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AI Used to Discover New Antibiotic for Deadly Superbug

Scientists used artificial intelligence to identify a new antibiotic that might be useful to fight a deadly drug-resistant bacteria commonly found in hospitals and medical offices. The study has just been published in the journal Nature Chemical Biology. The newly discovered drug – Abaucin is a narrow-spectrum antibiotic that is effective against Acinetobacter baumannii, a superbug that is resistant to many antibiotics. Abaucin works by inhibiting the transport of lipoproteins, which are essential for the growth and survival of bacteria. It has now also been shown to be safe in animal studies

Abaucin was developed by a team of researchers led by James J. Collins at the MIT Jameel Clinic and Jonathan Stokes at McMaster University. The team used an artificial intelligence algorithm to screen thousands of compounds for potential antibiotic activity. Abaucin was one of the compounds that was identified by the algorithm.

Abaucin works by inhibiting lipoprotein transport, which is essential for bacterial growth. It is a narrow-spectrum antibiotic, which means that it is only effective against a few types of bacteria. This makes it less likely to cause resistance to develop. Abaucin is still in the early stages of development, but it has the potential to be a valuable new tool for treating infections caused by Acinetobacter baumannii.

There’s a lot of trepidation around AI and I genuinely understand it,” said Jonathan Stokes, lead author on the paper and an assistant professor of biomedicine and biochemistry at at McMaster University in Ontario, Canada. “When I think about AI in general, I think of these models as things that are just going to help us do the thing we’re going to do better.

According to a report by USA Today, Stokes teamed up with researchers from the Broad Institute of MIT and Harvard to screen for potential antibiotics to use on Acinetobacter baumannii, a superbug that can cause infections in the blood, urinary tract and lungs. This bacteria usually invades hospitals and healthcare settings, infecting vulnerable patients on breathing machines, in intensive care units and undergoing operations.

This type of bacteria, resistant to the potent antibiotic carbapenem, infected 8,500 in hospitals and killed 700 in 2017, according to the Centers for Disease Control and Prevention.

Stokes said the lab team developed AI models to predict which ones would have the highest likelihood of antimicrobial activity, narrowing the field to 240 drugs or active ingredients. Researchers then narrowed the field again through testing before discovering a molecule RS102895, renamed abaucin, that appeared to be potent against the superbug.

“It’s important to remember right when we’re trying to develop a drug, it doesn’t just have to kill the bacterium,” Stokes said. “It also has to be well tolerated in humans and it has to get to the infection site and stay at the infection site long enough to elicit an effect.”

Researchers said they can screen a much larger volume of potential drugs by using machine-learning techniques. The study said while existing high-throughput screening can evaluate a few million drugs or chemical ingredients at once, algorithms developed from machine learning can assess “hundreds of millions to billions” of drug molecules.

There are other examples of AI being used to develop new drugs:

– –  Exscientia is a pharmaceutical company that uses AI to design new drugs. The company has developed several drugs that are now in clinical trials, including a drug for Alzheimer’s disease and a drug for cancer.
– –  Insilico Medicine is another pharmaceutical company that uses AI to develop new drugs. The company has developed several drugs that are now in preclinical trials, including a drug for Parkinson’s disease and a drug for HIV.
– –  Atomwise is a company that uses AI to design new drugs for infectious diseases. It has developed several drugs that are now in preclinical trials, including a drug for malaria and a drug for tuberculosis.
– –  BenevolentAI is a company that uses AI to develop new drugs for rare diseases. It has developed several drugs that are also now in preclinical trials, including a drug for Duchenne muscular dystrophy and a drug for cystic fibrosis.

These are just a few examples of the many companies that are using AI to develop new drugs. AI has the potential to revolutionize the drug discovery process, and it could help to develop new treatments for a wide range of diseases.

California Supreme Court Expands Employee Whistleblower Protections

A.C.R. worked as a bartender at Kolla’s, Inc., a nightclub in Orange County. In 2014, A.C.R. complained to Gonzalo Estrada that she had not been paid wages owed for her previous three shifts of work. Estrada responded by threatening to report A.C.R. to immigration authorities, terminating her employment, and telling her never to return to the club.

In June 2014, A.C.R. filed a complaint against Estrada and Kolla’s with Department of Labor Relations, Division of Labor Standards Enforcement (DLSE), which opened an investigation.

After determining that Estrada’s immigration-based threats and termination of A.C.R. violated California law, DLSE notified Estrada and Kolla’s of proposed remedies, including payment of lost wages to A.C.R., reinstatement of A.C.R.’s previous position, and payment of civil penalties to A.C.R. and DLSE. After Estrada and Kolla’s declined to accept DLSE’s proposed remedies, the Labor Commissioner sued them for violations of the Labor Code, including retaliation in violation of section 1102.5(b).

The trial court entered an order granting in part the Labor Commissioner’s application for default judgment but ruled against the Labor Commissioner on the section 1102.5(b) claim. The court held that the Labor Commissioner did not state a valid cause of action under section 1102.5(b) because A.C.R. reported her complaints to her employer rather than a government agency. The Labor Commissioner appealed.

The Court of Appeal held that the trial court had relied on an outdated version of section 1102.5(b) and that the current version of the law protects disclosures made to one’s employer. The Court of Appeal nonetheless affirmed the trial court’s judgment on the section 1102.5(b) claim, concluding that a private employee’s report of unlawful activity directly to his or her wrongdoing employer is not a protected disclosure under section 1102.5(b).

The Court of Appeal explained that Estrada, as the owner of the nightclub, “was at least aware of – if not responsible for – the non-payment of wages” and that an ” ’employee’s report to the employee’s supervisor about the supervisor’s own wrongdoing is not a “disclosure” and is not protected whistleblowing activity, because the employer already knows about his or her wrongdoing.’ ”

The California Supreme Court reversed and remanded, and held that a protected disclosure under section 1102.5(b) encompasses reports or complaints of a violation made to an employer or agency even if the recipient already knows of the violation. It further concluded that complainant A.C.R. made a disclosure protected by section 1102.5(b) in the case of P. ex rel. Garcia-Brower v. Kolla’s, Inc. – S269456. (May 2023).

The Legislature enacted section 1102.5 in 1984 to provide whistleblowers with protection from employer retaliation. In 2003, in the wake of a “recent spate of false business reports and other illegal activity by Enron, WorldCom and others,” the Legislature amended section 1102.5(b) to include several additional employee protections.

In 2013, the Legislature again amended section 1102.5(b), expanding its protections to include an employee’s disclosure made “to a person with authority over the employee or another employee who has the authority to investigate, discover, or correct the violation or noncompliance.”

The Supreme Court has repeatedly held that section 1102.5(b) “reflects the broad public policy interest in encouraging workplace whistle-blowers to report unlawful acts without fearing retaliation.” (Green v. Ralee Engineering Co. (1998) 19 Cal.4th 66, 77 (Green); Lawson v. PPG Architectural Finishes, Inc. (2022) 12 Cal.5th 703, 709 (Lawson); Soukup v. Law Offices of Herbert Hafif (2006) 39 Cal.4th 260, 287.)

It is undisputed that the employer’s conduct was prohibited by the Labor Code. The question here is whether a report of unlawful activities made to an employer or agency that already knew about the violation was a protected “disclosure” within the meaning of section 1102.5(b).

The Supreme Court concluded that it was, noting that “Applying the Court of Appeal’s reasoning here would result in outcomes contrary to the Legislature’s purpose.”

And it disapproved Mize-Kurzman v. Marin Community College Dist., 202 Cal.App.4th 832 to the extent it is inconsistent with its opinion. Mize-Kurzman rested on federal precedent subsequently abrogated by Congress. In 2012, Congress passed the Whistleblower Protection Enhancement Act of 2012 (WPEA) (Pub.L. No. 112-199 (Nov. 27, 2012) 126 Stat. 1465), an update to the Whistleblower Protection Act (WPA), that “clarif[ied] the broad meaning” of disclosure to correct Federal Circuit precedent that had “wrongly accorded a narrow definition to the type of disclosure that qualifies for whistleblower protection.”

NSC Publishes Research on Improving Workplace Safety with Robotics

A new report by the National Safety Council builds on the Work to Zero Safety Innovation Journey to help organizations assess risks, identify technology solutions and ready workplaces for implementation.

Specifically, this white paper, which analyzes academic journals, vendor interviews and company case studies, evaluates the benefits of robotics and autonomous mobile robots, or AMRs, on reducing injuries and fatalities in the workplace. It also outlines best practices employers can follow to implement robotic technology across a range of workplaces.

For this white paper, Work to Zero identified the five most common robot configurations available to employers – AMRs, Automated Guided Vehicles or AGVs, Articulated Robots, Humanoid Robots and Cobots – to assess their key benefits and applications. In addition to concluding this technology can be ideal for manufacturing applications, where repetitive, high-volume production is necessary, the report identified several other examples in which employers can use robots to create safer outcomes for their workers, including:

– – Inspecting confined spaces and industrial facilities. Organizations in the construction, mining and logging industries may especially benefit from using wheeled AMRs to remove human workers from on-site hazards.
– – Transporting parts, goods and materials. Used alongside sensors and computer vision, AMRs and AGVs can minimize the risk of human-machine collisions.
– – Using robotic arms for precision cutting and welding, as well as the safe handling of toxic, high-temperature or explosive materials.
– – Machine tending and parts repositioning by using robotic arms and AMRs to reduce risks associated with manual machine handling.

Work to Zero also found adopting robotic technology can help employers mitigate the risk of workplace musculoskeletal disorders, prevent falls from heights and reduce worker muscle fatigue. However, several barriers to widespread robot adoption exist.

While recent advancements have reduced the price and increased the viability of robotics for common industrial applications, costs of implementation and ongoing maintenance may still be prohibitive for smaller industrial operations.

Additionally, Work to Zero found AVG and AMR configurations may be disruptive to some work environments or need to be coupled with additional safety technologies to effectively mitigate risk. This underscores that, despite the many benefits, employers must tailor their robotic technology to meet their unique safety needs and drive the return on investment.

There is also an enduring concern that robotics or other technology may eventually replace human workers, but the report noted that, in addition to robotics having the potential to improve efficiency and safety, increased automation may help businesses reduce costs overall, which can lead to increased investments and the creation of new jobs in other areas, especially in engineering, maintenance and programming.

Ultimately, this white paper found the importance in having a proactive approach to addressing the potential consequences of automation, such as retraining and reskilling programs for displaced workers, and ensuring the benefits of automation are shared equitably across organizations.

Santa Clara Jury Awards $2M to Deaf Package Handler for Discrimination

Late Friday, a Santa Clara County jury awarded $2 million to Younes Mchaar, a deaf, low-wage, former FedEx Ground part-time package handler who was repeatedly denied reasonable accommodations and the interactive process at the company’s San Jose facility.

The jury verdict also found that FedEx failed to prevent this discrimination against him despite FedEx Ground having previously been sued by the U.S. Equal Employment Opportunity Commission (EEOC) on behalf of deaf package handlers nationwide.

According to a press release by his attorneys, Mr. Mchaar, who has been deaf since birth, began working at FedEx Ground in 2011 as a part-time package handler in Virginia.

Mchaar alleged in his lawsuit, filed in 2020, that after FedEx in Virginia denied him promotions and proper interpretive services from 2011 to 2017, he moved to the San Jose position – anxious, stressed and frustrated but seeking a better workplace and higher pay.

Mr. Mchaar transferred to the company’s San Jose, California facility in April 2017, anticipating reasonable accommodations to assist in routine communications. But it took until December 2017 for the company to arrange a meeting with him about reasonable accommodations.

At that point, FedEx agreed to provide American Sign Language (ASL) interpreters for all safety meetings and Video Remote Interpreting VRI for daily meetings. Nonetheless, the ASL interpreters were often not present at safety meetings, and the VRI did not even arrive at the facility until June 2018 – after which, it was glitchy.

He also discovered that just as in Virginia, “FedEx promoted and assigned important projects to less-qualified, non-deaf employees,” according to his lawsuit.

After Mr. Mchaar vigorously complained about denied reasonable accommodations, he was written up 10 times in 2 ½ months and proposed for termination, at which point he resigned.

According Mercury News, FedEx said in an emailed statement Tuesday that it disagreed with the verdict and was reviewing its options for an appeal. The firm said it “remains committed to the fair and equal treatment of all team members, including our employees who are deaf and hard of hearing, for whom we strive to provide every opportunity for success.”

Throughout Mchaar’s employment in San Jose, the package-delivery titan had been fighting the U.S. Equal Employment Opportunity Commission in federal court over its treatment of deaf package handlers.

“Shipping giant FedEx Ground Package System, Inc., (FedEx Ground) violated federal law nationwide by discriminating against a large class of deaf and hard-of-hearing package handlers and job applicants for years”, the U.S. Equal Employment Opportunity Commission (EEOC) charged in a lawsuit it announced.

The EEOC says that FedEx Ground failed to provide needed accommodations such as American Sign Language (ASL) interpretation and closed-captioned training videos during the mandatory initial tour of the facilities and new-hire orientation for deaf and hard-of-hearing applicants. The shipping company also failed to provide such accommodations during staff, performance, and safety meetings. Package handlers physically load and unload packages from delivery vehicles, place and reposition packages in FedEx Ground’s conveyor systems, and scan, sort and route packages.  

The EEOC charges that, in addition to failing to provide communications-based accommodations for mandatory meetings, FedEx Ground refused to provide needed equipment substitutions and modifications for deaf and hard-of-hearing package handlers, such as providing scanners that vibrate instead of beep and installing flashing safety lights on moving equipment.  

The EEOC, after a nationwide investigation, sued FedEx in 2014 (No. 2:15-cv-00256 (W.D. Pa. May 18, 2020) ) under the Americans with Disabilities Act. The agency alleged the company failed to provide reasonable accommodations for deaf and hard-of-hearing package handlers that would let them perform essential job functions, communicate with managers, and participate in meetings. The agency further alleged that FedEx failed to provide flashing lights for safety on motorized moving equipment.

In 2020, to resolve the nationwide lawsuit, FedEx agreed to pay $3.3 million to up to 229 people, and agreed in a consent decree to provide deaf and hard-of-hearing package handlers with live and video American Sign Language interpreting, and scanning equipment with non-audible cues, such as vibration. The company also agreed to put warning lights on motorized equipment such as forklifts.

The company said Tuesday it has fully complied with the terms of the EEOC settlement agreement, which enabled the deal to expire in May 2022.

The lawsuit is Santa County Superior Court Case No. 20CV366270.

AI Device Restores Function so Paralyzed Patient Can Walk

Grégoire Courtine, a French-born neuroscientist at École Polytechnique Fédérale de Lausanne in Switzerland, is the International Paraplegic Foundation chair in spinal cord repair at the Center for Neuroprosthetics and the Brain Mind Institute at the Swiss Federal Institute of Technology in Lausanne.

Courtine and Jocelyne Bloch of HBP partners EPFL and CHUV have created a device that allows patients with total spinal cord injuries to stand, walk, and even participate in recreational activities such as swimming, cycling, and canoeing. The device is called a “digital bridge.”

The “digital bridge” device is a breakthrough study that could represent a quantum leap in the treatment of certain brain and central nervous system injuries. The device uses artificial intelligence to decode brain signals that enable the patient to move around independently.

“When there’s a spinal cord injury, the brain is disconnected from the spinal cord, so the communication is interrupted,” said Courtine during a press call Tuesday. “And what we’ve been able to do here is to reestablish the communication between the brain and the region spinal cord that controls leg movement with a digital bridge.”

That so-called “digital bridge” can effectively turn thought into actions – or, as Courtine put it, it can “capture thoughts” and translate them into a stimulation of the spinal cord.

According to the study published in the Journal Nature, the experimental treatment has been tried just once. Gert-Jan Oskan is a 40-year-old Dutch man who suffered a spinal cord injury in a bicycle accident. For nearly 12 years, he was unable to walk, step or stand. Courtine’s team implanted two devices, one into Oskan’s brain, and another into his spinal cord. The two devices communicate wirelessly, hence the digital bridge, or as the paper calls it, the “brain-spine interface,” or BSI.

Now, Oskan, whom Courtine calls the first “test pilot” of the newly invented system, has regained function in his knees, hips and ankle joints. He can walk – slowly, with the help of crutches – for about 300 to 600 feet. He can stand, with support from his hands, for two to three minutes at a time. He can even climb a few stairs.

Perhaps most remarkably, the treatment appears to work even after the system is shut off.

The implant has been life-changing, says Oskam. “Last week, there was something that needed to be painted and there was nobody to help me. So I took the walker and the paint, and I did it myself while I was standing,” he says.

When Oskam thinks about walking, the skull implants detect electrical activity in the cortex, the outer layer of the brain. This signal is wirelessly transmitted and decoded by a computer that Oskam wears in a backpack, which then transmits the information to the spinal pulse generator.

After around 40 rehabilitation sessions using the brain-spine interface, Oskam had regained the ability to voluntarily move his legs and feet. That type of voluntary movement was not possible after spinal stimulation alone, and suggests that the training sessions with the new device prompted further recovery in nerve cells that were not completely severed during his injury. Oskam can also walk short distances without the device if he uses crutches.

Bruce Harland, a neuroscientist at the University of Auckland in New Zealand, says that this continued improvement in spinal function is great news for anyone with a spinal-cord injury, “because even if it’s a longer-term chronic injury, there’s still a few different ways that healing could happen”.

“It’s certainly a huge jump” towards improved function for people with spinal-cord injuries, says neuroscientist Anna Leonard at the University of Adelaide in Australia. And, she says, there is still room for other interventions – such as stem cells – to improve outcomes further. She adds that although the brain-spine interface restores walking, other functions such as bladder and bowel control are not targeted by the device. “So, there’s certainly still room for other areas of research that could help progress improvements in outcomes for these other sort of realms,” she says.

Antonio Lauto, a biomedical engineer at Western Sydney University, Australia, says that less-invasive devices would be ideal. One of Oskam’s skull implants was removed after about five months because of an infection. Nevertheless, Jocelyne Bloch, the neurosurgeon at the Swiss Federal Institute of Technology who implanted the device, says that the risks involved are small compared with the benefits. “There is always a bit of risk of infections or risk of haemorrhage, but they are so small that it’s worth the risk,” she says.

Courtine’s team is currently recruiting three people to see whether a similar device can restore arm movements.

CWCI Studies Low-Volume – But High-Cost Driver Drugs

Part II of a California Workers’ Compensation Institute research series on low-volume/high-cost drugs used to treat California injured workers identifies three Dermatological drugs, three Opioids, and three Antidepressants that represent a relatively small share of the prescriptions within their therapeutic drug group, but due to high average reimbursements, have become cost drivers, consuming a disproportionate share of the payments.

The report reveals that Dermatologicals were the fourth most prevalent drug category in 2021, with 9.3% of the workers’ comp prescriptions, but ranked second (behind Anti-Inflammatories) in total drug spend, consuming 17.3% of all prescription drug payments. That was up from 12.8% in 2012, which the study ascribes to increased utilization and the emergence of high-priced topical analgesics. Diclofenac sodium topicals jumped from 0.5% of all workers’ comp prescriptions in 2012 to 5.4% in 2021 – fourth among all drugs dispensed that year, and they represented 58.1% of the 2021 Dermatological prescriptions, but with inexpensive generics widely available, their average reimbursement was a relatively low $65, so they consumed only 23.5% of the Dermatological dollars. In contrast, the study notes three other low-volume/high-priced drugs that have become Dermatological cost drivers:

– – Diclofenac sodium and adhesive sheets (dispensed as Xrylix kits, in 2021 these kits accounted for just 0.3% of the Dermatological prescriptions, but with an average payment of $4,126, they consumed 7.2% of the dermatological drug spend).
– – Lidocaine/menthol (this drug was dispensed in various forms, but NuLido gel and Terocin patches were key cost drivers. Lidocaine/menthol represented only 1% of the Dermatologicals dispensed in 2021, but at an average of $1,050 per prescription, it accounted for 6.2% of the Dermatological payments.
– – Diclofenac epolamine (dispensed as Flector patches at an average of $570 per prescription, or as generic equivalents at an average of $577, diclofenac epolamine comprised just 1.7% of the 2021 Dermatological prescriptions, but 5.9% of the payments within the group).

Opioid use in workers’ comp has been falling for more than a decade and with the adoption of Opioid and Pain Management Treatment Guidelines in late 2017 and a Formulary in 2018, Opioids’ share of the prescriptions continued to drop, falling to 9.4% in 2021 (down from 29.4% in 2012), while their share of the total drug spend fell to 5.8% (down from 26.7% a decade earlier). At the same time, the mix of Opioids used to treat injured workers shifted. The study noted three low-volume/high-priced Opioids that have become cost drivers within their group:

– – Buprenorphine, typically used to treat Opioid Use Disorder for patients in Medication-Assisted Treatment plans, in 2021, it accounted for 5.2% of the workers’ comp Opioids, and with an average payment of $363, it consumed 35.4% of the total Opioid reimbursements – more than any other Opioid.
– – Tapentadol HCl, used when other pain medications do not work well or cannot be tolerated, but only available as a brand drug (Nucynta or Nucynta Extended Release) it represented just 0.6% of the Opioid prescriptions, but at $590 per prescription, it accounted for 6.4% of the total Opioid drug spend.
– – Oxycodone, prescribed for moderate to severe pain, is available in a variety of generic and brand formulations, including extended-release and abuse-deterrent varieties. In 2021, 5.9% of Opioid prescriptions were for oxycodone, and at $145 per prescription, it consumed 16.0% of all Opioid payments.

The top four Antidepressants dispensed to injured workers in 2021 represented nearly 2/3 of the Antidepressants used, but all four were relatively low-cost drugs, so they accounted for only 42.5% of the payments in this drug group. In contrast, the study identified three low-volume/high-priced drugs that consumed a disproportionate share of the Antidepressant drug spend:

– – Vortioxetine HBr, used to treat Major Depressive Disorder, remains under patent and is only available as brand-name Trintellex. Available in 5, 10, and 20 mg tablets, this drug carries a black box warning noting an increased risk of suicidal thoughts and behaviors. In 2021, only 1.0% of the Antidepressant prescriptions in California workers’ compensation were for Vortioxetine HBr, but with an average reimbursement of $476, this drug comprised 12.4% of all Antidepressant payments.
– – Desvenlafaxine, an extended-release tablet that comes in various strengths, is used to treat major depression. It is available as a brand drug (Khedezla, Pristiq), with average payments as high as $642 per prescription, but since the introduction of generic versions in 2017, brand versions have declined to 14 to 15% of the prescriptions. Payments for generic desvenlafaxine averaged $58 to $66 from 2019 to 2021, which helped drive down the average reimbursement for this drug. In 2021, desvenlafaxine represented 1.0% of workers’ comp Antidepressants, but the average payment was still $131, so it accounted for 3.5% of the Antidepressant payments.
– – Bupropion HCl is used to treat depression, anxiety, and other mood disorders, and to aid smoking cessation. Available as a brand drug (Wellbutrin, including an extended-release version that tends to be very expensive), or in generic versions, which accounted for 98% of the Bupropion HCl dispensed to injured workers in 2021. Unlike generics, where the average payment declined from $121 in 2012 to $25 in 2021, over that same decade average reimbursements for brand versions of bupropion HCl increased nearly 10-fold from $267 to $2,614. The dominance of generic buproprion HCl has helped contain the total payments for this drug, but the 2% of the prescriptions dispensed as high-cost brand drugs drove the average payment up to $77 in 2021 — more than three times the $25 average paid for generics. As a result, bupropion HCl, which accounted for 7.6% of the Antidepressant prescriptions in 2021, consumed 16.3% of the Antidepressant payments.

CWCI has published more details and analyses on these drugs in a Spotlight Report, Cost-Driver Medications in the Top California Workers’ Comp Therapeutic Drug Groups: Part II, Dermatologicals, Opioids, and Antidepressants. Institute members and subscribers can log on to www.cwci.org and access the report under the Research tab, others can purchase a copy from the CWCI’s online store. Part III of CWCI’s research on low-volume/high-cost medications will focus on medications found in the Musculoskeletal and Ulcer drug categories.

Sunnyvale Company Announces AI Underwriting for Work Comp

Mulberri is a software company that provides a cloud-based platform for small and medium-sized businesses (SMBs) to purchase and manage insurance.The company was founded in 2016 by Hamesh Chawla and is headquartered in Sunnyvale, California.

Mulberri’s platform uses artificial intelligence (AI) to automate the insurance buying process, making it easier and faster for SMBs to find the right coverage at the best price. The company’s customers include businesses in a variety of industries, including retail, healthcare, and technology.

Mulberri just announced the launch of its Risk Engine, a first of its kind risk assessment offering for workers compensation underwriters. The Risk Engine, which is already being deployed by customers like Paychex’s PEO department, uses machine learning models to put the information underwriters need at their fingertips, making it possible to make fast, accurate decisions.

Workers’ comp is a multi-billion-dollar market, but most existing underwriting processes have not taken full advantage of the power of data, especially AI. Mulberri designed its Risk Engine to meet the needs of underwriters and their customers, extending Mulberri’s existing portfolio of insurance products for payroll businesses, HR providers, brokers and small-medium businesses.

“Our mission from day one has been to leverage technology to complement underwriters’ judgment so that the business insurance process can be simple, efficient, and transparent,” said Hamesh Chawla, CEO and cofounder of Mulberri. “The Risk Engine is a transformative step forward.”

Mulberri trained its Risk Engine to determine factors that impact claims based on millions of pieces of information including firmographic information, previous loss experience and workers compensation information. The cloud-based product allows intuitive access to predictions on demand from any SaaS application as well as easy deployment. It also enables users to analyze and score prospects one at a time or in bulk. All data is obfuscated, so PII remains safe.

It allows underwriters to make predictions for:

– – Claim Propensity – Likelihood of an insured filing a claim in twelve months
– – Claim Frequency – Claim repetition in twelve months
– – Claim Severity – Severity of the claim should it occur
– – Loss Ratio – Likelihood of the loss ratio getting worse than a profitable level

Mulberri has won the following awards from Insurtech:

– – 2023 Insurtech Innovation Award for Best Insurtech Solution for PEOs and Brokers
– – 2023 Insurtech Rising Star Award
– – 2023 Insurtech Best of Show Award

To learn more about the Mulberri Risk Engine and get a demo , sign up at mulberri.io

Arbitrator Awards Humana $642M in Walgreens Pricing Dispute

In 2019 , health insurance giant Humana filed an arbitration claim against Walgreens, a major drugstore chain, alleging that Walgreens had submitted millions of falsely-inflated prescription drug prices for more than a decade. This case arises from Walgreens’ longstanding contracts with Humana to reimburse Walgreens for prescription drugs it dispensed at its pharmacies to people insured by Humana.

The dispute centered on the way that Walgreens calculates the “usual and customary” price of prescription drugs. Humana alleged that Walgreens had been inflating these prices in order to overcharge the insurer. Walgreens denied these allegations and said that it was simply following the terms of its contracts with Humana.

The arbitrator was Elliot Gordon, a retired federal judge. After a lengthy hearing, the arbitrator ruled in favor of Humana and awarded the insurer $642 million in damages.

Walgreens has filed a petition in federal court to vacate the arbitration award, arguing that the arbitrator “rewrote” its contracts with Humana and used a flawed model to assess alleged damages. Walgreens acknowledges that the bar for vacating an arbitration award is high. But they say “it is not insurmountable, however.”

According to the Federal Arbitration Act (FAA), a party can appeal an arbitration award if the original award contains material and prejudicial errors of law of such a nature that it does not rest upon any appropriate legal basis, or is based upon factual findings clearly unsupported by the record; or if the original award is subject to one or more of the grounds set forth in Section 10 of the FAA for vacating an award.

Walgreens also claims that law firm Crowell & Moring should not have been allowed to represent Humana after previously advising Walgreens years earlier on drug pricing matters at the heart of Humana’s 2019 arbitration. Crowell has denied any conflict of interest in representing Humana against the law firm’s former client Walgreens2.

Walgreens last year sued Crowell & Moring in District of Columbia Superior Court to immediately stop the large law firm from representing insurer Humana Health Plan Inc in the arbitration with Walgreens over drug pricing, contending Crowell, as its former firm, has violated its ethical duty. A judge in May 2021 ruled that Walgreens’ push for a preliminary injunction against Crowell belonged in front of the arbitrator. Walgreens appealed, and the drug-pricing arbitration moved ahead with Crowell remaining as counsel to Humana.

Washington, D.C.-based Crowell has denied any conflict of interest in representing Humana against the law firm’s former client Walgreens. A spokesperson for Crowell on Monday in a statement reviewed by Reuters called Walgreens’ ethics claim “meritless” and said the firm was “confident that the arbitrator’s thorough and well-reasoned award will be affirmed.”

Walgreens also argues that the arbitrator’s award is “manifestly unjust” and should be vacated on that ground as well.

Humana has responded to Walgreens’ petition, arguing that the arbitrator’s award should be confirmed. Humana argues that the arbitrator correctly found that Walgreens breached its contracts and that the damages award is supported by the evidence. Humana also argues that the arbitrator did not abuse its discretion and that the award is not manifestly unjust.

The outcome of the case could have a major impact on the pharmaceutical industry and the cost of prescription drugs.If the arbitrator’s award is upheld, it could set a precedent that would make it more difficult for pharmacies to inflate prescription drug prices. This could lead to lower prices for patients and could help to reduce the overall cost of healthcare.

The outcome of the case is also significant because it could impact the way that arbitration is used to resolve disputes in the pharmaceutical industry.

FTC Targeting Drugmaker Mergers and PBM Industry Middlemen

The Federal Trade Commission is seeking to block biopharmaceutical giant Amgen Inc. from acquiring Horizon Therapeutics plc, saying the deal would allow Amgen to leverage its portfolio of blockbuster drugs to entrench the monopoly positions of Horizon medications used to treat two serious conditions, thyroid eye disease and chronic refractory gout.

The FTC filed a lawsuit in federal court this month to block the transaction, saying it would enable Amgen to use rebates on its existing blockbuster drugs to pressure insurance companies and pharmacy benefit managers (PBMs) into favoring Horizon’s two monopoly products – Tepezza, used to treat thyroid eye disease, and Krystexxa, used to treat chronic refractory gout. Neither of these treatments have any competition in the pharmaceutical marketplace.

Rampant consolidation in the pharmaceutical industry has given powerful companies a pass to exorbitantly hike prescription drug prices, deny patients access to more affordable generics, and hamstring innovation in life-saving markets,” said FTC Bureau of Competition Director Holly Vedova. “Today’s action – the FTC’s first challenge to a pharmaceutical merger in recent memory – sends a clear signal to the market: The FTC won’t hesitate to challenge mergers that enable pharmaceutical conglomerates to entrench their monopolies at the expense of consumers and fair competition.”

The proposed acquisition is the largest pharmaceutical transaction announced in 2022. Given how central protecting and growing Tepezza and Krystexxa monopoly revenues are to the deal valuation Amgen calculated for Horizon, Amgen has strong incentives post-acquisition to raise Tepezza and Krystexxa rivals’ barriers to entry or dissuade them from competing as aggressively if and when they gain FDA approval, the agency argues. Amgen said it “remains committed” to completing the Horizon acquisition.

This action dovetails with other ongoing work at the Commission in response to widespread complaints about rebates and fees paid by drug manufacturers to PBMs and other intermediaries to favor high-cost drugs at the expense of lower cost drugs. As the Commission explained in a policy statement issued in June 2022, these financial relationships create numerous conflicts of interest and can shift costs and misalign incentives in a way that stifles competition from lower-cost or higher-quality drugs, thereby harming patients, doctors, health plans, and competition. The FTC’s market inquiry examining the business practices of PBMs is also ongoing.

California-based Amgen is one of the world’s largest biopharmaceutical companies, with global sales of about $24.8 billion and a product portfolio of 27 approved drugs, including blockbuster drugs Enbrel (for rheumatoid arthritis), Otezla (psoriasis), and Prolia (osteoporosis). The FTC said that “Amgen has for years built its pharmaceutical portfolio through acquisitions, thereby increasing its leverage with the insurers and PBMs that negotiate reimbursement for its products.”

Horizon, based in Dublin, Ireland and Deerfield, Illinois, is a global biotechnology company with about $3.6 billion in sales that focuses on medicines treating rare, autoimmune, and severe inflammatory diseases. Horizon markets and distributes 11 drug products in the United States, including Tepezza and Krystexxa.

In securities filings, Horizon has boasted that its Tepezza “has no direct approved competition,” and that Krystexxa “faces limited direct competition.” Because of this, Horizon charges extremely high prices for those medications – approximately $350,000 for a six-month course of treatment of Tepezza and approximately $650,000 for an annual supply of Krystexxa.

The FTC claims that Amgen has a history of leveraging its broad portfolio of blockbuster drugs to gain advantages over potential rivals. In particular, the company has engaged in cross-market bundling, which involves conditioning rebates (or offering incremental rebates) on products such as Enbrel in exchange for giving Amgen drugs preferred placement on the insurers’ and PBMs’ lists of covered medications in different product markets.

The value of the rebates that Amgen can offer on its high-volume drugs as part of its cross-market bundles may make it difficult, if not impossible, for smaller rivals who are developing drugs to compete against Tepezza and Krystexxa to match the level of rebates that Amgen would be able to offer.

By substituting Amgen, with its portfolio of blockbuster drugs and significant contracting leverage, for Horizon, the FTC said the deal could give the merged firm the ability and incentive to entrench Tepezza’s and Krystexxa’s monopolies through its multi-product contracting strategies. This could effectively deprive patients, doctors, and health plans from the benefits of competition and access to critical new options for treatment of thyroid eye disease and chronic refractory gout.

The Commission vote to authorize staff to seek a temporary restraining order and preliminary injunction was 3-0.

Last year the FTC launched an inquiry into the prescription drug middleman industry, requiring the six largest pharmacy benefit managers to provide information and records regarding their business practices. The agency’s inquiry will scrutinize the impact of vertically integrated pharmacy benefit managers on the access and affordability of prescription drugs. As part of this inquiry, the FTC will send compulsory orders to CVS Caremark; Express Scripts, Inc.; OptumRx, Inc.; Humana Inc.; Prime Therapeutics LLC; and MedImpact Healthcare Systems, Inc.

Worker’s FEHA Action Rejected in Case Arising Out of Flu Vaccine Refusal

Cedars-Sinai Medical Center operates a nonprofit academic medical center in Los Angeles. Its total workforce exceeds 15,000 employees, including approximately 2,100 doctors and 2,800 nurses. Together, these employees provide medical care to thousands of patients per day and perform related administrative and operational functions.

Deanna Hodges began working for Cedars in 2000. Throughout her tenure, she worked in an administrative role with no patient care responsibilities. Her office was in an administration building Cedars owned about a mile from the main Cedars medical campus, though she occasionally visited the main medical campus in her capacity as an employee. A shuttle bus ran continuously between the main medical campus and the administration building, and many Cedars employees traveled between the two sites on a daily basis.

In 2007, Hodges was diagnosed with stage III colorectal cancer. She stopped working for a year and a half to undergo treatment, which included chemotherapy. The treatment was effective to rid her of cancer but left her with lingering side effects. These included unspecified allergies, a weakened immune system, and neuropathy – damage to the nerves resulting in an ongoing “tingling sensation” in her fingers and toes. None of these side effects limited her ability to perform her job functions, and she successfully returned to work for Cedars in 2009.

As an administrative employee without direct patient contact, plaintiff was under no obligation to get a flu vaccine when she was hired or when she returned from cancer treatment in 2009. This changed in 2017. That September, Cedars announced a new policy requiring all employees, regardless of their role, to be vaccinated by the beginning of flu season. This was the latest expansion to Cedars’s longstanding efforts to limit employee transmission of flu, which had become more urgent in recent years following multiple patient deaths relating to flu.

The expanded 2017 policy aligned with the recommendation of the United States Department of Health and Human Services Centers for Disease Control and Prevention (CDC) “that all U.S. health care workers get vaccinated annually against influenza.”

Her doctor wrote a note recommending an exemption for various reasons, including her history of cancer and general allergies. None of the reasons was a medically recognized contraindication to getting the flu vaccine.

Cedars denied the exemption request. Hodges still refused to get the vaccine. Cedars terminated her. Hodges sued Cedars for disability discrimination. Her complaint contained six causes of action, each alleged as a violation of FEHA or the public policy it manifests.

The trial court granted Cedars’s motion for summary judgment. The court of appeal affirmed in the published case of Hodges v. Cedars-Sinai Medical Center – B297864 (May 2023).

In her appellate briefing she identifies the elements of her prima facie discrimination claim as being those of a claim for physical disability discrimination. Citing Arteaga v. Brink’s, Inc. (2008) 163 Cal.App.4th 327, 344-345, a physical disability case which recites the elements of her prima facie claim as follows: “that she (1) suffered from a disability, or was regarded as suffering from a disability; (2) could perform the essential duties of the job with or without reasonable accommodations[;] and (3) was subjected to an adverse employment action because of the disability or perceived disability.”

Plaintiff argues her cancer history and neuropathy amount to a physical disability because they “make it impossible for her to work as she cannot work as she cannot get vaccinated. Her disabilities limited her ability to safely receive the vaccine.” To be clear, plaintiff admits her cancer history and neuropathy in no way otherwise limited her ability to work in 2017.

In moving for summary judgment, Cedars introduced evidence that plaintiff was not disabled and could not prove she was disabled. It offered official guidance from the CDC and testimony from Dr. Grein that there were only two medically recognized contraindications for getting the flu vaccine. None of the conditions listed on her exemption form were recognized contraindications for getting the flu vaccine.

The court of appeal concluded that “Judgment was proper on plaintiff’s disability discrimination cause of action because she failed to produce evidence sufficient to create a fact issue concerning an essential element of her prima facie case, i.e., her claimed disability or the perception by Cedars of disability. We therefore need not address the other elements of plaintiff’s prima facie case.”

Even if plaintiff had made a prima facie case for discrimination of any kind (e.g., physical disability, medical condition, or otherwise), summary adjudication of her disability discrimination cause of action would still have been proper because Cedars presented a legitimate, nondiscriminatory reason for her termination, and plaintiff fails to argue the reason was pretextual.