Curing Big Pharma’s Litigation Spend Woes with Data-Driven Medicine

Pharmaceutical R&D has contributed to important advances in treating a wide spectrum of diseases and disabilities, but as new drugs are introduced and patent exclusivity ends, the pharmaceutical industry has experienced an unprecedented wave of intellectual property and patent challenges. As the number and complexity of legal suits proliferate, pharmaceutical legal departments are increasingly challenged in containing discovery costs-even though many of these matters involve the same R&D documents related to the compounds.

Let’s look at why litigation budgets, and particularly discovery costs, are ballooning, since it’s not only about increasing data volumes and velocity of legal and regulatory compliance matters. Many pharmaceutical companies still manage their casework in silos, sending documents and data to multiple law firms and outside vendors, perhaps by area of expertise-when, in fact, a lot of litigation and regulatory or government inquiries involve the same core compounds, and thus many of the same documents. Under this model, the same documents are collected, processed, reviewed and produced for each new matter. When that case is complete, the data and work product is dispositioned. This approach creates massive inefficiencies and unnecessary costs, at a time when pharmaceutical legal departments are increasingly being called upon to rein in costs and operationalize discovery processes.

The good news is that the documents and data pharmaceutical companies produce related to the R&D and introduction of new drugs also can be a powerful resource for reigning in costs early on. With evolving technology and a centralized approach, legal departments can evolve their discovery approach beyond the traditional model. This would allow pharmaceutical companies to more effectively manage day-to-day discovery, gain greater oversight and control of litigation and their outside counsel spend, all while moving from a reactive, siloed approach to a knowledge-driven strategic business. 

Centralizing legal data

Centralizing legal documents is the key to a more efficient process. In a siloed approach, coding decisions on documents from either prior matters or regulatory investigations cannot be applied to future matters involving many of the same custodians and documents. Coding decisions and even attorney-client privilege documents may differ from one matter to the next, depending on the individual reviewer’s judgments. This increases the company’s risk of inadvertent exposure of sensitive information. When working in silos, you miss the opportunity to “review once and produce many times”. So R&D documents that come up frequently in patent litigation (or even suits related to trade secret theft or misappropriation, unannounced products or related claims involving the same core compounds) need to be recollected and reprocessed, re-reviewed and reproduced each time-again, generating inefficiencies, unneeded cost and risk.

Storing your company’s legal documents in a single repository enables your team to leverage prior decisions and documents, and aggregate key metrics across cases to support informed business decisions. Centralization also helps keep your data secure by allowing in-house teams to more effectively manage documents throughout the data lifecycle, controlling access and limiting the flow of sensitive information.

When using a multi-matter management system with a core repository, each new matter creates greater efficiency because data is collected and processed just once. When new matters arise, documents can be assigned from the core repository to a new matter without needing to collect or process the same data (additional costs), and prior coding can be pre-populated (greater efficiencies)-that is, coding decisions or “tags” such as privilege, confidentiality and other designations are retained for use across multiple cases. Documents can then be efficiently reproduced across matters, allowing for a “review once, produce many times” workflow for commonly-produced records such as R&D documents related to compounds in patent and related litigations. 

Say there are 10,000 R&D documents related to a core compound used in multiple drugs, and there are 50 lawsuits over time relating to each drug. Under a traditional model, assuming it costs one dollar to review one document, you would spend $500,000 just on the  review. This doesn’t include the additional costs of interviewing the same custodians again, collecting and processing the same documents and loading them to a review platform over and over again, or the immeasurable costs associated with risk of inadvertent production of sensitive material. In a centralized model, these same documents are reviewed and coded once--costing $10,000 and saving $490,000.

Using technology-assisted review

Advanced technology-assisted review (TAR) can further reduce costs by decreasing the volume of documents necessitating human review. The utilization of TAR 2.0, advanced predictive analytics based on the continuous active learning (CAL) protocol, allows a pharmaceutical company's legal teams to review far fewer documents than linear review (reducing collections by 80% or more) or earlier TAR systems, finding the most relevant ones first. When your team begins coding the documents, the TAR engine continuously surfaces the most likely relevant ones first based on the previous coding decisions. In other words, it is always continuously and actively learning. When the system mixes in contextually diverse documents, a process by which the algorithm is actively finding documents which may be related but are unlike other documents that have been reviewed, the review team will find documents they might not otherwise see.

With recent advancements in TAR, it is now effective for more than large outbound productions-it equally is effective for nearly any review task of any size-for investigations, opposing party reviews, deposition preparation and issue analysis, and privilege and privilege quality control. The result is that you can continue to increase savings on review and outside counsel fees for nearly every case.

Moving legal to a knowledge-driven business unit

Legal executives at pharmaceutical companies in particular, due to the nature of repetitive litigation, increasingly appreciate the opportunities afforded by capturing and re-using historical work product and documents where possible, and applying meaningful metrics to manage day-to-day discovery. The traditional silo approach makes that approach virtually impossible. By centralizing your data in a core repository, and adopting a comprehensive business intelligence strategy, discovery efforts will result in substantial cost savings and move your department to a knowledge-driven strategic business.

Daniel Gold is a senior enterprise director for Catalyst, where he advises corporations on technology-driven strategies. He can be reached at dgold@catalystsecure.com.