Author: WorkCompAcademy

The U.S. Attorney’s Office has reached a $3.5 million settlement with specialty pharmacy Advanced Care Scripts, Inc, to resolve allegations that ACS conspired with pharmaceutical manufacturer Teva Neuroscience, Inc. to enable Teva to pay kickbacks to Medicare patients taking Copaxone, a Teva drug approved for treatment of multiple sclerosis.

When a Medicare beneficiary obtains a prescription drug covered by Medicare Part B or Part D, the beneficiary may be required to make a partial payment, which may take the form of a co-payment, co-insurance, or deductible. These co-pay obligations may be substantial for expensive medications.

Congress included co-pay requirements in these programs to encourage market forces to serve as a check on health care costs, including the prices that pharmaceutical manufacturers can demand for their drugs.

The Anti-Kickback Statute prohibits pharmaceutical companies from offering or paying, directly or indirectly, any remuneration – which includes money or any other thing of value – to induce Medicare patients to purchase the companies’ drugs.

Advanced Care Scripts served as a contracted vendor for Teva and provided, among other things, benefits investigation services to certain patients who had been prescribed Copaxone. As part of the settlement, the company acknowledged certain facts.

Advanced Care Scripts knowingly enabled a large pharmaceutical manufacturer to pay kickbacks to Medicare patients taking its expensive drug. Prosecutors say that such conduct undermined the Medicare program’s co-pay structure, which Congress created as a safeguard against inflated drug prices.

“Advanced Care Scripts (ACS) willingly served as a pawn in a kickback scheme, putting profit over patient needs, by helping Teva to time its foundation payments to boost sales of Teva’s own drug, which ACS then dispensed,” said Joseph R. Bonavolonta, Special Agent in Charge of the FBI Boston Division.

Proposed new law, SB 1399, is so far-reaching that it’s being labeled by critics as an existential threat to what remains of the once-booming apparel industry in Los Angeles, which has shrunk to roughly 45,000 workers after decades of competition from cheap foreign labor.

More than a dozen business groups have lined up against it, including the industry’s trade association, the California Chamber of Commerce and the California Retailers Assn.

But the article published on MSN says that opposition, though, is not uniform as some high-profile L.A.-area companies are backing the bill, including Reformation, which markets eco-friendly women’s wear and has a celebrity clientele, and Fashion Nova, the popular fast-fashion retailer, which has been accused of turning a blind eye to wage theft but recently announced changes to its contracting practices.

The proposed reforms follow those enacted in 1999, four years after 72 undocumented Thai workers were found virtually enslaved in an El Monte apartment complex, stitching together clothing behind barbed wire. That legislation made garment manufacturers liable for wage violations by the contractors who cut, sew and otherwise produce their garments.

But in the decades since, worker advocates say that some fashion brands and retailers that carry their own clothing lines have found ways to skirt the law by employing layers of subcontracting between them and the small factories that actually produce apparel.

Random inspections of 77 garment shops conducted in 2015 and 2016 by the U.S. Department of Labor’s Wage and Hour Division found wage violations at 85% of them. Advocates say the situation hasn’t gotten any better, with many undocumented Latino immigrants afraid to file wage claims over fears of deportation.

A 2016 state law, which applied to multiple fields, tightened up regulations on piece-rate compensation, which is traditional in the apparel industry and pays workers for every hem, seam and cuff they sew. That law mandated paid rest and recovery time and required more detailed payroll records.

Labor advocates say the rise of fast-fashion retailers such as Forever 21 has contributed to the problem. The L.A. company had been the poster child for alleged wage abuses before it faltered and filed for bankruptcy last year. The Los Angeles Times documented in 2017 how the company had been cited in nearly 300 claims since 2007 by workers demanding back pay for producing its clothing, yet Forever 21 had not paid anything because it was classified as a retailer.

More recently, labor advocates have been critical of Fashion Nova, one of the local industry’s rising stars – and were stunned to hear it had decided to support the proposed reforms.

Opponents contend the two companies are outliers and do not represent the practices of the L.A. apparel industry, where the use of subcontractors to assemble apparel has long been standard. They are calling for better enforcement of existing laws.

“This new law is all-encompassing, and it paints the whole industry as a bad apple – that is my problem. We are not all Fashion Nova and Forever 21,” said Ilse Metchek, president of the California Fashion Assn. trade group, who fears big chains such as Nordstrom and other retailers will stop contracting for apparel in the state. “You are picking the worst of the worst.”

Fashion Nova declined to comment on Metchek’s remarks but has announced reforms of its contracting practices. That includes a mandate that its contractors and subcontractors agree to random independent audits and that their workers are paid the applicable minimum wage, which in Los Angeles rises to $15 an hour for employers of all size next July.

$2.6 billion! That’s how much Tuft’s University research says it costs to bring a new drug from the research lab to the pharmacy counter. The full research, development and approval process can last from 12 to 15 years.

The U.S. Food and Drug Administration’s (FDA’s) Center for Drug Evaluation and Research (CDER) is a science-led organization in charge of overseeing the drug approval process before a drug is marketed. CDER ensures that both brand and generic drugs work correctly and that the health benefits outweigh the known risks.

In the manufacturer’s early phases of drug discovery (preclinical research) they are synthesizing and screening a drug candidate for toxicity in animals before the medicine moves on to human trials. The sponsor files an Investigational New Drug (IND) Application that details specifics such as chemistry, manufacturing and the initial plans for human testing.

A drug then undergoes several years of laboratory testing before a New Drug Application (NDA) is made to the FDA to begin testing the drug in humans. Only one in 1000 of the compounds that enter laboratory testing will ever make it to human testing.

If the FDA gives the green light, the investigational drug will then enter three phases of human clinical trials:

— Phase 1: About 20 to 80 healthy volunteers to establish a drug’s safety and profile, and takes about 1 year.
— Phase 2: Roughly 100 to 300 patient volunteers to assess the drug’s effectiveness in those with a specific condition or disease. This phase runs about 2 years.
— Phase 3: Typically, several thousand patients are monitored in clinics and hospitals to carefully determine effectiveness and identify further side effects.This phase runs about about 3 years on average.

For an NDA, the company writes and submits an application which includes thousands of pages to the FDA for review and approval. The NDA is the official request for US approval of a drug. The FDA team has 60 days to review the NDA and determine if it will be filed for further review.

A group of independent physicians and other clinicians, called an FDA Advisory Board, meets to discuss the NDA with the FDA reviewers and manufacturer of the product. These meetings often take one or two days. After the meeting, the Advisory Board will make a recommendation for approval, or not, to the FDA, usually through a vote. The FDA often follows the advice of the Board, but is not obligated to do so.

After final approval, the drug becomes available for physicians to prescribe. However, drugs may not come to the market immediately because of patents disputes, manufacturing issues, or controlled substance designation from the DEA.

The Division of Workers’ Compensation and Workers’ Compensation Appeals Board continue to improve their ability to hold hearings during the COVID-19 pandemic. The following changes are effective August 17.

DWC will continue to hear all mandatory settlement conferences, priority conferences, status conferences, case-in-chief trials, lien conferences and expedited hearings telephonically via the individually assigned judges’ conference lines as announced in newslines issued on April 3, April 28 and May 28.

Beginning August 17, DWC will have a video option available for trials and expedited hearings only. Parties will continue to use individually assigned judges’ conference lines on the day of trial. However, judges will have the option of conducting the trial through the judge’s virtual courtroom if needed. If that is required, the judge will provide a link to the parties allowing them to log into the video platform.

DWC will be using the video platform called LifeSize. Stakeholders should download the software prior to a hearing where a video option may become necessary. Neither DWC nor LifeSize will charge for participants to use the platform.

However, parties will need to have certain system requirements to fully participate in the video option. Parties will also need to have a web camera. Participants without access to a web camera may use a smart phone with the program, although it is not recommended. Additional information on LifeSize and how to use the program may be found on the DWC website.

All parties scheduled for a hearing should continue to call the conference line for the judge in front of whom the case is set, at the designated time listed on the hearing notice. When prompted, the parties should enter the access code assigned to that line. DWC staff will instruct participants as to the procedure to follow during the call.

DWC is in the process of updating its hearing notices to reflect the judges’ conference lines. That change will be implemented on or about August 15.

DWC has also begun hearing Special Adjudication Unit (SAU) lien trials. The same procedure described above will apply for SAU trials.

At this time all other lien trials will be continued. However, DWC anticipates adding lien trials back to the calendar in the near future.

District offices will not hold in-person hearings.

DWC will not accept walk-in filings, walk-through documents or in-person requests at this time. DWC will only accept electronic filing via EAMS and JET File, and paper filing by U.S. mail.

DWC will accept limited email filings pursuant to WCAB’s en banc decision dated April 6 and its newsline issued on April 23. Email filings are limited to documents that are subject to a statute of limitations that cannot otherwise be efiled, JET filed or filed by U.S. mail.

DWC will continue to accept an electronic signature on any settlement documents, applications, pleadings, petitions or motions that are sent to the district offices or filed in EAMS. For all e-forms, parties should utilize “S signature” as shown in the E-forms Filing Reference Guide and the JET File Business Rules.

Injured workers who are unable to file utilizing the available options or need assistance may contact DWC’s call center at 909-383-4522.

The WCAB office in San Francisco is operating with limited in-office staff. The WCAB commissioners and staff continue to work remotely. All practitioners are encouraged to regularly check the WCAB and DWC websites for updates about the district offices’ and the WCAB’s operations during this period.

On May 5, 2020, the Attorney General of California, joined by the City Attorneys of Los Angeles, San Diego, and San Francisco, filed a lawsuit on behalf of the People of the State California seeking injunctive relief, restitution, and penalties against Defendants Uber Technologies and Lyft.

The complaint asserts that Uber and Lyft have misclassified their ride-hailing drivers as independent contractors rather than employees in violation of Assembly Bill 5 , which took effect on January 1, 2020. That statute is intended to ensure that all workers who meet its criteria receive the basic rights and protections guaranteed to employees under California law.

On June 25, the People moved for a preliminary injunction enjoining Defendants from classifying their drivers as independent contractors, and from violating any provisions of the Labor Code, the Unemployment Insurance Code, and the wage orders of the Industrial Welfare Commission with regard to their drivers.

Defendants opposed the motion. They also filed three additional motions: a motion to stay the litigation; a demurrer and motion to strike the complaint; and a motion to compel arbitration.

Defendants sought to stay the litigation until the Ninth Circuit rules on Uber’s pending constitutional challenge to A.B. 5; until the November 2020 election, when the voters will consider Proposition 22, an initiative sponsored by Uber and Lyft that would exempt them from the requirements of A.B. 5; or until the final disposition of numerous lawsuits and arbitrations in which similar claims have been raised.

On August 10, the Court ruled on these pending motions after first declaring that “Defendants are not entitled to an indefinite postponement of their day of reckoning. Their threshold motions are groundless.” The case went downhill for the Uber and Lyft from there.

A footnote also proclaimed that the “Court gives no weight to Defendants’ surveys regarding how many of their drivers wish to become employees or remain self-employed. A. B. 5 may be unpopular among some of Defendants’ drivers, but a lawsuit is not a popularity contest. Nor, as Defendants and some amici curiae argue, is it this Court’ s role to decide whether A.B. S ‘s effects on drivers will outweigh its benefits. Policy judgments underlying a statute are left to the Legislature; the judiciary does not pass on the wisdom of legislation.” (

At the conclusion of the 34 page ruling, it was ordered that “During the pendency of this action, Defendants Uber Technologies, Inc. and Lyft, Inc. are hereby enjoined and restrained from classifying their Drivers as independent contractors in violation of Labor Code section 2570.3 .”

“Defendants are further enjoined and restrained from violating any provisions of the Labor Code, the Unemployment Insurance Code, and the wage orders of the Industrial Welfare Commission with regard to their Drivers.”

This injunction was stayed for a period of 10 days to allow the two companies an opportunity to appeal. Thereafter, “it shall remain in effect through and including the trial of this matter or upon further order of this Court.”

Uber said it planned to file an immediate emergency appeal to block the ruling from going into effect.