Category: Daily News

The US healthcare industry is undergoing significant disruptions as the coronavirus pandemic catalyzed the need for improved healthcare delivery and digital health startups are at the helm of this transformation.

Globally, healthcare funding to private firms reached $18.09 billion in Q2 2020, establishing a new quarterly record, with equity investments growing 6.3% quarter-over-quarter from 1,197 deals in Q1 2020 to 1,272 deals in Q2 2020.

In a new report, Insider Intelligence examined the top five US digital health startups in AI, telehealth, and medical devices – the areas of digital health with the most number of deals in the first half of 2020.

The companies mentioned in this report are: 98point6, Abbott, Aetion, Anthem, Bigfoot Biomedical, Biofourmis, Bright.md, Chugai, Cigna, Element Science, Firefly Health, Gaido Health, Genesis Health, Happify Health, K Health, Komodo Health, Mindstrong, Modern Fertility, Oak Street Health, Onera Health, Premera Blue Cross, Vicarious Surgical, and Virta Health.

Here are some key takeaways from this report:

— Digital health startups are transforming the US healthcare system amid the growing demand for improved healthcare delivery catalyzed by the coronavirus pandemic.
— The AI, telehealth, and medical device spaces are the three areas of healthcare where technology is causing the biggest disruptions. These spaces represent the digital health market areas that scored the most number of deals in the first half of 2020.
— AI’s ability to rapidly sift through vast sums of data, facilitate remote patient monitoring, and power digital therapeutics highlights the transformative power of the tech in healthcare – and it’s attracting substantial investor attention.
— Telehealth usage – and investments – have surged amid the coronavirus pandemic, underscoring how virtual care solutions are already making a sizable impact on the US healthcare delivery landscape.
— The medical device market, with tech ranging from remote monitoring devices to robotics-based surgical tools, is experiencing record-breaking investment activity.

The full report:

— Highlights how the coronavirus pandemic has accelerated growing demand for improved healthcare delivery, and the steps digital health startups are taking to transform the US healthcare system.
— Provides an overview of the three areas of healthcare where technology is causing the biggest disruptions – AI, telehealth, and medical devices – and the factors making these markets particularly ripe for transformation.
— Identifies the top 5 US startups to watch in the AI, telehealth, and medical device market areas.
— Shares forward-looking insights on what’s next for each of the featured startups.

A Santa Monica day spa owner was just charged in federal court with accumulating N95 respirators in anticipation of the COVID-19 pandemic and then price gouging by selling the scarce masks at vastly inflated prices – sometimes nearly 1,100 percent over list price.

Niki Schwarz, 55, of Santa Monica, the owner of Tikkun Holistic Spa, was named in a criminal information charging her with one count of hoarding and price gouging. In a plea agreement also just filed, Schwarz agreed to plead guilty to the misdemeanor offense.

In the plea agreement, Schwarz admitted that in February she began accumulating N95 respirators in anticipation of a shortage that would be caused by a global pandemic resulting from the spread of the novel coronavirus. From the beginning of February until the end of June, Schwarz accumulated nearly 20,000 N95 masks that had been manufactured by 3M (list price ranging from $1.02 to $1.27) and Alpha Pro (list price of 86 cents).

In March, the United States government designated N95 respirators as “scarce materials” under the Defense Production Act of 1950 due to the overwhelming need of health care providers dealing with COVID-19 patients to use personal protective equipment.

Schwarz admitted that she obtained the N95 respirators for the purpose of reselling them at above-market rates, and that she sold the masks for up to $15 each.

Schwarz “accumulated and resold the masks at prices in excess of the prevailing market prices willfully, that is, with knowledge that masks had been designated as scarce materials and with knowledge that accumulation of the designated materials to resell in excess of prevailing market prices was unlawful,” according to the plea agreement.

On March 1, an associate informed Schwarz that the associate was going to stop selling N95 masks because she believed it was crime – and that price gouging could result in one year in prison – but Schwarz continued to sell the masks at inflated prices.

The hoarding and price gouging offense that Schwarz admits in the plea agreement carries a statutory maximum sentence of one year in federal prison.

The case is being prosecuted by Assistant United States Attorney Jeff Mitchell of the Major Frauds Section, who is a regional coordinator of the Justice Department’s COVID-19 Hoarding and Price Gouging Task Force.

Jaime Chavez Jr. claimed injury to his left leg, right shoulder, bilateral knees, cervical spine, psyche, vision and internal system on October I 3, 2017 while employed as a tree trimmer by Cut It Right Tree Service.

He was assigned to cut multiple mulberry trees and a camphor tree. He was given a harness that was missing the right thigh strap. His task was to strip the three mulberry trees, to clear and shape them, and to clear and shape the camphor tree.

He became concerned, however, with how the ground crew was handling the debris. The brush was being moved in a manner that tangled his rope. He spoke with both the members of the ground crew to “stop playing with his life.” It appeared that they improved in their work.

But after lunch, approximately 3:00 p.m, he heard “an explosion.” He thought that the chainsaw had blown or the wood chipper. But his harness had cinched up and he saw that his leg had been ripped off and was hanging. As he came to realize later, the rope had wrapped around his leg, pulled tight, and then noticed that the left pant leg was now hanging flat. He knew that his leg had been popped out of the socket. As he understood later, the rope auto-amputated his leg from the knee down.

Mr. Chavez stated he had 15 years working in the tree trimming business. Prior to what happened to him, he has not heard of anyone suffering a leg amputation.

The matter proceeded to trial on February 3, 2020. The parties stipulated to injury AOE/COE to the following parts: left leg (amputation), right shoulder, bilateral knees and cervical spine. One of the issues was “sudden and extraordinary event.”

The WCJ commented in the Opinion on Decision “The defense contends that Applicant’s injuries are, first, barred by the six month rule. However, from a plain reading of the facts of this case, it is clear that this was both a “violent act” (as defined under Labor Code § 4660.1) and a “sudden and extraordinary” event (as defined under Labor Code § 3208.3). Thereby, Applicant is entitled to benefits for his psychiatric injuries, including the possibility of impairment benefits.

Defendants petition for reconsideration of this finding was denied in the panel decision of Chavez v Cut it Right Tree Service, SCIF.

The legislative and judicial history of section 3208.3(d) show that a “sudden and extraordinary” employment condition means something that is not regular and routine, and is uncommon, unusual and unexpected. (See Matea v. Workers’ Comp. Appeals Bd. (2006) 144 Cal.App.4th 1435, 1449 (71 Cal.Comp.Cases 1522].) The Court of Appeal in Matea acknowledged that “[g]as main explosions and workplace violence are certainly uncommon and usually totally unexpected events; thus, they may be sudden and extraordinary employment conditions.”

“Applicant’s unrebutted testimony reflects that the injury occurred so quickly that he did not initially realize what had happened until he saw his leg. Defendant’s contentions that applicant had “notice” that the injury would occur because of his warnings to co-workers to be careful with his rope are unpersuasive. The injury was caused by a sudden employment condition.”

Mallinckrodt filed for bankruptcy protection on Monday, saddled with lawsuits alleging it helped fuel the U.S. opioid epidemic. They are the third major durgmaker to seek bankruptcy protection.

The company had said in February it planned to have its generic drug business file for bankruptcy as part of a tentative $1.6 billion opioid settlement to resolve claims by state attorneys general and U.S. cities and counties.

Last March, the company also lost a court battle to avoid paying higher rebates to state Medicaid programs for its top-selling drug.

In September, Mallinckrodt hired restructuring advisers to help limit its liabilities regarding the opioid settlement and a potential restructuring. The opioid litigation had caused some concern at the company, including a suspension of its plans to spin off its generics business into a standalone entity due to the opioid litigation, as well as “market conditions.”

Mallinckrodt said on Monday it had agreed to pay $1.6 billion over several years to settle opioid-related litigation. About $450 million would be paid as part of its settlement once the company emerged from chapter 11 bankruptcy.

The company would then pay $200 million in the first and second year after its emergence from the bankruptcy, and $150 million subsequently through the seventh year.

Mallinckrodt had agreed to pay $260 million over seven years to resolve disputes related to its multiple-sclerosis drug H.P. Acthar gel and pay out rebates to state Medicaid programs.

Mallinckrodt also plans to dismiss its appeal to a March ruling related to Acthar gel, whose price per-vial has risen from about $50 in 2001 to $38,892 in 2019.

During the bankruptcy protection, the company said it aims to resolve opioid-related claims and reduce its debt by about $1.3 billion, while surviving on cash on hand and cash generated from operations.

The company listed both assets and liabilities in the range of $1 billion to $10 billion in a filing with the U.S. Bankruptcy Court for the District Of Delaware.

Under terms of the settlement announced this morning, the court-supervised process will lead to the creation of a trust, which, as the company said, will “establish an abatement fund to offset the expense of helping to combat opioid addiction and providing support to communities impacted by opioid abuse.” The court-supervised process is also expected to resolve all opioid-related claims against Mallinckrodt and its subsidiaries, the company said.

Mark Trudeau, president and chief executive officer of Mallinckrodt, said reaching the agreement and undergoing debt refinancing are important steps moving the company forward.

“Importantly, when finalized, we believe the proposed settlement and capital restructuring activities will provide us with a clear path forward to achieving our long term strategy, preserving value for our financial stakeholders and providing us with the flexibility to operate effectively,” Trudeau said in a statement.

Trudeau continued but adding that, while the company has had some uncertainties, it has delivered strong earnings and has a strong pipeline that continues to “build momentum.” Trudeau said the company anticipates seeking regulatory approval of terlipressin and StratGraft in the coming months, as well as the completion of key clinical study results and data readouts across the portfolio.

Charles Lewis filed a claim for an injury against Horizon Christian Fellowship that occurred on May 11, 2015 and also filed a cumulative trauma, a lower back injury, that he alleged occurred from April 11, 2016 to April 11, 2017.

Horizon was insured by GuideOne Mutual Insurance From March 1, 2015 to June 1, 2017, and was insured by Brotherhood Mutual Insurance Company from February 28, 2013 to February 28, 2015. On August 30, 2018 GuideOne filed a Petition for Joinder of Brotherhood as an additional party under Labor Code section 5500.5.

GuideOne and Lewis entered a Joint Compromise and Release which the WCJ approved on September 17, 2018. Brotherhood was joined as a party on October 16, 2018.

On January 18, 2019, GuideOne filed a Declaration of Readiness to Proceed on the issues of “Joinder Order issued 10/16/2018,” and that the complete file had been served on Brotherhood on 11/19/2018.

On January 31, 2019, Brotherhood filed an objection to the Declaration of Readiness to Proceed, stating it had not received the complete file and that it had subpoenaed additional records, which were needed before a hearing takes place on contribution issues.

on October 21, 2019, GuideOne filed another Declaration of Readiness for a Mandatory Settlement Conference (MSC) on the issue of Contribution/Arbitration and the conference was set for December 18, 2019. During the conference, Brotherhood “reserved its defense of untimely filing of the Petition for Contribution” as an issue for the arbitrator.

Brotherhood argued that GuideOne’s claim for contribution was barred because it had not timely submitted a pleading titled “Petition for Contribution” by September 17, 2019, one year after the Compromise and Release was approved. GuideOne argued that its January 18, 2019 Declaration of Readiness was sufficient to initiate contribution proceedings.

The arbitrator issued an order rejecting Brotherhood’s arguments, and noted in his decision that although a better practice is the filing of an actual petition for contribution that clears any confusion, he concluded that the Declaration of Readiness was sufficient to initiate the contribution proceeding.

The WCAB denied reconsideration. The fourth district Court of Appeal affirmed the arbitrator in its minute order of a Summary Denial in the case of Brotherhood Mutual Insurance Company v. WCAB, Guideone Mutual Insurance Company et al. Case Number D 077799.

In general the WCAB has inherent power to control its practice and procedure to prevent frustration, abuse, or disregard of its processes.” (Crawford v. Workers’ Comp. Appeals Bd. (1989) 213 Cal.App.3d 156, 164.) A review of a decision of the WCAB is limited to whether the WCAB acted without or in excess of its powers and whether the order, decision or award was unreasonable, not supported by substantial evidence or procured by fraud. (Lab. Code § 5952.)

Rule 10510 states, “After jurisdiction of the Workers’ Compensation Appeals Board is invoked pursuant to rule 10450, a request for action by the Workers’ Compensation Appeals Board, other than a rule 10500 form pleading, shall be made by petition.”

The WCAB has previously concluded a Declaration of Readiness is sufficient under that statutory provision and rule 10510 to initiate proceedings. (See Old Republic Ins. Co. v. Workers’ Comp. Appeals Bd. (Bennett) (2010) 75 Cal.Comp.Cases 168, 169 (Bennett).) As the WCAB found in Bennett, neither section 5500.5, subdivision (e) or rule 10510 specify that a petition is required in this circumstance. Section 5500.5, subdivision (e) does not specify what document must be used to initiate a contribution proceeding and rule 10510 contains an explicit exception for the use of a Declaration of Readiness.