Trust the Leaders, Summer 2017

Leaders Trust the

SUMMER 2017

A PUBLICATION OF SMITH, GAMBRELL & RUSSELL, LLP

THE HEALTH ISSUE Health care and wellness in the 21st century

SGRLAW.COM

Trust the Summer 2017

3 Editor’s Letter 4 Legal Briefs

News and views from the offices of Smith, Gambrell & Russell.

10 Perspectives on Health Care

Laura Andrew shares her thoughts on health care in the United States today.

14 Medical Devices and the 510(k) A 510(k) may accelerate the process of bringing a new medical device to market, but manufacturers need to be wary when filing.

18 Digital Health

How the digital collection, monitoring and analysis of personal data presents serious concerns about security.

24 Client Profile: GuideWell Innovation We introduce you to GuideWell Innovation, an affiliate of Florida Blue health insurance company with a pioneering approach to delivering corporate wellness solutions.

26 Finish Line

A guide to the Firm’s expanding network of international offices and practices.

Smith,Gambrell

&Russell, llp Attorneys at Law

1230 Peachtree Street, N.E. Promenade, Suite 3100 Atlanta, GA 30309-3592 editor@sgrlaw.com editor-in-chief

Dana Richens editorial advisory board

Peter Goodman Joyce Klemmer Brett Lockwood Jim Monacell Jim Porter

sgr marketing team

Lee Watts Kathleen Rast Jaleesa Smith Elizabeth Thomas Mollie Werner

Trust the Leaders is published on behalf of Smith, Gambrell & Russell, LLP by Fourth Element Creative.

The information contained herein has been obtained from sources believed to be reliable.

The content and information in this publication do not constitute legal advice, do not in all cases reflect the opinions of SGR or its attorneys and are not in all cases complete or current as of the publication date. This publication is not intended to and does not create an attorneyclient relationship or provide legal advice or legal opinion. Legal advice should be obtained from one’s legal counsel.

Permission is granted to use and reproduce this publication in whole or in part for internal and personal reference, provided that proper attribution of authorship is given. Except for material in the public domain, this publication may not be further copied, modified, used or distributed, in whole or in part, in any form or by any means without the written permission of Smith, Gambrell & Russell, LLP. All other rights expressly reserved. © 2017 Smith, Gambrell & Russell, LLP. Leaders

used with permission of Leaders Magazine, Inc.

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TRUST THE LEADERS | Summer 2017 | SGRLAW.com

Editor’s Letter

Editor’s Letter

IN THIS ISSUE

Welcome to the Summer 2017 issue of Trust the Leaders, the magazine of Smith, Gambrell & Russell, LLP. This issue is devoted to our health care practice. Efforts to repeal and replace the Affordable Care Act, and questions as to what might take its place, have dominated the news since President Trump took office in January.

Health insurance in the United States faces an uncertain future.

What is not uncertain, however, is that other issues will continue to play an important role in how health care is delivered in this country. Data privacy – how can we continue to keep personal information private while expecting it to be readily available at providers’ fingertips? Innovation – what revolutionary advances can we expect to see in health care in the coming decades? Wellness – what is it, and what does it mean for businesses and consumers? And what are the legal implications of developments in each of these areas? You’ll find timely and useful information on all of these topics in this issue.

Laura Andrew p.10

Laura reflects on the past, present and future of the complex and, at times, controversial, world of health care.

Stephanie Scruggs p.14

Stephanie reveals the advantages and disadvantages faced by manufacturers when using a 510(k) filing to streamline and accelerate the process of bringing a new medical device to market.

Also, be sure to take a look at our “Where in the World is SGR?” infographic at pp. 26-27. Our new offices in Munich and London/Southampton, coupled with the addition of 10 attorneys with vibrant international practices, have expanded the SGR global footprint and will enable us to provide even more services to our valued clients around the world.

Have a great summer, and enjoy the issue!

Brett Lockwood p.18

Brett highlights the many concerns over privacy, security and confidentiality in the digital and cloud-based storage of personal health data and medical records.

Dana Richens Editor-In-Chief editor@sgrlaw.com

Kate Rowe p.24

Kate penned the profile of SGR client GuideWell Innovation – a pioneering firm in the field of corporate wellness.

FOLLOW

ONLINE

BLOGS: sgrlaw.com/blog TWITTER: twitter.com/sgrlaw LINKEDIN: linkedin.com/companies/27889

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LEGAL BRIEFS

THE LATEST NEWS AND UPDATES FROM THE SGR OFFICES

ATTORNEYS IN THE NEWS Laura Wartner, a partner in

Scott Cahalan, a partner in

Private Wealth Services with a

SGR’s Construction Practice,

concentration in trust and estate

is presenting webinars for

planning, has been appointed to

Lorman Education Services

the Board of the International Association

entitled “Beyond the Four Corners:

of Attorneys for Family Held Enterprises

Implied Obligations in Design and

(afhe). The organization is an independent,

Construction Contracts.” Scott was also

nonprofit association of corporate,

a guest lecturer at Georgia Tech’s School

litigation, tax and trust and estate attorneys

of Civil and Environmental Engineering

who provide multidisciplinary legal counsel

for a presentation entitled “Construction

and advice to publicly and privately held

Contracts and Legal Structure.”

enterprises, their owner-managers and family members.

Before law school, Mr. Cahalan was an engineer at Green Construction, Inc.

SGR partner Justice Leah Ward Sears is featured on the cover of the Georgia 2017 Super Lawyers magazine, recognizing the top attorneys in the state. The magazine includes an article chronicling the experiences of Justice Sears and six other African-American attorneys in Atlanta who overcame formidable obstacles to become leaders of the legal profession.

Joyce Klemmer, a partner

government to ensure Georgia’s legislation

Joe Mandarino continues his

in SGR’s Intellectual Property

is supportive of international arbitration.

robust schedule of seminars on

Practice, has joined the Board

AtlAS also educates judges, lawyers and law

tax issues through CPA Academy,

of Directors of the Atlanta

students on the substantive law, practice

International Arbitration Society (AtlAS),

and culture of international arbitration, and

seminars, and authored an article, “Recent

a nonprofit organization that seeks to

civic and business leaders on the benefits

Court Guidance on the Federal Treatment

enhance Atlanta’s stature and position as

of having a vibrant international arbitration

of Tax Credits,” for the Journal of Real Estate

a venue for the resolution of international

center in Atlanta. SGR is one of the

(December 2016).

disputes. AtlAS works with leaders in

founding members of AtlAS.

Strafford and private SGR client

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RECENT REPRESENTATIONS

New pedestrian bridge lights up the City of Macon The City of Macon, Georgia

first floor together with a deck for 400 cars.

leasing office. There is also an expansive

recently celebrated the opening

Following the creation of the condominium,

outdoor courtyard with outdoor seating, gas

of a 150-foot pedestrian bridge,

Sierra Development sold the office unit to

grills and fire pits. Another unique feature of

a first of its kind for Macon,

Mercer for use by the University.

the project is the 8,000-square-foot terrace

connecting the Mercer University

While typical commercial condominiums are

located on the roof overlooking Mercer University Drive and the stadium.

campus to the Lofts at Mercer

built on land owned by the developer,

Landing – a new, mixed-used

this condominium was built on land under

The pedestrian bridge, which lights up

project located just south of

a long-term ground lease from Mercer. As a

at night, is located over the right-of-way of

Mercer’s Five Star Stadium. SGR attorneys

result, at the end of the term of the ground

Mercer University Drive and is accessed via

John Bailey and Eugene Bryant handled

lease, Mercer will become the owner of the

stairs on the Mercer campus, and stairs and

the legal documentation for the developer,

entire student housing portion of the project

an elevator in the mixed-use project.

Sierra Development Group, which included

as well as the University offices on the first

the bridge agreements among Macon-Bibb

floor, the associated parking deck and other

Development and Macon-Bibb County, the

County, Mercer and Sierra Development, and

common facilities.

bridge is a success story for public-private

the creation of a leasehold condominium for a mixed-use project at the bridge’s south end.

The student housing includes 97 suites for

As a joint effort of Mercer, Sierra

partnerships. Developer Jim Daws calls the

313 students together with a 900-square-

bridge the “crowning jewel” of his projects

foot Sky Room that overlooks the stadium, a

on the Mercer campus, which have included

of 176,000 square feet of student housing

clubroom, fitness center, yoga room, movie

major business and loft developments

and 14,000 square feet of office space on the

and game rooms, and a 10,000-square-foot

throughout the College Hill Corridor.

The five-story, mixed-use project consists

TRUST THE LEADERS | Summer 2017 | SGRLAW.com

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LEGAL BRIEFS THE LATEST NEWS FROM THE SGR OFFICES

ATTORNEYS IN THE NEWS Kristen Lewis, Chairman of the

this event, recognizing award-winning

Board of Georgia Community

persons with disabilities. Pictured with

Support & Solutions, welcomed

Kristen (below left) and Mrs. Deal (center)

Georgia First Lady Sandra Deal

is Emma Barry, a new associate in SGR’s

to the annual GCSS “Golden Goals Awards”

Special Needs Planning Practice. Kristen

held at the Emory University Conference

continues to speak nationally on special

Center. Mrs. Deal was the keynote speaker for

needs planning and elder financial abuse.

LITIGATION SUCCESSES

Advertising adjudication SGR recently received two favorable decisions for its client Bayer HealthCare from the Advertising

Self- Regulatory Council

(ASRC). The ASRC is a forum

used by national advertisers from all industries who

choose to have advertising

disputes adjudicated outside a judicial forum pursuant to

ASRC procedures.

In the first case, Bayer, maker of

Coppertone® sunscreens, challenged Johnson & Johnson’s advertising for

its Neutrogena® sunscreen products.

The ASRC determined that J&J’s sensory

testing did not support its “superior feel” claim and that its sun protection testing did not support its product line claim.

J&J was required to discontinue the

unsubstantiated claims in TV and print

advertising. The matter was handled by Chris FitzPatrick and Carrie Anderer in New York.

In the second case, Bayer, maker of

RID® brand head lice treatment,

challenged comparative superiority and

other claims made by Prestige Brands, Inc. on its packaging and advertisements Jim Bikoff, a partner in SGR’s

SGR Managing Partner Steve Forte

Washington, D.C. Intellectual

has been selected to serve on

Property Practice, serves on the

the Best Lawyers Advisory Board.

2017 Intellectual Property Editorial

The Board is comprised of

®

Advisory Board for Law360, a legal news service

distinguished legal professionals from around

operated by Portfolio Media, a subsidiary of

the world. Almost 400 organizations are

LexisNexis. As part of his role, Jim provides

currently represented on the Board, including

feedback on the publication’s coverage and

the world’s leading law firms and Fortune 500

insight on topics for future coverage.

and Global 500 companies.

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TRUST THE LEADERS | Summer 2017 | SGRLAW.com

for its Nix® Ultra lice treatment product.

Prestige Brands was subsequently

directed to discontinue its claim that

its product can kill lice and lice eggs in the hair as well as unsupported

comparative claims against RID.

The matter was handled by Chris

FitzPatrick and Bryan Wolin from

SGR’s New York office.

RECENT REPRESENTATIONS

LITIGATION SUCCESSES Patent ruling

Stephanie Scruggs, Jessica Zurlo, Tom Wiseman and

Michael Schwartz secured a victory on behalf of

SGR client Yang when the U.S. Court of Appeals for

the Federal Circuit ruled in

its favor in an appeal brought by a competitor related to a patent interference

proceeding. Such a proceeding results in a final judgment

declaring one party entitled

to priority of invention, with

the losing party deemed not

entitled to the patent claims at issue.

The technology at issue relates to

a compound extracted from the husk

and fruit stem of Xanthoceras sorbifolia, its extracting method, and its uses to

Tax and relocation incentives

Perry McGuire, Florian Stamm,

and Ben Brooks assisted a Japanese

treat cancer and brain disease, among

Real estate transformation

other diseases.

SGR partners Sean Altschul and

Prisoner lawsuit dismissal

Victor Metsch recently assisted a

Working on a pro bono basis,

client seeking to expand its U.S.

commercial real estate client in the

headquarters achieve $1.2 million

transformation of a fully sublet,

in tax and other incentives. “Many

600,000-square-foot, triple net-

companies with existing offices do

leased building in Nassau County,

not realize that there are substantial

New York. The process included early

opportunities in the incentive market,

termination of the existing lease,

SGR recently obtained an

order and opinion from the U.S. Court of Appeals for

the trial court’s dismissal of an indigent prisoner’s

even if they want to stay where they

the relocation of subtenants into new space

are,” Perry notes. “There is a high

under long-term direct leases and a new 20-year

return in these cases for the client’s

lease for more than 300,000 square feet and

investment in legal support.” The

providing for major façade work at the building.

same team will assist the company in locating a

SGR also helped obtain benefits for the project

manufacturing plant in the Southeast.

from the local industrial development agency.

the Eleventh Circuit reversing

lawsuit and denial of his

motion to waive court costs.

Justice Leah Ward Sears,

Colin Delaney and Ben Reed

briefed issues relating to

the “imminent danger” exception to the

“frequent filer” prohibition on proceeding

Tom Wiseman, counsel in SGR’s

provides pro bono assistance to solo inventors

Washington, D.C. Intellectual

and small businesses by pairing them with

Property Practice, has been named

volunteer patent attorneys and patent agents to

“Attorney of the Year” by Georgia

help them prepare and file patent applications.

Lawyers for the Arts, which operates the

Tom received the honor for his extensive pro

Georgia PATENTS program. Georgia PATENTS

bono legal work through the program.

in forma pauperis.

The Eleventh Circuit instructed the

district court to grant leave for the

client to proceed without paying the

upfront court costs. Barber v. Krepp, 2017 WL 694489 (11th Cir. Feb. 22, 2017).

TRUST THE LEADERS | Summer 2017 | SGRLAW.com

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LEGAL BRIEFS THE LATEST NEWS FROM THE SGR OFFICES

RECENT REPRESENTATIONS Georges Vongerichten, FarmOn! offers consumers the opportunity to purchase a 10-week subscription to receive same-day harvested seasonal organic produce, fruit, greens, eggs, cheese and locally grown grass-fed meats and poultry options that are delivered to New York City direct from Hudson Valley family farms and the studentrun Ag-Academy at Empire Farm. Adding to its popularity, this successful program, now in its fifth year, includes tips and recipes from Chef Jean-Georges and his ABC team, as well as reservation access to his successful restaurants and FarmOn! events.

Inspiring youth for a future in sustainable farming

● FarmOn! Milk Money. This program provides financial and technical assistance

Steve O’Connell, Anne Pitter,

● The organization has partnered with

to schools interested in procuring local

Peter Goodman and Nicole

professional athletes of the National

milk for their lunchrooms. The program is

Chong of SGR’s New York office

Basketball Association for FarmOn! SLAM

instrumental in getting local milk to school

provide pro bono representation

DUNK YOUR VEGGIES, a program to get K-12

lunchrooms, “cow-to-kid,” in 36 hours. In a

to FarmOn! Foundation, a

students from underserved areas to plant

win-win, kids eat more healthily and the local

charitable organization located

“victory gardens” in their neighborhoods

dairy farms benefit economically.

at the Empire Farm in Copake,

and incorporate the produce into their school

New York, in the Hudson Valley.

lunches and classroom curriculum, providing

SGR has acted as outside general counsel

FarmOn! Foundation is dedicated

the students with a hands-on understanding

to FarmOn!, drafting corporate governance

to inspiring, educating and

of where their food comes from, and sending

documents, reviewing agreements and

preparing youth for the world

fresh organic produce home.

consulting on taxation and other issues.

“It gives me great pride to help such a

of sustainable farming as a longterm and profitable career.

● FarmOn! at Empire Farm hosts an Ag-

worthwhile organization as FarmOn!,”

FarmOn! Foundation is the

Academy for students in partnership with

notes Steve O’Connell. “Sustainable

brainchild of Tessa Edick, a food

State University of New York and Cornell

food production and the promotion of

entrepreneur and author who also

University, focusing on viable livelihoods in

healthy eating is vital to present and future

founded CulinaryPartnership.com and the

agriculture. Students live in residence, custom

generations.”

Friends of the Farmer Festival. The generosity

growing produce for their “clients” – some of

of Christy and John Mack and their family at

New York City’s best-known chefs and their

gratifying to work with a charity that is so

Empire Farm allowed Tessa’s FarmOn! idea

restaurants – while also learning cooking,

passionate about saving local farms, making

to become a reality. To further its mission

accounting and other business and life skills.

farms sustainable and connecting young

Adds Anne Pitter, “It is both inspiring and

people and adults to their food. I have a

of revitalizing local and family farming, the organization has created a number of

● ABCSA Farm Share. In partnership

whole new appreciation of what ‘farm to

innovative educational programs:

with ABC Kitchen and renowned chef Jean

table’ means and should be.”

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Contact: Laura Miller Andrew | Partner 904-598-6135 landrew@sgrlaw.com

At Smith, Gambrell & Russell, LLP, our health care attorneys keep pace with and anticipate changes. We provide both transactional and regulatory representation to health care industry clients, partnering with them to keep them both competitive and compliant.

Our Health Care Practice includes the following services:

Corporate Health Care Technology & Cybersecurity Life Sciences Biotechnology

Health Care Regulatory Health Care Benefits Food & Drug/FDA Pharmaceutical

TRUST THE LEADERS | Winter 2014 | SGRLAW.com

Atlanta | Austin | Jacksonville | London | Munich | New York | Southampton | Washington, D.C.

PERSPECTIVES ON HEALTH CARE

FROM LAURA ANDREW

“While the U.S. will spend one trillion dollars on health care this year, these resources do not always translate to better access to care, affordability and coordination”

L

aura Andrew is the head of SGR’s Health Care Practice. Her practice

or cost sharing for primary care; the French system exempts low-income

encompasses a wide array of health care-related matters, including

adults and those with chronic illnesses from cost sharing; and in

health care reform legislation, compliance with HIPAA, self-referral

Germany, out of-pocket spending is capped at one percent of income

(“Stark”), anti-kickback, and fraud and abuse state and federal regulations

for the chronically ill.

impacting health care organizations, and health care issues affecting medical device and life sciences organizations. TTL asked Laura for her

TTL: Does universal coverage make sense for the U.S.?

views on various issues relating to health care in the United States today.

LA: One criticism of universal coverage is the rationing of medical services, as seen in New Zealand, Australia, France, Canada, the United

TTL: Health insurance is an issue that has challenged the United

Kingdom and Taiwan. They ration health care services through methods

States for years. Do other countries have the same issues we do?

such as budgeting, controlled distribution, service restriction and price

LA: Health care coverage is a complicated topic. Few people agree on a

setting. Higher taxes, long waits for nonemergency health conditions,

single “best” type of system. The U.S. has a combination of a privatized

elective surgeries and a shortage of doctors are some of the other

system (insurance companies) and a public system (Medicare and Medicaid).

problems of these systems.

Other countries, such as Canada, Japan and most European countries,

Unfortunately, there is no “magic formula” for health care in the U.S.

have universal health care, which means that all citizens receive a basic

While the U.S. will spend one trillion dollars on health care this year – more

level of coverage, though the governments of those countries run the

than any other country – these significant resources do not always translate

programs in a variety of different ways. For example, the health care systems

to better access to care, affordability and coordination. Many believe the

in Canada, the Netherlands and the United Kingdom have no deductibles

current U.S. system is more likely to spark research and create new advances

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U.S. Health Care

TRUST THE LEADERS | Summer 2017 | SGRLAW.com

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U.S. Health Care

for the benefit of all. There’s a worry that research won’t progress as quickly if there aren’t the financial advantages inherent in the U.S. system.

TTL: How has your own practice changed the most in recent years?

LA: Prior to the passage of the Patient Protection and Affordable Care Act

We will continue to see the digitization of health care records, with more of each individual’s information held electronically.

of 2010 (ACA), employers, who often had their own self-insured group

Services, potential electronic security risks of HIPAA-protected information,

health plans, were free to design their plans to provide the health coverage

and the too-frequent breaches of HIPAA information. In addition to the

that was cost effective for that employer and its employees. Employers were

compliance issues discussed above, other of our health care clients, such as

not required to offer health coverage prior to the ACA. While employer

physicians, hospitals, nursing homes and emergency services providers, also

coverage was subject to the Internal Revenue Code and the Employee

have to comply with the often-byzantine rules and regulations of Medicaid

Retirement Income Security Act (ERISA), the employer was generally able to

and Medicare, and prepare for possible audits and inquiries from regulators

set the rules about eligibility and benefits. Once the ACA became effective,

regarding federal and state fraud and abuse laws, including the False Claims

employers had to redesign all of their group health plans and comply with

Act, the Anti-Kickback Statute, and the physician self-referral, or “Stark,”

the myriad requirements of the ACA, including the employer mandate to

law, as well as comparable state laws.

provide affordable health insurance. I now spend a lot of time working with employers on compliance with the ACA, and preparing for compliance with

TTL: We hear a lot about “wellness” these days. What is “wellness,”

the “next step” – the possible impact of the Trump administration’s promise

and what are the business and legal implications of this concept for

to “repeal and replace the ACA.” Those changes will be covered in our

our clients?

newsletters and health care blog – www.sgrlaw.com/category/health-care.

LA: “Wellness” is an umbrella term that refers to any program or process that encourages healthy behavior in order to prevent disease. Wellness takes

TTL: Which health care issues create the most problems for clients?

many forms, from simple health fairs and free personal tracking devices,

LA: In addition to the requirements of the Internal Revenue Code and

to complex wellness systems that provide rewards for participating in

ERISA, the ACA has added another layer of compliance burden, with

screenings, and, sometimes, in attaining certain goals. While studies on

mandates and reporting requirements. The Health Insurance Portability and

the long-term impact of wellness plans on the bottom line vary, most

Accountability Act (HIPAA) has also caused a lot of concern for our clients,

studies agree that wellness plans offered to employees improve morale.

including increased audits by the U.S. Department of Health and Human

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TRUST THE LEADERS | Summer 2017 | SGRLAW.com

Wellness plans are governed by the Internal Revenue Code, ERISA,

A brief history of health insurance in the US How we got to where we are now Late 1800s

Company clinics and infirmaries

Employer-based health insurance has roots in our industrial past. In the decades after the Civil War, those who worked in the most dangerous jobs – mining, steel, railroads, lumber – had access to company doctors, usually in clinics or infirmaries. As insurers grew more sophisticated, they began selling “accident” policies that included disability, death and burial benefits to employers.

Early 20th century

The first multi-employee policy

HIPAA and the Americans With Disabilities Act, and have to be designed to comply with these laws, including complex rules about access, communications, rewards and alternatives. We help our clients navigate these rules.

TTL: Many of the articles in this issue touch on “innovation” in health care. What do we have to look forward to in the next 20 years or so that will dramatically impact the way health care is delivered? What legal challenges will that create?

LA: Looking forward, we will continue to see the digitization of health care records, with more of each individual’s information being held and accessed electronically. We will also continue to see the advancement of solutions that are tailored specifically to an individual. For example, treatments based on a person’s individual DNA will become more commonplace.

However, the ability to predict what diseases a person may have based on his or her DNA will also increase privacy and ethical concerns for all parties. While the push to modernize and streamline the health care system will continue to occur, the system struggles to provide all with basic care as well as the complex treatment regimens that have been developed.

The debate over what is the best health care model for the U.S. will also continue. Whether the U.S. will continue with its current private/public health care system, convert to a single-payer system, or develop some new system, will keep us and our clients busy for the foreseeable future. ■ Laura Andrew is a partner in SGR’s Executive Compensation and Employee Benefits and Health Care practices. landrew@sgrlaw.com.

Modern group insurance began in 1910, when mail-order retailer Montgomery Ward implemented what is believed to be the nation’s first multi-employee health insurance policy through a plan issued by the London Guarantee and Accident Co. of New York. It paid benefits of up to $28.85 per week to ill or injured employees.

Pre-World War II

Health care as a worker benefit

Following passage of the Revenue Act of 1939, which established employee tax exclusion of injuries and sickness under health insurance, and the 1942 Stabilization Act, which stabilized wage increases during wartime, employers who needed to recruit workers began offering more generous health benefits to fill their workforces. These laws also created a major advantage for employer group health coverage: health insurance premiums deducted by employers no longer counted as income and, as a result, workers did not have to pay income or payroll taxes on those benefits.

In 1940, less than 10 percent (12 million people) of the U.S. population had any kind of health coverage. By 1950, about half of America was covered.

Post-World War II

Multi-faceted insurance policies

Insurers then began adding new types of coverage – “major medical” evolved in the 1950s, vision care in 1957 and dental benefits in 1959. Health insurance coverages continued to evolve in this haphazard manner, resulting in the system we currently have, where health coverage is provided by employers, individuals, the federal government (Medicare) and states (Medicaid).

TRUST THE LEADERS | Summer 2017 | SGRLAW.com

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Medical Devices

MEDICAL DEVICES

BY STEPHANIE SCRUGGS

AND 510(K)

A streamlined route to FDA approval or a trap for the unwary?

A

dvances by medical technology companies

of new devices while promoting the technological

provide more efficient patient care and allow

development of the devices. The classifications are

affected patients to live longer, more productive

assigned by the risk the medical device presents to

lives. Chronic medical conditions that may have resulted

the patient and the level of regulatory control the

in death decades ago are now treatable with devices

FDA determines is needed to market the device:

such as pacemakers and heart valves. Artificial knees and hearing aids improve quality of life for those

● Class I devices – low risk

affected. However, the interplay between the regulatory

Class I devices, such as arm slings, elastic bandages

framework intended to keep patients safe and the

and bedpans, generally pose low risk because of their

patent system intended to provide innovators with

noninvasive nature.

market exclusivity may present unforeseen risks to a

● Class II devices – moderate risk

manufacturer seeking to market a new medical device

Class II devices, such as x-ray systems, surgical drapes,

that is substantially equivalent to an existing device.

catheters, inflatable blood pressure cuffs and hearing aids, involve moderate safety and efficacy risks.

The FDA Regulatory Framework and Classes of Medical Devices

● Class III devices – higher risk

Medical devices are subject to review by the Food and

implants, are intended for use in supporting or

Drug Administration (FDA) before they can be marketed

sustaining human life or present a high risk of illness

and sold. The Federal Food, Drug, and Cosmetic Act

or injury.

Class III devices, such as heart valves and breast

(FDCA) defines a medical device such that the FDA regulates a broad range of devices, such as heart valves,

In other words, as the risk to the patient increases, so

tongue depressors and sutures, before and after the

do the classification levels and FDA pre-market scrutiny.

devices reach the marketplace.

For example, before a Class III device may be marketed,

The three-tier regulatory framework employed by the FDA for medical devices is intended to ensure the safety

it must undergo Pre-Market Approval (PMA) by the FDA and, typically, clinical trials to demonstrate its safety

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Could a 510(k) present obstacles to patenting a new device?

and efficacy. The PMA process is costly and time

In order to obtain patent protection on a new device, the patent claims must be new, useful and nonobvious. In other words, the Patent Examiner must find that the claims covering the new device are nonequivalent to the prior art. Yet, the claim of substantial equivalence in a 510(k) arguably admits the existence of prior art – the predicate device – that has at least some, if not all, of the elements of a patent claim related to the new device. As such, the 510(k) should be submitted to the Patent Office during prosecution of a patent application pursuant to the statutory duty of disclosure because it includes information on prior art that is relevant to patentability.

for substantial equivalence to legally marketed

consuming, particularly when added to the time and expense required for clinical trials. In comparison, since Class II devices are considered a moderate risk, the FDA reviews these devices products that have clearance for the same intended use, referred to as “predicate” devices.

The applicant must show substantial equivalence to a predicate device by way of a premarket notification, known as a “510(k),” at least 90 days before bringing the new device to market.

A 510(k) must also be submitted for certain Class I devices; however, most Class I devices are exempt from the premarket clearance requirements. The majority of medical devices enter the market via a 510(k).

The Examiner may not rely on the 510(k) itself to reject the claims on the new device because it is a comparison between two commercial embodiments, not a comparison of the prior art to the patent claims. But the documents submitted with the 510(k), e.g., package inserts or marketing materials on the predicate device, may be the very publications the Examiner uses to reject the claims on the new device. In this context, the 510(k) at least indirectly presents obstacles to patenting the new device if there are no distinguishable features to argue or add to the claims.

Understanding the 510(k) process

In addition, while U.S. patent law allows for a one-year grace period to file a patent application once an invention has been publicly disclosed, a 510(k) disclosing all of the elements of a patent claim starts the clock ticking on domestic patent rights. Moreover, most other countries apply an absolute novelty standard and will not issue a patent on an invention that has been publicly disclosed anywhere before the filing of a patent application. Thus, a patent application on the new device should be filed in advance of the 510(k) filing, or at least in advance of the publication of the 510(k).

is at least as safe and effective as the predicate

through FDA publication and/or a Freedom

devices. To make this showing, a 510(k) includes

of Information Act (FOIA) request. The FDA

information on the similarities and/or differences

lists the name, manufacturer and the 510(k)

between the new device and the predicate

summary of all approved devices on its website

devices, at least in terms of safety and efficacy.

within a month of approval. The statement of

Medical device companies need to be aware of how the information in a 510(k) may play into obtaining a patent on the new device.

Clear and effective communication between FDA counsel and patent counsel is essential to avoid compromising domestic and foreign patent rights through the filing of a 510(k).

the FDA to find substantial equivalence lacking

There are several considerations in the 510(k) submission process.

1

The identification of predicate devices The 510(k) submission for a new Class II

device requires identification of one or more predicate devices to which equivalence is claimed and a substantial equivalence statement. The substantial equivalence statement in a 510(k) is intended to show the FDA that the new device

After the 510(k) submission, the FDA has

predicate device is also accessible by competitors,

equivalence. Substantial equivalence is generally

including the manufacturer of the very predicate

found if the new device has the same intended

device to which the new device is claimed to be

use and the same technological characteristics

substantially similar.

of the predicate device. Indeed, different technological characteristics would likely lead

3

Potential overlap between 510(k) substantial equivalence and patent

unless these differences can be shown not to

infringement

raise new questions of safety and efficacy.

The manufacturer of a predicate device is

2

unlikely to allow a substantially equivalent new The public nature of a 510(k)

device to enter the market without exploring

Once an applicant submits a 510(k), the

available barriers to entry, one of which includes

documentation generally is publicly accessible

16

similarities between the new device and the

90 days to make an evaluation of substantial

TRUST THE LEADERS | Summer 2017 | SGRLAW.com

enforcement of a patent that covers the

Medical Devices

device and the predicate device.

In fact, a seemingly thorough 510(k) may very well outline how the new device performs substantially the same function in substantially the same way to obtain the same result as the predicate device. In such a situation, the substantial equivalence statement submitted in the 510(k) is almost identical to the language used to determine infringement under the Doctrine of Equivalents with one exception: the substantial equivalence in a 510(k) submission to the FDA compares the new device to the predicate device in terms of safety and efficacy whereas substantial equivalence in patent infringement compares the new device to the claims of a patent.

While the courts have indicated that a 510(k) cannot be used by an adversary as an admission of liability of patent infringement, the law is less settled with regard to the role of a 510(k) as supporting material to the claims at issue, such as when an allegation of infringement under the Doctrine of Equivalents is in play. An adversary may try to introduce the 510(k) during litigation to establish a presumption of equivalency between the new device and any patent claim covering the predicate device. This

Approval by way of a 510(k) may take a costly detour when the predicate device is covered by a patent.

possibility necessitates carefully chosen As a threshold matter, a third party may

during litigation to the detriment of the

using, selling or importing any device that has

alleged infringer. ■

each and every element required by a claim of a patent. There is a likelihood that the new device can be differentiated from at least one of the features of the patent claim to avoid literal

predicate device. As such, the streamlined path

infringement. However, if a device performs

to approval of a Class II device by way of a

substantially the same function in substantially

510(k) may take a costly detour when the

the same way to obtain the same result as the

predicate device is covered by at least one

patent claim, infringement may be found under

claim of an existing patent.

patent law’s Doctrine of Equivalents.

At a minimum, the statements made in a

wording in the 510(k) so it cannot be used

literally infringe a patent claim when making,

Why is this distinction important? Recall that

510(k) are available to the predicate device

FDA market approval for Class II devices via

manufacturer to use as a roadmap to allege

a 510(k) is more likely when the new device

infringement of a patent claim covering

has the same intended use and technological

the predicate device. The predicate device

characteristics of the predicate device. As such,

manufacturer may also try to use the 510(k) in a

it benefits a 510(k) applicant to detail the strong

more detrimental manner during litigation.

similarities between the features of the new

Stephanie Scruggs is the head of SGR’s Washington, D.C. Intellectual Property Practice.

She is an experienced IP attorney and represents clients across a wide range of industries in the enforcement and defense of IP rights and disputes. sscruggs@sgrlaw.com.

The Takeaway

Device manufacturers and their counsel should be keenly aware of the interplay between the FDA regulatory system and the patent system to maximize the benefit of a 510(k) while minimizing the risk associated with a patent infringement suit by the predicate device manufacturer.

TRUST THE LEADERS | Summer 2017 | SGRLAW.com

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DIGITAL HEALTH & PRIVACY Cybersecurity compliance amid the promise of telemedicine

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BY BRETT LOCKWOOD

Digital Health

D

igital health is the application of digital and computing technologies and the harnessing of an immense

array of related personal and other data to deliver enhanced and, in many cases, individualized, health care information and services. Innovations in digital health promise vastly improved health care as well as significant quality-of-life and financial benefits for consumers of health care services.

While advancements in health care delivery

of digital health in the U.S. was propelled

DEVICES, MOBILE APPLICATIONS… AND PRIVACY CONCERNS

significantly forward after the 2009 passage of

We now have countless mobile applications that allow the collection and

the Health Information Technology for Economic

monitoring of all types of personal data to optimize exercise and health-

and Clinical Health (HITECH) Act, which offered

related activities, administer and regulate medications, track our diets,

financial incentives for health care providers and

manage and treat chronic conditions, and notify us of abnormalities

technology companies to develop and implement

that occur within our bodies, to name only a few uses. Wearable and

interoperable electronic health records (EHR)

implantable devices work in combination with such applications to extend

systems.

these health care capabilities even further. The homebound can now

have paralleled those in technology throughout the modern era of medical science, the field

The EHR was conceived as a comprehensive

interact remotely with health care providers in virtual house calls by sharing

repository for an individual’s health information

images and other data and receive real-time diagnoses, treatments and

and health treatment history that would make

prescriptions. Artificial intelligence is being applied within “smart” prosthetic

it easier for patients to receive more effective

devices that enable amputees to engage in activities with performance that

treatments from providers equipped with greater

rivals or even exceeds that of natural limbs. The ability to collect and analyze

patient information. EHRs could also serve as a

individual genomic information opens up the possibility for personalized and

central database for related payment information,

predictive assessments and care regimens to help prevent diseases before

thereby improving health care payment flows.

symptoms appear. And the list of possibilities goes on.

To top it off, a personal health history might be

A common thread that connects almost all of these wonderful, life-

carried around by each individual on a smart card

enhancing innovations is that they are made possible by the collection,

or otherwise be universally accessible through

analysis and subsequent application of extensive health information and

linked networks by every care provider that an

other personal data and data sets. Because personal health information and

individual might need.

related financial information are among the most sensitive types of personal

The implementation of EHR systems still has a long way to go before meeting their potential.

Yet, much like the technology that spun off from

information, the manner in which such data are gathered, handled and stored requires careful attention.

Thus, the immense promise of digital health, resting on a foundation

the moonshot efforts of the 1960s, the incentives

of extensive personal data, also carries with it significant concern over

that spurred the initial and ongoing development

expectations of personal privacy and the security of personal data.

of EHR systems also served as a major catalyst for

Predictably and understandably, these concerns are the source of extensive

numerous other digital health innovations.

legal regulation.

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19

HIPAA AND HITECH PROTECTIONS In the United States, Title II of the Health Insurance Portability and Accountability Act (HIPAA) and Subtitle D of the HITECH Act and the accompanying Department of Health & Human Services (HHS) are the most significant sources of safeguards for protected health information (PHI). Collectively, these laws and regulations seek to protect PHI by imposing a comprehensive framework of privacy and security obligations concerning PHI on “covered entities,” i.e., health care providers, health plans and health care clearinghouses, and their “business associates,” i.e., vendors and others that supply and support health care providers and other covered entities.

Specifically, PHI means individually identifiable health information created or received by a covered entity that relates to (i) the physical or mental health or condition of an individual, (ii) the provision of health care services or (iii) the payment for health care, and that identifies an individual or from which there is a reasonable basis to believe that the information can be used to identify an individual. Thus, a great deal of the information collected from digital health activities is PHI if collected by a covered entity or a business associate.

The data privacy and security obligations of HIPAA and the HITECH Act are best understood by considering three broad sets of regulations issued by HHS commonly referred to as the Privacy Rule, the Security Rule and the Breach Notification Rule. These regulations are in turn subject to the related regulations comprising the Enforcement Rule,

Data breaches occur even with covered entities and business associates that fully comply with their obligations under the Privacy and Security rules.

which authorizes HHS’s Office of Civil Rights (OCR) to enforce these rules and impose substantial penalties for their violation. Each of these

The Security Rule

rules and their enforcement are addressed below.

Generally, covered entities and business associates must satisfy the following security objectives: ensure the confidentiality and integrity of

The Privacy Rule

electronic PHI handled by them, protect against reasonably anticipated

The Privacy Rule is intended to ensure PHI is treated with due respect

threats to the security or integrity of such PHI and reasonably anticipated

for each individual’s privacy, and underpins the HIPAA and HITECH

unauthorized uses and disclosures of such PHI, and train their staff on

regulatory scheme for the protection of PHI. In this sense, the other

related compliance matters.

rules are meant to reinforce the expectations of privacy and protections established by the Privacy Rule. Under HIPAA, use of PHI is restricted

technical safeguards and organizational processes must be implemented,

to only certain authorized uses connected with treatment, and then

and once implemented must be periodically evaluated to ensure that

only information that is the minimum reasonably necessary for the

these safeguards and processes continue to fulfill the overall objectives

permitted purpose, or those uses as to which an individual has given

noted above.

consent, such as for marketing. A notice of permissible privacy practices

20

To accomplish the foregoing, appropriate administrative, physical and

The Security Rule sets forth a wide array of mandatory as well as

must be provided before services are provided. Individuals are allowed

“addressable,” or optional, practices for covered entities and business

to access and review PHI records and request an accounting for most

associates to consider if warranted by the applicable circumstances.

nontreatment- and nonpayment-related disclosures of the individual’s

Of particular note is that while encryption of PHI is not required under

PHI made by a covered entity and its business associates.

the security regulations, if PHI is encrypted at an appropriate level of

TRUST THE LEADERS | Summer 2017 | SGRLAW.com

Digital Health

discovery of the breach, actual or constructive notice of key details is provided to affected individuals, to HHS and, in some cases, to relevant news media.

A breach is broadly defined as the acquisition, access, use or disclosure of PHI in a manner not permitted under the Privacy Rule and that compromises the security or privacy of the PHI. An unauthorized acquisition, access, use or disclosure of PHI is presumed to be a breach unless the covered entity or business associate is able to demonstrate, after conducting and documenting a thorough risk assessment, that a low probability exists that PHI has been compromised. However, breach notifications are required only if the PHI was “unsecured,” meaning it was not rendered unusable, unreadable or indecipherable to unauthorized persons through use of approved technologies, such as with specified levels of strong encryption, as noted earlier.

Enforcement by OCR As with so many other sectors of our society where personal data is involved, the occurrence of data breaches involving health care providers and their business partners has not gone without notice by the OCR strength, a breach that involves such data is not subject to required

division of HHS, which is the principal investigatory and enforcement

disclosure under the Breach Notification Rule. As a result, in addition

agency within HHS for health care data privacy and security concerns.

to being a best practice for data protection, the decision to encrypt

Most typically, an OCR investigation is triggered by a complaint being

electronic PHI is often driven by a covered health care entity being able

filed by an affected individual or a covered entity or a business associate

to avoid potentially embarrassing disclosures if a breach occurs.

filing a required data breach notification report. Requests by the OCR for follow-up information are routine and responses to such requests

The Breach Notification Rule

frequently reveal lapses by the reporting entity in one or more areas for

The unfortunate reality is that data breaches occur even with covered

which compliance is mandated.

entities and business associates that are diligent and fully comply with

Violations are subject to civil money penalties up to $50,000 per

their obligations under the Privacy and Security rules. When a breach

violation, with an annual cap of $1.5 million. The absence of willfulness,

occurs, the Breach Notification Rule is triggered and, absent

prompt corrective action or other mitigating circumstances are all taken

an applicable exception, requires that, no later than 60 days after

into account in how penalties are assessed. Criminal penalties and fines are also possible for intentional violations.

Historically, the OCR has been restrained in imposing civil money penalties. However, over the past few years as more attention has been given to privacy and security matters, the OCR has significantly stepped up its audit and enforcement activities for suspected noncompliance with the Privacy and Security rules. The result is that the number of actions brought for which civil money penalties have been imposed has more than doubled from prior years and the average size of penalties per case has increased markedly, to over $1 million. In addition, last year, the OCR also imposed its first-ever penalty on a business associate and, earlier this year, its first-ever penalty for a failure to provide timely data breach notices (see Selected OCR Enforcement Actions box, p.23).

TRUST THE LEADERS | Summer 2017 | SGRLAW.com

21

TELEMEDICINE The holy grail of digital health care

company Qualcomm to provide wearable fitness trackers to employees free of charge and to use the data collected to offer discounts on premiums.

But as with any new technology, legal compliance

Although there is no universally

is never as simple as it might seem.

agreed-upon definition of what constitutes telemedicine,

Licensure and Regulation

generally speaking it is the

Navigating the regulatory issues and licensing

use of telecommunications

requirements related to providing telemedicine –

when telemedicine is practiced across state

devices by physicians and

whether as a provider, a health plan or a

lines. In many cases, a physician in one state

health care providers to

technology company – can be challenging. In

who treats a patient by telemedicine in another

remotely diagnose and treat

Florida and Texas, a physician-patient relationship

state must have a medical license in both states.

patients. Telemedicine is also utilized by insurance

may be established by telemedicine. In Georgia,

Telemedicine also raises significant patient privacy

companies and employer-sponsored health

an in-person consultation is generally required

issues under the Health Insurance Portability

plans. UnitedHealthcare recently expanded a

before a physician may treat a patient by

and Accountability Act (HIPAA). While providers

pilot wellness program with telecommunications

telemedicine. Extra compliance challenges arise

are required to keep their patients’ health

BY QUINN BAKER

OTHER FEDERAL PRIVACY AND CYBERSECURITY OVERSIGHT AFFECTING DIGITAL HEALTH

recommend that mitigation of reasonably anticipated cybersecurity risks be taken into account in the design of medical devices and health-related mobile apps, these Guidances are advisory in nature.

Even for Class II and Class III devices, which require more scrutiny due to heightened sensitivity for safety and effectiveness, because the FDA

Although covered entities and their business associates have significant

is focused principally on a concern for physical harm to medical device

involvement with digital health initiatives, other entities in the digital

users, the agency only indirectly requires that cybersecurity controls be

health realm are neither traditional health care providers nor their

addressed in such devices as a recommended best practice and not as a

vendors or contractors. For these entities, the scope of regulated privacy

requirement, absent a genuine health safety risk.

and cybersecurity protections is notably less encompassing than that

The FTC fills part of the legal void for nonregulated entities and

addressed by HIPAA or the HITECH Act. Chief among these other

devices. It relies on its long-standing authority under the Federal Trade

entities are medical device manufacturers, developers of mobile software

Commission Act to address unfair and deceptive trade practices.

applications that have health-related uses, and providers of health

Consequently, the FTC has asserted itself aggressively in matters of data

records. For these entities, the Food and Drug Administration (FDA)

privacy and security on the basis of holding marketplace participants

and the Federal Trade Commission (FTC) are the two federal agencies

accountable for the privacy and security promises made to customers,

with regulatory authority for digital health privacy and cybersecurity

with the failure to honor such commitments being treated as a

matters, but the approach taken to such matters is considerably less

prosecutable deceptive trade practice.

comprehensive than the attention paid by HHS to these concerns.

The FDA regulates medical devices for safety and effectiveness

Connected devices and the “Internet of Things” have received special attention from the FTC. So, it’s likely that

concerns through its pre-market notification, review and approval

the FTC will insert itself more pointedly in cybersecurity

authority under the Food, Drug and Cosmetic Act. Because many

matters arising out of digital health efforts by non-health

medical devices and health-related mobile apps are deemed not to pose

care providers. The FTC has also specifically staked out

a significant risk of harm to user safety, they are categorized as Class I

monitoring the data privacy and security practices of

devices for which a pre-market review or approval is not required by the

businesses that are providers of health records that are

FDA, even though many of these devices collect and process personal

not otherwise covered entities under HIPAA.

data and thereby implicate privacy and security concerns.

However, although the FDA has issued a series of official Guidances on cybersecurity matters to manufacturers and developers, which

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TRUST THE LEADERS | Summer 2017 | SGRLAW.com

Brett Lockwood is a partner in SGR’s Corporate Practice and chairs the Technology Law Practice. blockwood@sgrlaw.com.

Digital Health

surprisingly, different payors have different rules.

how, to reimburse providers for telemedicine to

players into the mix. The company providing the

Under very limited circumstances, Medicare

the individual states. Likewise, whether private

telecommunications services will have access to

Part B (i.e., the portion of Medicare that covers

insurance reimburses telemedicine is also up to

patients’ health information, but under HIPAA, the

outpatient services like doctor visits) covers some

the individual states and insurance companies.

provider, or, in the case of telemedicine services

telemedicine services. Medicare will reimburse

As technologies continue to advance, state

offered through employer health plans, the health

office visits and consultations that are provided

and federal laws and guidelines on telemedicine

plan itself, has the legal responsibility to ensure

(1) to a patient living in certain rural areas (2) by

will likely continue to liberalize, creating

the information is kept secure. Providers and

a doctor or certain other health care provider (3)

a more favorable telemedicine landscape.

health plans should have strong privacy-protection

who is not at the patient’s location (4) using an

Providers, health plans or companies desiring

agreements with the telemedicine companies

interactive two-way telecommunications system.

to utilize telemedicine are wise to contact legal

providing the services.

However, the patient must be in a doctor’s

professionals to ensure they are complying with

office, hospital, rural health clinic, skilled nursing

the myriad requirements. The promise of innovation

Payment for Telemedicine

facility or other health facility. In contrast, some

in telemedicine is currently tangled in regulation.

Even if licensure and regulatory hurdles are

Medicare Advantage plans reimburse telemedicine

cleared, providers are not likely to practice

on more generous terms than Medicare Part B.

telemedicine if they cannot get paid for it. Not

Medicaid leaves the question of whether, and

information secure, telemedicine inserts additional

Quinn Baker is an associate in SGR’s Health Care Practice. qbaker@sgrlaw.com.

SELECTED HHS OFFICE OF CIVIL RIGHTS ENFORCEMENT ACTIONS

The FTC fills part of the legal void for nonregulated entities and devices.

Year

Entity

Nature of violation

Result

2017

Children’s Medical Center of Dallas

Theft of unencrypted laptop and Blackberry phone, each with several thousand patient records

$3,200,000 penalty and corrective action plan

2017

MAPFRE Life Insurance Company of Puerto Rico

Misplaced USB storage device stolen from IT department with over 2,000 patient records

$2,200,000 penalty and corrective action plan

2017

Memorial Healthcare System of South Florida

Unauthorized employee access and disclosure of records of over 100,000 patients

$5,500,000 penalty and corrective action plan

2017

Presence St. Joseph Medical Center (Illinois)

Operating room schedules on over 800 individuals misplaced and hospital delayed required notifications for longer than 60 days

$475,000 penalty (first-ever penalty for late breach notices) and corrective action plan

2016

Advocate Health Network (Illinois)

Several computers stolen resulting in exposure of over 4,000,000 patient records

$5,550,000 penalty and corrective action plan

2016

Catholic Health Employee’s stolen iPhone contained Services -- Archdiocese unencrypted PHI on over 400 of Philadelphia individuals

$650,000 penalty and corrective action plan

The Takeaway

Advances in digital health innovations hold great promise for amazing health care benefits for everyone. To realize those benefits, personal health data is subject to some level of risk in the hands of providers of digital health products and services. The legal protections in this area are already extensive but notable gaps exist, and as further innovations arise from digital health efforts, greater attention will need to be paid to existing and expanded privacy and cybersecurity compliance obligations.

TRUST THE LEADERS | Summer 2017 | SGRLAW.com

23

mission is to scout out innovation on the fringe and foster it. Unbound by the constraints on change that are typical of large institutions, she looks for entrepreneurs who are moving quickly to respond to critical issues in the marketplace, working on outside-the-box solutions and accelerating change in the health industry. GuideWell Innovation invests in these entrepreneurs and brings their knowledge to bear to improve institutional operations.

Entrepreneurs and innovators are making huge advances in artificial intelligence, for example. GuideWell Innovation is bringing those advances back to helping Florida Blue customer representatives parse among various benefit options and more efficiently help consumers choose the best health insurance. The company has also been researching and evaluating emerging trends, such as in precision medicine (the use of DNA to create targeted medical treatments) and bringing that information back to the GuideWell enterprise companies.

BY KATE ROWE

SGR CLIENT PROFILE

RENEE FINLEY AND GUIDEWELL INNOVATION: SYNCHRONIZED DEEP DIVING

R

GuideWell Innovation is also partnering with GE, Johnson & Johnson, Tavistock and Cisco to support The Intelligent Home, a project of the Lake Nona Institute. This is a prototype home in which new technologies, such as measuring human movement, can be tested and demonstrated, correlating them to specific human activities in a home and identifying variations that can warrant intervention or encouragement with respect to the individual’s health.

The Lake Nona Institute also is home to The Life Project, a 10- to 15-year study, led by Johnson

enee Finley is a spunky spark of a

Well-being and Human Performance; Next

& Johnson and supported by GuideWell Innovation,

leader. She has to be. As head of

Generation Consumer Engagement; Digital

assessing the impact of community health and

GuideWell Innovation, she fans the

Health & Remote Management; Computational

community programs on consumers and their

fires of innovation in an industry once slow

Health; Care Delivery; Healthcare Financing;

own active engagement on issues of allergies,

to change its ways.

and Health Policy.

sleep and depression.

GuideWell Innovation is part of the GuideWell Mutual Holding Company (GMHC) enterprise.

Shaking Up Health Care

Guidewell Innovation Center

Several years ago, Florida Blue reorganized

Renee brings her GuideWell Innovation team to

Virtual collaboration is one thing, but GuideWell

and, under GMHC, moved its diverse group

work with the GMHC enterprise of companies

Innovation believes that bringing innovators and

of companies and maintained in Florida Blue

to identify and improve upon issues anchored

institutions together in one physical location to

a focus on health care insurance. GuideWell

around institutional health care, involving provider

focus on ways of improving human health will bear

Innovation, a subsidiary of GMHC, focuses

practices, hospital systems and insurance coverage.

more fruit. Indeed, while GuideWell Innovation

on driving innovation in seven core areas:

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TRUST THE LEADERS | Summer 2017 | SGRLAW.com

But Renee also has a shake-it-up role. Part of her

is headquartered in Jacksonville, Florida, it built a

Client Profile: GuideWell Innovation

separate center further south in Florida, in Lake

address them – those with the right technological

care, with the aim of brainstorming and even

Nona, to encourage this collaboration and provide

and infrastructure resources to bring the solution

beginning to implement solutions. The 2016 event,

a space in which it could flourish.

to market. The resources may range from industrial

“Greater Than Cancer: The Other Side,” focused

engineering support and video production

on the challenges for cancer patients after their

the community was developed by Tavistock in a

capabilities to design methodologies, 3-D printers

initial diagnosis. This year’s forthcoming program,

thoughtful way centered on healthy lifestyles and

and physical plotters.

“Emerging Minds, Illuminating the Path to Mental

GuideWell Innovation picked Lake Nona because

healthy living and has an eco-system that was

Wellness,” focuses on behavioral health.

Last August, CoRE™ hosted the first of its

After such an immersion program, which

perfect for fostering innovation. The Life Project

annual immersion events – events that bring

and The Intelligent Home are just two examples.

selected thought leaders to “dive deep” together

typically lasts about three days, GuideWell

By coupling the various nearby elements of

on one critical, complex problem facing health

Innovation studies the results of the collaboration

research institutions, hospital systems that can

and creates a platform issuing a call for solutions

pilot new programs, commercial partners that can

and encouraging open innovation on a national

take a capability to market and the entrepreneurial

scale. It is an online tool with an application process

accelerator run by GuideWell Innovation, the

through which new and overlooked ideas can be

area provides an environment for extraordinary

submitted to help address a problem. The ideas

innovative synergy.

are evaluated by a committee and there is an award for the winner. GuideWell Innovation and

Lake Nona did not have a convening venue – a physical place where all of the various groups

its supporting partners, such as Johnson & Johnson

in the area and those from outside could meet

and the American Cancer Society, may advance

and collaborate. The GuideWell Innovation

one or more of those solutions and bring them

Center was built to provide this venue, and

to market.

The platform for the cancer challenge

GuideWell Innovation made sure to incorporate healthy living and architectural innovation in its

launched on February 15, 2017 (see reimagine.

design. The center even hosts three “living walls”

guidewellinnovation.com) and over 600

of plants. There are incubator spaces, co-work

participants engaged in the ideation process.

spaces, wet labs for bench science and spaces

Over 43 ideas were submitted on the topic of

throughout the facility that are specially

helping cancer patients navigate their treatment

designed for meaningful conversation replete

and recovery process. Mobile Chemotherapy

with supporting technology and collaboration

Check-up was the new idea award winner, which

resources.

will normalize the lives of 650,000 cancer patients who receive chemo each year.

There are lots of curved walls, open areas

Transformation is often resisted and

and hallways that come together to lead you on an innovation journey. As you walk through

collaboration is difficult. Innovation can be hard

the physical layout, you follow the process for

to recognize and its acceptance begrudging. For

nurturing new solutions – locations reflect where

GuideWell Innovation’s success, Renee and her

ideas are formed, fine-tuned and fostered, realized,

team must navigate the complex worlds of health

and then launched into commercialized solutions.

care, health insurance and human wellness, identify

Indeed, the entire plan of the facility is to accelerate

key problems, gather informed and committed

the collision of people, ideas and resources and

partners, nurture productive collaboration,

bring the ideas to fruition.

recognize solutions, synthesize results, and shepherd innovations towards fruition.

CoRETM immersion events

It is a vast challenge, and GuideWell Innovation has dived right in. ■

GuideWell Innovation is jumpstarting conversations on certain specific topics and pushing for solutions.

Through its Collaborative Resource Ecosystem, or “CoRE™,” Program, GuideWell Innovation tackles topics and brings specific players to the table to

Photos: upper left: Guidewell Innovation Center at Lake Nona, Florida; above (from top): Renee Finley; a “living wall” at the Center; Guidewell Innovation Theater.

Kate Rowe is a partner in SGR’s Intellectual Property Practice and is located in the Firm’s Jacksonville office. krowe@sgrlaw.com.

TRUST THE LEADERS | Summer 2017 | SGRLAW.com

25

WHERE IN THE WORLD IS SGR?

United Kingdom SGR opened UK offices this year in London and Southampton.

Our primary practices in these offices are Aviation and Air Transport. The UK has the second-largest national aerospace industry in the world and the largest in Europe. Mark Turnbull, Benjamin Graham-Evans and Gareth Hawes have added a wealth of experience in the aviation industry to the Firm, allowing us to better serve our clients and establish new relationships around the world.

A guide to the Firm’s services for international clients Smith, Gambrell & Russell’s International Practice provides our clients around the world with a myriad of legal services. As we strategically look at trends in business and legal services, we have chosen markets and regions in which to grow where we can provide the greatest value to our clients. Here is a glimpse of regions where we have most recently expanded, including the addition of the featured attorneys.

To read a full description of our International Practice and attorneys, and regions where we are growing, visit www.sgrlaw.com/international. Come and grow with us!

Atlanta Austin

NY

Washington, D.C. Jacksonville

Latin America SGR has a vibrant practice in Latin America. Several of our International Practice attorneys work with our clients there in banking and private finance matters, and mergers & acquisitions. The Firm recently expanded its practice in this region with the addition of Roger Juan Maldonado in our New York office. Roger is a litigator who uses his fluency in Spanish to represent the interests of various Hispanic and American businesses, government entities and individuals, and to represent companies investigating allegations of corporate wrongdoing and discriminatory employment practices.

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TRUST THE LEADERS | Summer 2017 | SGRLAW.com

Germany SGR opened an office in Munich this year.

The Firm welcomed Markus Bahmann to our International Practice. Munich is known as a hub for high tech, life sciences and IP. Munich also serves as the headquarters of many German companies. This office complements the Firm’s rich tradition of representing German and other European clients in inbound U.S. work.

Finish Line

Israel Italy The Italian Practice at SGR is led by Danila Duo in our New York office. This practice works closely with our industry-specific practices, assisting Italian companies with mergers & acquisitions, site selection, IP, employment, litigation, real estate, immigration and various corporate matters. Danila, a native Italian speaker, brings with her a wealth of knowledge of both the Italian culture and the types of legal issues that Italian companies face when they seek to enter, expand or maintain their presence in the U.S.

SGR provides legal services for many Israeli companies and organizations in both Israel and the U.S. The Firm is also an active sponsor of several initiatives in Israel, including DRIVE, a new innovation center in Tel Aviv.

As we grow this practice, the Firm recently added Yoram Keinan to our New York office.

Yoram’s practice centers on tax law in the U.S. and Israel, focusing on U.S. and international taxation of financial products and institutions.

Yoram represents multinational entities, banks, hedge funds, private equity funds and REITs.

Korea The Korean Practice at SGR is important to the growth of the Firm. Susie Kim, an immigration partner in our New York office, works closely with many of our Korean clients. Among other clients, we represent some of the largest Korean brand names in the automotive industry. Our legal services for our Korean clients include economic incentives, site selection, corporate, immigration, bond transactions/financing, construction, environmental, commercial contracting, labor & employment, federal (and international) tax, litigation, IP, and antitrust and trade regulation.

Japan SGR welcomed Kiyo Kojima to the Firm as a new partner. He is joined by an associate, Akiyo Hewett.

Kiyo heads our Japan Practice, which advises Japanese or Japan-related companies in the U.S. and elsewhere, and U.S. enterprises on various matters in Japan.

TRUST THE LEADERS | Summer 2017 | SGRLAW.com

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