Direct-to-Consumer Services

New Federal Trade Secret Act and Its Impact on Life Sciences

918333_u_s__capitol_buildingOn May 11, 2016, a new federal trade secrets law called the Defend Trade Secrets Act (DTSA) took effect. Its primary impact is to allow the victims of trade secret misappropriation to sue in federal court. It also provides some new civil remedies that exceed what is usually available under state law. The DTSA will be slotted into the U.S. Criminal Code (chapter 90 of Title 18), which already makes industrial espionage and trade secret theft a federal crime. In terms of what companies have to do to comply, the answer is almost nothing—the sole exception being a change in future employee contracts that is discussed below. In this post I’ll describe and analyze the new law and offer some thoughts about its potential impact on the life sciences industry.

Until now, civil trade secret protection has been entirely a matter of state law. The law is very consistent from state to state, as 47 states have enacted the Uniform Trade Secrets Act (UTSA). The exceptions are New York, Massachusetts, and North Carolina, though the North Carolina statute is generally similar to UTSA. Enforcement actions must usually be brought in state court, though federal courts can take jurisdiction if the plaintiff and defendant are citizens of different states. Even then, however, the federal court must apply state law in deciding the case.
Read the rest of this entry »

Comments Off on New Federal Trade Secret Act and Its Impact on Life Sciences
Filed under Direct-to-Consumer Services, Genetic Testing/Screening, Patent Litigation, Patents & IP

FDA Issues Guidance for Next Generation Sequencing

On July 8, 2016, the FDA issued draft guidance on the subject of next generation sequencing (NGS) activities: (1) “Uses of Standards in FDA Regulatory Oversight of Next Generation Sequencing (NGS)-Based In Vitro Diagnostics (IVDs) Used for Diagnosing Germline Diseases” and (2) “Use of Public Human Genetic Variant Databases to Support Clinical Validity for Next Generation Sequencing (NGS)-Based In Vitro Diagnostics.” The first focuses on the FDA’s proposed use of standards to help establish the safety and efficacy of NGS-based tests. The second focuses on the importance of high quality and publicly accessible databases to provide robust scientific evidence for understanding genomic variation, to inform decision-making, and to assess the clinical validity of NGS-based tests. Guidance is not a formal regulation, but rather an agency’s statement about how it will interpret or apply a regulation in the future. Draft guidance is a proposed policy that means the agency is formulating a position, whereas a final guidance is a document that represents what the agency has settled on as its interpretive policy. In theory, guidance is intended to serve as additional instructions for complying with rules and not intended to serve as the rules themselves.

The premise underlying the draft guidance is the controversial and—as yet—legally untested assertion that genomic analyses of all kinds are “medical devices” that Congress has, by statute, authorized the FDA to regulate. If they are, then the FDA would have the power to bring them under its current risk-based classification scheme for medical devices or to create a new scheme for them. If they are not medical devices, then the effort to regulate them might exceed the FDA’s statutory authority and conceivably amount to an unconstitutional regulatory overreach. Both draft guidance documents avoid any mention of the overarching debate, a subject covered extensively on Genomics Law Report, surrounding FDA oversight of all laboratory developed tests (LDTs) and in vitro diagnostic multivariate index assays (IVDMIAs). As others have noted, it is impossible to consider these new pieces of draft guidance outside of that context. Nonetheless, even the FDA asserts (via Twitter and elsewhere) that the two new drafts are intended to facilitate the Precision Medicine Initiative (PMI) and are distinct from the agency’s expressed intention to regulate LDTs. These pieces of draft guidance also give a policy-based reason for pause, as they could be another example of governance by guidance, a highly problematic approach as highlighted recently by John Conley with regard to the HIPAA right to access lab data and results.
Read the rest of this entry »

Comments Off on FDA Issues Guidance for Next Generation Sequencing
Filed under Badges, Direct-to-Consumer Services, FDA LDT Regulation, General Interest, Genetic Testing/Screening, Genomic Sequencing, Genomics & Medicine, Genomics & Society, Legal & Regulatory, Pending Regulation

Long-Awaited Announcement from the FDA on LDTs

FDA v LDTOn July 31, 2014, the FDA gave Congress notice that in the next 60 days it would be announcing draft guidelines on the regulation of laboratory developed tests (LDTs). This topic has been discussed on the Genomics Law Report frequently for years. [You can access the previous coverage here].

The “Anticipated Details of the Draft Guidance for Industry, Food and Drug Administration Staff, and Clinical Laboratories: Framework for Regulatory Oversight of Laboratory Developed Tests (LDTs)” mark a large expansion of FDA regulatory activity into industry practices that have been–depending on your perspective on the scope of the agency’s regulatory power—enjoying the FDA’s discretionary forbearance from regulation or taking place just outside of FDA’s regulatory reach. Indeed, aside from a few “it has come to our attention” letters in Summer 2010 and the second, more forceful warning letter issued to 23andMe in Fall 2013, the FDA has not taken action against companies providing individuals with direct-to-consumer (DTC) access to their personal genetic/genomic information.
Read the rest of this entry »

Comments Off on Long-Awaited Announcement from the FDA on LDTs
Filed under Direct-to-Consumer Services, FDA LDT Regulation, Genetic Testing/Screening, Genomics & Medicine, Genomics & Society, Industry News, Legal & Regulatory, Pending Regulation

What does the FDA Approval of the MiSeqDx Platform Mean for DTC?

FDA v DTCOn November 19, 2013—three days before the highly-publicized warning letter to 23andMe (See here and here)—the U.S. Food and Drug Administration announced that it had given approval for the marketing of four Illumina MiSeqDX medical devices. They include two cystic fibrosis genetic assays as well as the Illumina MiSeqDX instrument platform and Illumina Universal Kit reagents. The FDA’s press release characterizes them as “devices that can be used for high throughput gene sequencing, often referred to as ‘next generation sequencing’” (NGS). These instruments, reagents, and test systems allow labs to sequence a patient’s DNA (deoxyribonucleic acid).

What does the FDA’s approval of the MiSeqDx platform for the clinical market mean for the DTC industry? For example, does this mean that 23andMe could just switch platforms from the Illumina HumanOmniExpress-24 format chip to MiSeqDx and be free from future FDA meddling? Could new companies enter the industry free from regulatory burdens by using Illumina’s MiSeqDx platform? Don’t bet on it.

It is likely that the FDA would take the position that its 510(k) premarket approval (a process John explained briefly on December 3) of the MiSeqDx instrument and MiSeqDx Universal Kit was not intended to be a blanket “go ahead” for DTC providers to offer a service like 23andMe’s Personal Genome Service®. Rather, it is more likely that the FDA would insist on review and pre-market approval of MiSeqDx as an next-generation sequencing in vitro diagnostic (or NGSIVD) if it were used for any purpose other than return of raw genomic data (i.e., if any interpretation were provided along with that raw data). It is also unclear to what extent these FDA approvals will allow future applicants to rely on the approved MiSeqDX products as “predicate devices” to clear some of the regulatory hurdles more easily. (Specifically, the future applicant would claim that its device was “substantially equivalent” to the already-approved device.)

The FDA’s own press release nowhere mentions a non-patient consumer. The press release emphasizes how next-generation sequencing technologies are “becoming more accessible for use by physicians,” underscoring the FDA’s continued insistence that clinicians be the gatekeepers for accessing information about one’s genome. The press release states front and center: “The new technology also gives physicians the ability to take a broader look at their patients’ genetic makeup and can help in diagnosing disease or identifying the cause of symptoms.”

The FDA’s approval of the MiSeqDx platform is thus intriguing, but the future regulation of DTC genomic testing remains uncertain. The 510(k) approval of the MiSeqDx platform may signal that raw data provided DTC might be acceptable to the FDA but that interpretation of that genomic data in any way related to health would still provoke FDA scrutiny and, possibly, hostility. Could a DTC provider use the MiSeqDx platform and successfully argue that its interpretation of raw data is a Laboratory Developed Test (LDT; a test manufactured and used within a single CLIA-certified lab) and, therefore, potentially outside the reach of the FDA? We can’t say for sure at this point. As for the implications of this for 23andMe, as I reported on December 6, current indications suggest that the company is still trying to gain FDA approval of its Personal Genome Service.

Comments Off on What does the FDA Approval of the MiSeqDx Platform Mean for DTC?
Filed under Badges, Direct-to-Consumer Services, FDA LDT Regulation, Genomic Policymaking, Genomic Sequencing, Industry News, Legal & Regulatory

Update: 23andMe appeases FDA

FDA v LDTIn an effort to quiet the storm, 23andMe has announced that it does intend to continue seeking FDA approval and that, while that process is ongoing, it will no longer provide health-related information to new customers. Customers whose Personal Genome Service® kits were ordered prior to November 22, 2013 will still have access to that information; however, customers whose PGS was ordered after the FDA warning letter will only have access to ancestry information and their raw data. The company also announced that it would offer a refund to those who ordered the PGS on or after November 22, 2013.

So is this a victory for the FDA? Is this a loss for 23andMe? A setback for consumers? A win for anyone?
Read the rest of this entry »

Comments Off on Update: 23andMe appeases FDA
Filed under Badges, Direct-to-Consumer Services, FDA LDT Regulation, Genetic Testing/Screening, Genomics & Medicine, Genomics & Society, Pending Regulation, Uncategorized

The Revolt of the Cs: Class Action Filed Against 23and Me

The “Cs” in DTC have revolted, in the form of a consumer class action filed November 27, 2013, in a California federal court (Case 3:13-cv-02847-H-JMA). The suit, called Casey v. 23andMe, alleges that 23andMe falsely and misleadingly advertises its Personal Genome Service (PGS) test kit. The suit charges that these advertising practices violated numerous California statutes as well as other laws pertaining to misrepresention, breach of warranty, and unjust enrichment.

A class action is a suit brought by a limited number of “named plaintiffs” or “class representatives” (here just one, 23andMe customer, Linda Casey) on behalf of a large number of other, similarly situated people (the class members) who don’t actually participate in the litigation but would share in any recovery. The class here consists of all of 23andMe’s customers. The case seeks unspecified monetary damages, including at a minimum a refund of whatever the class members paid for the PGS, as well as an order (an injunction) prohibiting 23and Me from engaging in false advertising in the future. If there have been, as estimated, almost half a million PGS purchasers who paid the list price of $99, then the damages are potentially big. The complaint in this case also asks that 23andMe be ordered to pay the fees of the class lawyers. Attorneys’ fees can be huge in class actions, sometimes—and very controversially—running into the millions of dollars.

The complaint makes extensive reference to the November 22, 2013, FDA warning letter as evidence of 23andMe’s false advertising, so it is reasonable to ask whether that letter prompted this suit. That is, did the lawyers see an opportunity to free-ride on the FDA’s work and the negative publicity attendant on the letter? Hard to say: On the one hand, the complaint is long, detailed, and carefully prepared, evidence that’s in been in preparation for a while. On the other, the timing coincidence and the symbiosis of the allegations are suggestive. Across the legal spectrum, class action filings have a tendency to follow bad news for the defendant.

What can we say about the likelihood of success, or at least a valuable settlement, for the plaintiff class and their lawyers? It’s too early to do much more than speculate. Nonetheless, there are a few factors to keep in mind. First, the proposed class has to be initially approved, or “certified,” by the court before the case can continue as a class action. That’s a long (often a year or much more) and complex process involving difficult legal standards. As classes go, this one seems pretty coherent, so at first glance it would seem to have decent prospects for certification. As far as an ultimate winner and loser, the FDA has significantly helped the plaintiff class by setting out in its warning letter several specific advertising claims that it says are unsubstantiated. The class would have to prove at trial that the FDA’s charges are true, but those charges give the class a considerable head start. It is certainly a case with significant potential.

Comments Off on The Revolt of the Cs: Class Action Filed Against 23and Me
Filed under Direct-to-Consumer Services, Genetic Testing/Screening, Genomic Policymaking, Genomics & Society, Uncategorized

Troubles keep coming for 23andMe

As if the FDA warning letter wasn’t enough, 23andMe, Inc. now has a lawsuit on its hands. The suit, known as Casey v. 23andMe, was initiated on November 27, 2013, in federal court for the Southern District of California (Case 3:13-cv-02847-H-JMA). The suit is being brought as a class action and on the general basis of breach of implied warranties, unjust enrichment, and misrepresentation.
Read the rest of this entry »

Comments Off on Troubles keep coming for 23andMe
Filed under Direct-to-Consumer Services, Genetic Testing/Screening, Genomic Policymaking, Genomics & Medicine, Genomics & Society, Pending Litigation, Uncategorized

Designing Children

With this post the GLR introduces a new Contributing Writer, Jonathan Webber. Jonathan is a web editor at Robinson, Bradshaw & Hinson, the law firm that sponsors the GLR. His duties include copy-editing the GLR. That exposure, together with his background in anthropology—he came to RBH with a degree in anthropology and experience as both a field archaeologist and cultural educator for a state park system—has sparked his interest in some of the cultural and ethical issues that genomics raises. In this first post he brings his perspective to bear on the implications of 23andMe’s “designer babies” patent, and we look forward to more of his insight in the future.

By the way, some readers may detect a growing anthropological conspiracy: I’m an anthropologist, as is Contributing Editor Jen Wagner, and now Jonathan. Yes, we’re taking over.
Enjoy—
John Conley
GLR Editor

Copy of 02_03828_va_mao_posters_02_225

The September 24, 2013 grant of a patent to 23andMe for “gamete donor selection based on genetic calculations” has stirred another round of controversy about “designer babies.” Predictably, the press and blogosphere lit up with condemnations of both 23andMe and the United States Patent and Trademark Office. Karen Kaplan of the Los Angeles Times writes that the patent itself is “even more repulsive than the idea of using DNA tests to help people create designer babies.” Dov Fox of the University of San Diego School of Law suggests that “Congress should consider amending the patent law to appoint ‘ethics representatives’ to the PTO.” Sigrid Sterckx, et al., writing in Genetics in Medicine, note that the PTO did not “question whether techniques for facilitating the ‘design’ of future human babies were appropriate subject matter for a patent.”

So, while some ire has been and will be directed at 23andMe itself, commentators are also raising larger questions about patent eligibility and the patent application process.
Read the rest of this entry »

Comments Off on Designing Children
Filed under Direct-to-Consumer Services, Genetic Testing/Screening, Genomics & Society, Patents & IP

The ACMG Gene Screening Recommendations

57 sauceIn March, the American College of Medical Genetics and Genomics (ACMG) released its much-anticipated Recommendations for Reporting of Incidental Findings in Clinical Exome and Genome Sequencing. The ACMG describes itself as “an organization composed of biochemical, clinical, cytogenetic, medical and molecular geneticists, genetic counselors and other health care professionals committed to the practice of medical genetics.” Its brief mission statement includes a commitment to “Define and promote excellence in the practice of medical genetics and genomics in the integration of translational research into practice.” It publishes the journal Genetics in Medicine, and has previously issued “standards and guidelines” for clinical genetics laboratories and cystic fibrosis carrier screening.

The core recommendation is straightforward: “The ACMG recommends that for any evaluation of clinical sequencing results, all of the genes and types of variants in the Table should be examined and the results reported to the ordering physician.” Reading this in light of the definitions section and the rest of the report, it seems to mean this: Whenever a lab is requested to do any “clinical sequencing” (more below on what this means), it should examine the 57 genes listed on the Table and report any significant mutations it finds. It is the responsibility of the clinician who ordered the initial sequencing “to provide comprehensive pre- and post-test counseling to the patient.” In what has become the most controversial aspect of the Recommendations, the ACMG recommends the test findings “be reported without seeking preferences from the patient and family and without limitation due to the patient’s age.” In other words, patients should be given the 57-gene screening whether they want it or not and told the results even if they say they don’t want them—in effect, if you consent to any clinical sequencing, you automatically consent to this further screening and to hearing the results. The same holds true for the parents of minor patients.
Read the rest of this entry »

Comments Off on The ACMG Gene Screening Recommendations
Filed under Direct-to-Consumer Services, Genetic Testing/Screening, Genomic Sequencing, Genomics & Medicine

Undeterred by the Supreme Court, Myriad Starts Suing

GLR-HandAs soon as the Supreme Court issued its decision in AMP v. Myriad Genetics, Myriad issued public statements saying that it had many surviving patents that would perpetuate its BRCA testing monopoly. We may now find out if that’s true.
Read the rest of this entry »

Comments Off on Undeterred by the Supreme Court, Myriad Starts Suing
Filed under Direct-to-Consumer Services, Genetic Testing/Screening, Genomics & Medicine, Genomics & Society, Myriad Gene Patent Litigation, Patent Litigation, Patents & IP