trials has further shown that there has been a shift away from consent as the legal basis for the processing, but some countries (like Germany, Italy and Spain, for example) continue to find it hard to accept such a shift.

#3: EU harmonization is expected to occur in the coming years in a number of areas, such as off-label use, artificial intelligence and health technology assessment.

#4: Compliance efforts must be continued, but it is clear that formal compliance is not sufficient to shield a company from risks, especially reputational risks. Even when compliance safeguards are in place, the approach to reputational risks must be perfectionist, as pointed out by Ms. Alice Cabrio, compliance officer at Roche S.p.A.

Enjoy your weekend, and do not forget to celebrate the GDPR’s first birthday!