WORLD RECOGNITION of DISTINGUISHED GENERAL COUNSEL

GUEST OF HONOR: Thomas M. Moriarty Executive Vice President, Chief Health Strategy Offi cer & General Counsel, CVS Health WORLD RECOGNITION of DISTINGUISHED GENERAL COUNSEL

THE SPEAKERS

Thomas M. Moriarty Mary Langowski Joe Lockhart Vincent A. Cino Executive Vice President, Partner, DLA Piper Founding Partner & Chairman, Chief Health Strategy Managing Director, Jackson Lewis P.C. Officer & General Glover Park Group Counsel, CVS Health

Creighton Condon Matthew Hurd Enu Mainigi Senior Partner, Shearman Partner, Sullivan & Partner, Williams & & Sterling LLP Cromwell LLP Connolly LLP

(The biographies of the speakers are presented at the end of this transcript. Further information about the Directors Roundtable can be found at our website, www.directorsroundtable.com.)

TO THE READER General Counsel are more important than ever in history. Boards of Directors look increasingly to them to enhance financial and business strategy, compliance, and integrity of corporate operations. In recognition of our distinguished guest of honor’s personal accomplishments in his career and his leadership in the profession, we are honoring Thomas M. Moriarty, Chief Health Strategy Officer and General Counsel of CVS Health, with the leading global honor for General Counsel. CVS Health is the largest pharmacy health care provider in the United States, with integrated offerings across the entire spectrum of pharmacy care. His address will focus on the challenges and opportunities that can be found at the intersection of law and public policy, particularly in light of the Affordable Care Act. The panelists’ additional topics include managing enforcement and regulation with key agencies; the role of mergers and acquisitions in identifying new business solutions; and the role that public policy plays in shaping a company’s business and, ultimately, its legal strategy. The Directors Roundtable is a civic group that organizes the preeminent worldwide programming for directors and their advisors. Jack Friedman Directors Roundtable Chairman & Moderator

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Thomas Moriarty is Executive Vice President, served as General Counsel and Corporate Chief Health Strategy Officer and General Secretary, and also as President of Global Counsel for CVS Health. In this role since Pharmaceutical Strategies. He served on the October 2012, Moriarty leads the company’s company’s Executive Committee and was a legal and government affairs departments and critical advisor to the team that developed the Office of the Secretary. and executed Medco’s strategic merger with Express Scripts. A seasoned executive with many years of legal, regulatory and health policy expe- Previously, Moriarty worked at various posi- rience in the health care sector, Moriarty tions in the Office of the General Counsel most recently served as General Counsel at at Merck & Co., the global biopharmaceu- Thomas M. Moriarty the Celgene Corporation, a biopharmaceu- tical company. He began his career at the Executive Vice President, Chief tical company, where he was responsible for law firm of Mudge Rose Guthrie Alexander Health Strategy Officer and global legal strategy and served on the com- and Ferdon in New York. General Counsel pany’s Management Committee. Moriarty received his law degree from the Prior to that, Moriarty spent twelve years University of Virginia School of Law and his at Medco Health Solutions, where he undergraduate degree from Lafayette College.

CVS Health and consumers expanded choice, greater Longs Drug stores. CVS/pharmacy is rein- access and more personalized services to help venting pharmacy to help people on their them on their path to better health. path to better health by providing the most accessible and personalized expertise, both CVS Health Pharmacy Services, the phar- in its stores and online at CVS.com. macy benefit management (PBM), mail CVS Health (NYSE: CVS), headquartered order and specialty pharmacy division of MinuteClinic, the retail medical clinic divi- in Woonsocket, RI, is the largest pharmacy CVS Health, provides a full range of PBM sion of CVS Health, is the leading retail health care provider in the United States, with services, including mail order and spe- medical clinic provider in the United States. integrated offerings across the entire spectrum cialty pharmacy services, plan design and MinuteClinic launched the first retail medi- of pharmacy care. Through our unique suite administration, formulary management, cal clinics in the United States in 2000 and of assets, we are reinventing pharmacy to discounted drug purchase arrangements, now has more than 800 locations in 28 states offer innovative solutions that help people Medicare Part D services, retail pharmacy and the District of Columbia. By creating a on their path to better health. We are focused network management services, prescription health care delivery model that responds to on enhancing access to care, lowering overall management systems, clinical services and patient demand, MinuteClinic makes access health care costs for plan members and pay- disease management services. Our clients to high-quality medical treatment easier for ors, and improving health outcomes. are primarily employers, insurance compa- more Americans. Nationally, the company nies, unions, government employee groups, has provided care through 20 million patient We are uniquely positioned to deliver signifi- managed care organizations and other spon- visits, with a 95% customer satisfaction rat- cant benefits to health plan sponsors through sors of health benefit plans, and individuals ing. MinuteClinic is the only retail health effective cost management solutions and inno- throughout the United States. care provider to receive three consecutive vative programs that engage plan members accreditations from The Joint Commission, and promote healthier, cost-effective behav- CVS/pharmacy, the retail division of CVS the national evaluation and certifying agency iors. Our integrated pharmacy services model Health, is America’s leading retail pharmacy for nearly 15,000 health care organizations enhances our ability to offer plan members with more than 7,600 CVS/pharmacy and and programs in the United States.

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JACK FRIEDMAN: Good morning. I am Jack Friedman, Chairman of the Directors Roundtable. We are a civic group that has done 800 events in 23 years around the world for boards of directors and their advisors. We have never charged anyone to attend the programs.

Boards of Directors tell us that companies rarely get favorable reviews about anything that they do. We are a neutral forum to tell people that businesses are socially conscious and that their leaders are proud of how their companies operate, as well as giving you a chance to meet some of these lead- ers personally. Today’s program is of special interest, because the healthcare industry is going through important changes and developments. Healthcare is universally of interest to almost any company. Their program beyond this important breakfast wrote what I thought was the perfect memo employees are concerned about healthcare meeting and projects it out on a global for the senior partner. I researched it, cite coverage and healthcare services. It is a very basis, which makes it very special. checked it — everything was in perfect order. important issue at this time. I handed it in. The next day, I reviewed it Without further ado, I would like Tom to with the most senior partner of the firm. His We will start with our Guest of Honor, make his opening remarks. office overlooked the Brooklyn Bridge down then we will have the panelists speak to on Wall Street — it was a real power center. make opening remarks, followed by a THOMAS M. MORIARTY: Good morn- He said, “This is a very good memo — it’s roundtable discussion and questions from ing everyone, and thank you, Jack. I see a lot very well-written, but there’s something miss- the audience. of old friends in the room. Before I begin, I ing from it.” I am sitting there as a first-year want to thank Creighton Condon and every- I would like to introduce our Guest of associate thinking, “What did I do?” What one here at Shearman & Sterling for this he said — and I’ve never forgotten it — is, Honor, Thomas Moriarty, who is the venue and for all the support you have given “You tell me in this memo what the law says. Executive Vice President, Chief Health for this program. I really appreciate it. I also But what is very important is to always tell Strategy Officer and General Counsel of want to thank our panelists. We have a great clients what the law means.” That is some- CVS Caremark. We keep the introductions group here. What is important to me is we thing that I’ve never forgotten, and it’s really to a minimum, so we can discuss content have a great group of not only legal minds, become a cornerstone of how I’ve practiced. instead of the great achievements of the peo- but also non-legal minds. With Mary and ple who are up here. Joe, the whole purpose of my talk and, hope- fully, this program, is to emphasize that legal Many years later — as my family will note, Tom has incredible credentials in terms of decisions really are not made in isolation. with a lot less hair — the maxim still holds service with different companies, and I will Looking at the broader ecosystem in which true. I would argue today — as we go forward mention some of them. Chronologically, a company operates is a focus for me in the — it is even more important, given the com- after graduating from Lafayette College and role that I play every day. plex ecosystem in which heavily regulated University of Virginia School of Law he companies, like CVS Caremark, operate. worked in a law firm, Merck, Medco, and I would like to start my remarks by sharing Celgene serving as General Counsel and in a quick story as a first-year associate fresh out Put simply, legal work cannot be done in iso- the Executive Committee. of law school. Actually, one of my first-year lation. Each analysis must take into account classmates from that experience is in the the broader environment in which a com- We’ll be preparing a full-color transcript audience so he may appreciate this story. pany operates, the industry it is in, and the which will be made available to 150,000 I was given a research assignment and, as number of what I call “non-regulators” who leaders on a global basis. This takes the usual, in a very convoluted area of the law. I have a say in the products that you sell, the

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reputation that you enjoy, and ultimately, an environment where consumers are play- the standing you have in the community ing an increasingly active role in healthcare that you serve. decisions. This is a new trend and a new development. As consumer-directed health This necessitates to me — and to others as plans shift the balance of accountability and well, who serve in these roles — an increas- decision-making to consumers, you should ingly strategic role for the General Counsel, expect that consumers will increasingly seek one that encompasses not only the tradi- greater value for those healthcare dollars, tional legal and corporate legal work, but which in turn will push greater transparency also public policy, public affairs, govern- — not just on issues of cost, but also out- ment affairs and regulatory affairs. All of comes and quality. This is a very clear trend, these must come together as you sit in this and it’s one that we refer to as the “retail- chair to advise and counsel a company as ization of healthcare” — that all companies it goes forward. It requires an understand- involved in healthcare are focused on and ing of how they intersect and how they can developing products and services to address. impact the company’s overall strategy and the products that it brings to market. It is against this backdrop that I evaluate issues and provide advice and counsel every day. The Nowhere is this trend and this factor more core guiding principle that I use for all profes- apparent than in healthcare. The Affordable sionals that are part of the CVS Caremark Care Act, regardless of your politics on the legal team — whether it’s the in-house counsel Our MinuteClinics, which now number over issue, has accelerated a number of health- or the outside experts who we retain to help 800 locations, are the nation’s largest retail care trends that all companies, whether in us with complex issues — is that we are part of, clinic providers. They deliver convenient, healthcare or not, have had to address. As and a partner with, the business teams. We affordable primary care solutions to patients everyone grapples with the need to do more need to truly understand how the business for common conditions, replacing the use of with less, and to ensure value to healthcare operates and its goals to help develop strategy higher-cost sites, such as emergency rooms, dollars spent, this has prompted a surge and to avoid pitfalls. Some examples from my and extending the reach of primary care to of activity in the private sector. We see a CVS Caremark experiences will resonate with millions of Americans every day. slew of mergers and acquisitions — and each of you as you address the challenges that I’ve been through one myself as a result of your companies face today. Through our Caremark Pharmacy Services this — strategic alliances and innovative new Unit, we provide prescription drug benefit business models that have touched every Undoubtedly, many of you have visited coverage to more than 60 million people, aspect of healthcare, from hospitals, phy- one of our pharmacies or MinuteClinics at helping to ensure that they use their medica- sician practices, health insurers, pharmacy some point in your life. We are a little hard tions safely and effectively. Also as important, benefit managers, retail pharmacies and to miss, since we are a part of almost every we ensure that the government health plans drug wholesalers. Each is being reshaped community across the country. and employer-sponsored benefit programs and reformed to address the new paradigm have effective prescription drug benefits that in the healthcare environment that we serve When I joined CVS Caremark, I was struck keep patients compliant with their medi- in today. That evolution will continue. — and I continue to be struck — by the scale cations. Lack of adherence to medication of the company’s engagements. Over the last therapy costs the United States healthcare The post-Affordable Care Act environment 50 years, the company has built a $120+ system almost $300 billion every year. has underscored the need for private sector billion-a-year business enterprise that spans leadership to advance efforts to improve the almost 8,000 locations, and is the largest These solutions address traditional con- quality of patient care and outcomes, and integrated pharmacy company in the United ditions like diabetes, hypertension and reduce costs, because cost, ultimately, is a States. Over 5 million people come through cholesterol, but increasingly, as you’ve real focus as we look at healthcare dollars our pharmacies every day. Through our seen in the press and with many stories, and how they’re spent. retail, mail order and specialty pharmacies, we’re focused on specialty conditions like we dispense over 1 billion prescriptions multiple sclerosis, rheumatoid arthritis There is also a focus to develop new and more every year. As healthcare continues to evolve, and cancer, and meeting these needs with effective means of communication, coordina- so does CVS Caremark and the services that infusion therapies, injections and other spe- tion and integration among providers. It is we will provide to meet these demands. cialized delivery methods.

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While it would be easy to think of us as only The core guiding principle that I use for all professionals a domestic company, it’s important to keep in mind that we are one of the largest, if not the that are part of the CVS Caremark legal team — whether it’s largest, commercial purchaser of prescription the in‑house counsel or the outside experts who we retain to pharmaceuticals anywhere in the world. As a result of that, we have a global supply chain help us with complex issues — is that we are part of, and a that needs to be managed and addressed. partner with, the business teams. — Thomas M. Moriarty We have also extended our footprint into Brazil, making an acquisition a little while Nowhere has the ability been better repre- Jack, thank you again for this opportunity back of a regional chain there of about 40 sented than in our recent decision to stop and for honoring me today. I do look for- pharmacies, all as part of our business the sale of tobacco products in our phar- ward to hearing from our panel. They are extension strategy. macies. In many ways, that decision is the not a shy group. They are very good at tell- ultimate example of how important it is to ing me where I miss things and where I Each of these areas requires not only fully understand and appreciate the ecosys- need to focus. I know the thoughts they’ll an understanding of the regulatory tem in which companies like ours operate. offer will be compelling. environment in which these companies When we looked broadly at our nation’s operate, but also the broader global public health needs and our own purposes Thank you all very much. [Applause] marketplace. Additionally, each healthcare at CVS Caremark — helping people on marketplace in which we operate comes the path to better health — we recognized JACK FRIEDMAN: Thank you. I would with its own unique set of challenges. To the fundamental inconsistency of selling like to start with a couple of questions for say that healthcare is a heavily regulated our Guest of Honor. sector of our economy doesn’t do it justice, tobacco in a healthcare setting. Aligning our businesses more fully with the goals and the implications of these regulations First, healthcare is intensely personal for to our business, and how we evolve as of consumers and those entities that fund individuals. Could you talk about how that a company, cannot be understated. As a healthcare benefits, to us, is an important result, it is critical that we engage with the component for long-term success. Our work plays a role in how healthcare is delivered? government at multiple levels to help shape in this area isn’t done. Later this year, we’ll THOMAS M. MORIARTY: It’s a great a constantly evolving regulatory landscape. be launching a national smoking cessa- question. If you look over the years, health- As a large, publicly traded company, we must tion program that will be designed to help care has always been very personal. Each of simultaneously ensure that the interests of millions of Americans meet their goal of our shareholders are addressed, and that us in this room has different views in terms stopping smoking. their investment provides a competitive, of what they seek to achieve, what they want fair-market return. to attain from a healthcare provider, and In summary, it’s clear to me — and hope- perhaps most importantly, how you access fully to all of you, as you’ve listened here The next point I want to make is perhaps the healthcare system. There are many dif- the most important. CVS Caremark’s size and will listen this morning — that the role ferent ways today and going forward, to and unique combination of businesses that the General Counsel plays in corpo- access health care. Some like the face-to-face has positioned the company to lead and to rate America today has evolved significantly. interaction and want to sit across the table accelerate positive change as the healthcare The skills required for this position have from their physician, from their pharmacist, system continues to evolve. Our company changed dramatically over the years, and or from their nurse practitioner. For oth- is dedicated to meeting one of our nation’s have changed what once may have been ers, mobility, market shortage or geography greatest challenges — the delivery of afford- viewed and perceived as a largely tactical might be an issue, so the patient may wish able, quality healthcare. Importantly, both role into one that is deeply strategic and to access health care by telephone, video market trends and the passage of the presents a compelling career opportunity. or other telehealth options. What is very Affordable Care Act have given pharmacies interesting to see in the marketplace today is and pharmacists a much broader role in All of us in this room are fortunate — and how each of those points of access is evolv- that healthcare delivery system. When we I mean fortunate — to have the kinds of ing and solutions are being brought to bear. look, as a leadership team — while there responsibilities we face. They challenge the are many challenges — we also see so many mind and invigorate us each day with What we are seeing is an evolution from a opportunities to have a positive impact on the opportunities that they present. All of system where employers or the government our customers, our communities, our more us do understand what is at stake, and do made the decisions regarding what you than 200,000 employees, and the country. our best to meet those obligations. should access and how you should access,

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place at the start and not wait for the crisis. role in healthcare. Whether it’s the role If you’re reacting to a crisis, that’s not when that our pharmacists play or the role of our the best thinking, necessarily, can be done. nurse practitioners in MinuteClinics, CVS Caremark is now engaged in health care It has been a fundamental part, for me, over delivery, pharmacy care, infusion therapies the last several years, to ensure that we have and other services such as Pharmacy Advisor, resources aligned and all working in sync. The health risk assessments or formulary best example of this is our decision to stop management. Fundamentally, smoking the sale of tobacco products. We considered simply exacerbates all the conditions that the numerous constituencies that the decision we are being retained to treat. That core potentially touched, and we did the work in contradiction was something that we felt we advance to think through the issues and have had to address in a deliberate, direct, and the scenarios prepared. It was a very powerful meaningful way. decision, and by having the work done ahead of time, it became an even more powerful JACK FRIEDMAN: I assume a lot of people decision once it was announced. are commending you for it. Can you tell us the feedback you have received for that decision? to an environment where the individual is in JACK FRIEDMAN: I remember a specific greater control. The growth of the high-de- moment, when the questioning of tobacco THOMAS M. MORIARTY: The out- ductible health plan and consumer-directed became part of popular culture. I was watch- pouring, frankly, has been tremendous and health plan is putting a lot more power and ing the Today show on NBC, and Bryant overwhelming on a lot of levels. decision-making in each of our hands. That is Gumbel was one of the co-hosts and they both compelling and scary at the same time. were interviewing a very famous law pro- There has been an outpouring of support, Offering solutions at an individual and con- fessor, who was talking about legal liability not only on Capitol Hill, but elsewhere, sumer level will be increasingly an important and what should be done on public policy. from clients, customers and the public. We part of the healthcare delivery system. Gumbel said, “Why do we call these people have been honored by a number of state ‘tobacco activists’? (as if there was something legislatures with joint resolutions and com- JACK FRIEDMAN: Can you give us an wrong with them, or that they were trouble- mended by 32 State Attorneys General in a example where the approach of combining makers) Why don’t we call them ‘healthcare joint letter to recognize our decision. legal issues with broader context was successful? experts’ or something like that?” The female co-host turned to him, spontaneously, on JACK FRIEDMAN: Thank you very THOMAS M. MORIARTY: I will start television and looked shocked. She said, much. I will ask one more question before where we did not have it fully in place at the “Did you clear this with management?” He we move ahead with the panelists. start — because you often learn best from said, “No.” She said, “We’re going to be hear- your mistakes — and then talk about a sit- ing from some sponsors.” At that moment, I When Hurricane Sandy hit the East Coast, uation where we did have it in place and it knew that the culture was in for some public I was in Boston, and I was waiting three made a huge difference. debate and was going to start changing. or four days until the planes could leave. I needed some medicine, and the hotel was I was part of a very large merger in the Could you tell us about how the decision checking around because the whole city was healthcare arena a few years ago. When the was made and financially, the pros and shut down. Where do you get medicine deal was announced, we knew there would cons, what’s at stake, and the commentary during a hurricane? How does the staff even be opposition and had a plan to address you’ve gotten back? get to the pharmacy, because you’re not sup- that opposition. We didn’t realize though posed to be driving. They checked around, how vociferous and well-organized the THOMAS M. MORIARTY: In terms and in downtown Boston, the only place opposition would be, and we were caught a of the financials, it’s roughly $2 billion a that was open was CVS Caremark. little off guard. Over the course of six weeks year in revenue for the company that we to two months, we put additional pieces in have chosen to forsake. In terms of the What is the role that the company plays in place to address the opposition’s tactics. philosophy behind how the decision was emergencies — fires, earthquakes, and other Ultimately, the merger went back fully on made, if you look at the footprint of the unusual situations — when people are des- track, but it was really a learning lesson for company — where it is today and where it’s perate to get their medicine? How are you me: you need to have all of the pieces in going — it’s increasingly playing a greater organized to handle these circumstances?

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THOMAS M. MORIARTY: We are part I cannot state this enough; we see it in our of the first responder systems as our phar- day-to-day practice with companies; we see macies are a critical aspect in emergency companies being very successful at it; we see response. We have several mobile pharmacy companies being not too successful at it. The units that we can deploy, and did, during difference is huge, and it is worth a tremen- Hurricane Sandy. Our area managers and dous amount of time, energy and resources if our pharmacists in charge at each of the you do not adequately plan for and take the pharmacies have the discretion to meet the policy environment into account. local needs. I will mention three main areas where this One quick story I’ll tell is about the ice is important. The first is risk management. storms that hit in Atlanta this past win- If you look at companies that are effectively ter. The city was literally shut down. You incorporating policy into their business couldn’t move, because the streets were strategy, they’re managing risk much more coated in ice. Several of our pharmacies effectively. There are sectors that are not essentially turned into overnight shelters doing this as effectively and are spending and were kept open for folks to stay. a lot of money they probably wouldn’t have to spend. If you look at the spectrum, and you watch policy trends and regulatory JACK FRIEDMAN: I can visualize the trends, very often you can predict litigation head of the pharmacy calling the local MARY LANGOWSKI: Thank you, Jack. trends that are coming. At times, you can policemen and saying, “I have to get to the I’m happy to be on this distinguished actually prevent litigation trends from pharmacy or people won’t get their medi- panel. Tom — congratulations; this is a happening. It can be a very good investment cine,” and the police immediately reacting well-deserved honor. I think it is worth to pay attention. and saying, “We’ll get you there!” reinforcing what an important decision CVS just made with its decision to remove One example is the food industry. The food THOMAS M. MORIARTY: Exactly. tobacco from its stores. I’ve spent many years industry is being beat up for salt, sugar, in healthcare, and things start to get really fat, and genetically modified organisms. JACK FRIEDMAN: I will mention our exciting when the private sector takes a large In some ways, the debate is driven by a different speakers and then they will each leadership role to improve public health and very vocal minority that is effectively using introduce their topics. population health. That’s the kind of thing social media, communications, lobbying that will actually change the nation’s health- and advocacy tactics. The food industry has We have Mary Langowski with DLA Piper; care. Congratulations to Tom and to CVS. been very effective over the years at speak- Enu Mainigi of Williams & Connolly; both ing to its consumer, but largely ignored its of them came up from Washington, D.C. I am Mary Langowski, and I chair the policy audience. The move to communicate, Creighton Condon, who is the senior part- Healthcare Group and the Food & Beverage not just to one stakeholder at the consumer ner here at Shearman. I do want to thank Sector at DLA Piper. DLA is one of the larg- level, but to a broader regulatory and pol- your staff very much; they are very effective est law firms in the world. We have a host icy audience, is extremely important, and and efficient and pleasant to work with. of traditional attorneys, but as Tom noted in to understand their connection to other his opening remarks, I serve as a “hybrid” — sectors. The food sector thinks like a food Matthew Hurd of Sullivan & Cromwell; policy, strategy and legal. We have a group sector would, but failed to use their connec- Vincent Cino, who is the Chairman of of “hybrid” types in D.C. who focus on tion to broader healthcare trends. As long Jackson Lewis; and Joe Lockhart, who is the policy, government affairs, advocacy, com- as we have major deficits in this country, Founding Partner and Managing Director munications, corporate development, giving healthcare is going to be a big deal, and of Glover Park Group, and also came from and business strategy. We basically take and anything that drives up healthcare costs is Washington. I remember Joe from when use all those tools in the toolbox to work going to be a big deal. Chronic disease is he worked at the White House and was on with C-suites to drive business strategy. My costing this country an enormous amount television. As a result, we can consider him remarks — and I’ll try to keep them brief — of money, much of which is preventable. to be a celebrity panelist. are going to build on what Tom was saying So food is front and center. That’s one about the importance of incorporating policy example of an industry that is trying to Let us start with Mary Langowski. into your overall business strategy. handle this situation, and spending many

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millions of dollars reactively on the pol- Over the last 50 years, the company has built a $120+ icy space, the regulatory space, lobbying, and now on litigation. billion-a-year business enterprise that spans almost 8,000 locations, and is the largest integrated pharmacy company in The second area is really reputation and relationship management. Joe is going to the United States. Over 5 million people come through our speak to reputation management more, but it is important — and I just mentioned pharmacies every day. — Thomas M. Moriarty this with the food sector — to think of a policy audience very differently than your Opportunities can come in the form of For example, there are a number of subpoenas clearing regulatory hurdles. If you’re trying consumer audience. You may be effective that have come out to several healthcare com- to enter global markets, they can come in as an organization in communicating with panies in the last two years or so, related to the form of changing reimbursement struc- the Anti-Kickback Statute. I have been doing your day-to-day consumers, while simulta- tures to open a market. A lot of people see Anti-Kickback Statute work since 1997. There neously worrying policymakers. A recent the policy environment as something to just was a lot of it in the 1990s and the early 2000s, example is 23andMe. This interesting little stay away from and ignore, but that is a mis- as it related to hospitals and physicians; and company sells direct-to-consumer genetic take. It is ripe with opportunity. then there was nothing. If you go back and testing kits. They have been very focused on look, you can absolutely tie together why you marketing and talking to consumers about We can talk in more detail, but I’ll pass the are getting Anti-Kickback subpoenas now, their kits and how you, as a consumer, can baton so we can do that. Thank you. across the board, at all healthcare companies. It figure out what you’re at risk for from a is because, in 2009, when Congress passed the genetic perspective. It’s a really interesting JACK FRIEDMAN: Thank you very FERA legislation, it included certain amend- and exciting organization. Meanwhile, the much. The whole area of public policy ments to the False Claims Act which resulted FDA and regulators were concerned and linked to reputation through social media in the intent requirement of the Anti-Kickback watched what was happening, and recently is something Joe and other people here will Statute essentially being removed for the pur- clamped down on the organization. They discuss. Those issues can come up even in pose of False Claims Act cases. sent letters without any real engagement M&A deals. It is a bit ubiquitous that in from the company. That’s an example every area you have to put attention on the The specific intent requirement — which of a regulatory action that can be mar- message that you’re sending and have an was critical, frankly, for the defense bar in ket-breaking instead of market-making. It is intelligent, proactive policy. Instead of wait- defending those cases when all the hospi- important to understand that you’ve got to ing for somebody to criticize you and then tals were sued and the physicians were sued develop a reputation and relationships early say, “We didn’t think about that!” We will — Congress just plucked right out of there and often, so that you’re not knocking just be taking that up later. and said, “For False Claims Act cases, the when you need something. government doesn’t need to demonstrate Enu Mainigi is our next speaker. specific intent.” As a result, you have a lot Third and finally, is the most important: of government agencies and investigators the opportunity and competitive edge that ENU MAINIGI: My name is Enu Mainigi. out there recognizing this and basically can result from incorporating policy into I am a partner at Williams & Connolly in seeing what may exist. You are all familiar your business strategy. You want to be in Washington, and my focus is healthcare with the pharmaceutical industry and the a position where you’re driving policy. You litigation. Primarily, I work on government fact that the off-label cases have wound their want to watch policy and forecast trends investigations, False Claims Act cases and way from one pharma company to another, that are going to affect your company so overseeing all of those types of cases. and everybody has come to the table and that you can pivot and adjust your business had a case and ultimately entered into what strategy accordingly. The area that I am going to focus on is usually is a pretty enormous settlement. obviously litigation and the concept that In the healthcare space, you see a lot of orga- it’s very important for us as litigators not to The same is now happening with the Kick- nizations which were prepared before the just think about the case when you get it, Back cases. It all goes back to the fact that Affordable Care Act even passed, which were and to consider, “What’s the case law that there was, at some point, an amendment changing their business models and looking relates to this and what can I do with this that was accepted, passed, but probably did at acquisitions very early on to take advantage particular case?” but to step back and ask not get much attention at the time from when the bill actually passed. Those organi- the broader question of, “Why am I getting those of us who will have to defend cases zations are doing very well right now. this subpoena?” when they come down the pike.

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flow through the system, one court may widened the pool greatly of the type of peo- answer this question this way, and another ple who can serve as whistleblowers. The court may answer the question another way. level of knowledge that they need to bring to the case is significantly less than had There was a court in Wisconsin last year been traditionally understood. that found that even though defendants had identified and corrected specific overpay- There was a case in 2012 out of the Fifth ment during an audit, because they made no Circuit, where the court found that even effort to go back and look for other errors, auditors who work for the United States that that was enough to say that they had Government could file a qui tam action acted with reckless disregard under the stat- against a private company. The interesting ute. Understandably, courts, without much thing was, in that case, the federal gov- direction from Congress on these issues, ernment actually filed a brief saying, “We are going to be all over the map. already support this.” Because of the word- ing of the statutes, and because no one Another example is public disclosure. A had really thought about this unintended great defense to False Claims Act cases consequence at the time the legislation was has always been: these allegations have drafted, the Fifth Circuit said, “Nothing we been out there for a while; cases have been can do about it. These people are clearly I’ve known Tom for 10 or 11 years, and filed about this already. This is not new persons under the False Claims Act; so one of the things that he has always been news; this is not something that needed they therefore have standing to file a whis- excellent at doing — and others are coming to be filed under seal by a whistleblower; tleblower action.” to the table and doing it, finally, now — is but this is something that everybody has focusing on the broader picture. How will known about. Congress has tightened that What are the implications? Obviously, the what we say to DOJ affect how HHS or now, as a result of the Affordable Care Act, top implication of some of this recent leg- CMS is going to look at us? If we go out and has basically given the government islation is a significant increase in False and say this, what will our competitors say? power to stop dismissal of those lawsuits Claims Act cases in recent years. In 2009, He learned well from his first year law stu- if they want. They said, “It only counts if there were 433 cases; in 2013, there were dent experience to step back and ask those we look at these issues at the federal level.” 752 cases filed. The government has bigger picture questions. It is critical for all Anything that gets filed in state proceedings found that their return on investment only of us who are litigators to ask that. — even a case that is virtually the same as increases; for every dollar that they put in, a whistleblower case that was filed at the they get $20 back, usually in the form of a A couple of other examples — and there federal level — doesn’t count. settlement. There’s really no downside in is a PowerPoint that is available for you to pursuing these cases. pick up — in addition to the Anti-Kickback The net result of that action, now, is that Statute, is the Affordable Care Act basically you have an increase, not just in the num- The government has a fairly significant back- codified overpayments as merely a per se ber of False Claims Act cases coming log of cases, over a thousand at this point, violation of the False Claims Act. That’s through, but you have an increase in the and is still continuing to intervene in a large going to be critical for healthcare compa- type‌ of whistleblowers that exist. Your typ- number of cases, about 20 to 25%. One of nies moving forward, because there are a ical whistleblower in 2004, for example, the things they are doing as a result of this lot of unanswered questions about how it was a former disgruntled employee of the backlog is saying, “We don’t have time to is going to be applied. What does “knowl- company. Whistleblowers today can be that, investigate this case right now before this edge” mean? What intent do you have to but they can also be the company’s auditor. judge makes us intervene or not intervene have? Who at the company is sufficiently They can be a contractor. They can be a in the case, so we’re going to file something high enough to know that there has been vendor. They can be a competitor who over- that says, ‘We’re not intervening now, but we an overpayment vs. not an overpayment? heard something from somebody. reserve the right to intervene later for good When you look at an overpayment, how cause.’” That leaves everybody in limbo for a far back do you have to go? These are all The net result of several of these amend- while, because the private litigant takes over questions created by this legislation that was ments that were affected as part of the the case, litigates the case, and gets well into passed; that don’t necessarily have answers Affordable Care Act, and then the FERA discovery. You always have the possibility that now, but they will. As whistleblower cases legislation the year before, is that you have the government may choose to jump in at

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any point. That completely changes the land- JACK FRIEDMAN: Thank you. Before scape, because the 20 to 25% of intervened we continue, I want to ask the panel as a cases have led to 97% of the recoveries. It whole, “What are examples of the federal, makes a big difference whether the govern- state and local agencies that you may deal ment is involved in the case or not. with in this area?”

Another trend emanating from the backlog THOMAS M. MORIARTY: One thing is the number of different U.S. Attorneys’ I want to follow up on is the role that the offices that are now looking at these cases. AGs can play in your business. The more Whistleblower suits had traditionally come they know about you, what you are engaged from the Boston office, from the Philly office; in, and what your business does, the better. they have now expanded to a significantly The more that your interaction with them larger number of jurisdictions. You have — is an informed dialogue, the better. That which is good and bad — a lot of prosecutors ongoing communication can, at a mini- out there, in a lot of jurisdictions, taking a mum, help balance the dialogue if you have fresh look at the False Claims Act Statute. to address an issue. They don’t have as much background in the healthcare world as some of their colleagues MARY LANGOWSKI: Healthcare is a great in other jurisdictions who have done more example of all of these levels of government healthcare cases. It can certainly lead to more coming together right now and creating complicated cases ultimately. much uncertainty and issues to watch for this law, from the state exchanges that are organizations. At the federal level, you not only being implemented, to Medicaid expansion. Another significant development and one of have the health reform law that passed, you The power vested in the states right now is the takeaways from this panel is the involve- also have a lot of follow-up activity in Congress. immense. That means, in many respects, ment of the state AGs. The state AGs have Some of it is simply noise, and some of it will fifty different ways of doing things, which is realized that False Claims Act cases and whis- result in small changes to the Affordable Care obviously very overwhelming for organiza- tleblower cases are critical. They are critical Act. Organizations should view the healthcare tions to handle. to fighting Medicaid fraud and helping the law as a living thing that is going to change budgets of various states. State AGs who are continuously. Multiple agencies have jurisdiction Of course, you also have local activity in smart about this have not only passed their over healthcare reform implementation. There the cities and localities on the public health own False Claims Act litigation, but they have is a tremendous amount of policymaking going side. It can be never-ending for organi- come to the table in litigation that the federal on at the regulatory level, because there was so zations. You also have to watch the court government has filed as well. They have now much authority given to federal agencies and system, because there are changes playing evolved from being tangential players in all of to the states. The various federal agencies with out on that side, too. this to being critical players. There are cases jurisdiction do not always agree on what the I am aware of where the federal government outcome should be. There is a lot of inter- JACK FRIEDMAN: I have another has said, “We are not going to go forward,” agency tension that is creating confusion for question on litigation involving cases with and the states have said, “We are going to go folks on the outside. individuals. It can be just one person or a forward with these cases.” They are critical class of individuals, versus a large company. stakeholders now, in addition to DOJ, in addi- One major example is some reimbursement One aspect of being a large company is that tion to CMS; they are yet another stakeholder changes that are driving consolidation in you get sued because you have deep pockets. at the table. One of the things that Tom recog- the healthcare space. They have encouraged What is the current attitude of jurors? nized early on is the critical role that the state more integrated care. Yet on the enforce- AGs and the state organizations can play in all ment side, there is fear that consolidation ENU MAINIGI: It is usually pro-the little of these things, whether it is the legislation or will give too much market power to a few. people. It is not usually pro-the company. It the litigation. It is significant for all companies There are some real contradictions in the is a tough world out there with juries. I just to be aware of that, and make sure that they law that could create enforcement issues. tried a case for six weeks in the Southern are building the relationships with those state District of New York before Judge Rakoff for organizations and AGs offices, so that if an More than ever before, states have a tre- a financial institution. It was as good a set issue arises, they can go in and explain their mendous amount of power. They are the of facts as you could ever hope to get, which side of the story. incubators of innovation in many ways with is, frankly — for the company — what led to

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us trying the case. Ultimately, the jury found THOMAS M. MORIARTY: The one against us. It was concern that it doesn’t thing I would add is the role of reputation matter whether this financial institution nec- in all of this — both corporate and individual essarily did something wrong in this case; reputation. The more your story is told and we know, somewhere, they have done some- you’re seen as adding to the system, the more thing wrong, because otherwise, we wouldn’t your reputation can help make a difference have the financial crisis that we have. in how some of these things play out.

JACK FRIEDMAN: The mime Marcel JACK FRIEDMAN: Let’s ask Joe about Marceau used to do a performance about this. Let us say you have a company that has litigation between an individual and a big all kinds of legal expertise advising them, company where he shows the corporate and they can fight tooth and nail to try to lawyer walking in with a fine suit and the win the case or to force a reasonable settle- plaintiff’s lawyer walking in helping the ment. If you are in the healthcare field, you mother and all her little children gathered have to worry about your reputation related around her. Many people do not care as to litigation. Joe, could you talk about the much about the law as about the fate of the issues you discuss when a General Counsel little people, especially when the company might have in the criminal context, where calls you in and says, “How far can we take has deep pockets. They may think, “It is you don’t necessarily want to share a lot of this conflict in the healthcare field?” What not going to hurt the company particularly. information with the government. I think are the trade-offs of fighting versus potential Let’s just make sure that these people are the healthcare industry has gotten much loss of corporate reputation? covered for their medical expenses without better, and needs to get much better, about punishing the company with punitives.” Is making sure that they are transparent and JOE LOCKHART: A lot of that depends that the stereotype image of what goes on? are disclosing as much about the business on how much work you’ve done before that operation as appropriate. conversation. In the healthcare field, if you’re ENU MAINIGI: That can certainly be talking about juries, and just combine some true; as a healthcare company, it is a high JACK FRIEDMAN: Vincent, your firm things that have been said, I guarantee that risk to take something to trial, because you has huge experience and expertise in a juror who sees that CVS no longer sells have the risk of exclusion, ultimately. That employment, sometimes with individual tobacco, will look at CVS in a more expansive, is why it does become critically important for workers against the corporations. How do positive way. They will look at it as a health- companies to step back, look and make sure the juries look at those cases? care, as a company committed to healthcare, that they put their voice out there when leg- as opposed to a company trying to maximize islation is being passed. Make sure that they VINCENT A. CINO: Enu was absolutely profits at all points. That’s why reputation is have good relationships with the state AGs right; a company is handicapped going into important. It’s probably the hardest thing to and with CMS — if CMS is their regulator. a trial. To further validate the point that you measure, or the hardest thing to put a precise Ultimately, make sure that they have — and Enu made, five or six years ago there value on, but it is important. even when they are under investigation — a was a survey of jurors in New Jersey. As strong path of communication with DOJ. you know, you try a case and it could go on I’ll give you a different example from another for five weeks or sometimes several months. field. Wal-Mart is one of the world’s largest One of the things emanating from the back- At the end of the case, the judge gives a retailers. They are also, perhaps, the most log I was referring to is that DOJ does not deadly boring jury charge to the jury, six sued company in the world. They have prob- necessarily want to intervene in every sin- people sitting in the jury box. The lawyers lems with employees, problems across the gle case, and they certainly recognize that have trouble understanding the jury charge, board. They decided, about ten years ago, there are a lot of cases out there that don’t never mind the lay people who are sitting that they could no longer just sell their brand have much merit. If you keep the lines of there and couldn’t get out of jury duty. The as “everyday low cost.” One of the particular communication open and have a good dia- judge says, “You have to apply the law to areas they went into was the environment. logue with them, it’s fairly easy to get in the facts of this case.” Seventy-five percent They had tremendous market power, with the there and explain your position. When they of the jurors surveyed said they dispensed purchasing they did, to go out and do it in a have knowledge, they’re apt to go investigate with that, ignored the law, and just decided more environmentally friendly way. That was in a direction that they may not necessar- the case based on what they believed to be a good for the world; it was also good for Wal- ily consider. It’s a different model than you fair and just resolution. That’s it! Mart. If anyone was watching Washington

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closely, a couple of weeks ago, when the antenna are out to see what the boss really President went to California, he went to a does, as opposed to just what he or she says. Wal-Mart to talk about environmental and renewable energy. That wouldn’t have hap- I would like to turn now to some of the pened without the ten years of work that’s board issues and business aspects of gone in, the reputation they built, and the healthcare companies. We want to thank reputation they repaired. There was a lot of Creighton Condon; I’ve known him for 20 Sturm und Drang among progressive groups years. It has been a great joy to watch him about “How could you go to Wal-Mart?” The rise to the global head of his firm. President’s people said, “We don’t agree with everything they did, but they’re doing a lot,” CREIGHTON CONDON: Thank you. and that’s an area where reputation had a First, I want to congratulate Tom for a very positive, tangible payoff. well-deserved recognition today. Jack has been promoting this forum now for a very JACK FRIEDMAN: I appreciate that, thank long time, and very successfully. He always you. I have another question regarding attor- manages to refresh it and come up with neys who could be whistleblowers within the new ideas, so that it is quite substantive. It corporation. A number of years ago, we did is a pleasure to participate in this program. a program with the former General Counsel out. It is not good when bad information of the SEC. I asked him, the panel, and the is shielded from the management team or JACK FRIEDMAN: Thank you. audience, “Is there a situation where a corpo- from the corporation. We do not wake up rate attorney can rightfully report wrongdoing every day to do wrong; we wake up every CREIGHTON CONDON: I’m Creighton to a government agency, regardless of the attor- day to do good. That’s really what the busi- Condon, and I am the senior partner of ney-client privilege?” One person said, “I’m ness is about for all of us here in the room. Shearman & Sterling. an IP lawyer. When you do a patent applica- There is no question that things can some- tion, the rule is that you have to have enough times go wrong — and must be addressed. You have been hearing some of the things expertise to sign off that this is a meritorious There are different mechanisms to handle that CVS has been doing, some terrific application, in terms of content of the patent. this such as ethics lines or compliance things on the business side, and mention- You are obliged to withdraw your signature if lines. The employee must have the ability ing your relationships with regulators. It is you do not think it is meritorious.” to provide information without retaliation. proxy season, so I would like to shift gears Ultimately, it comes down to company cul- a little bit and talk about another important, The former General Counsel for the SEC ture where the tone is set from the top. increasingly vocal constituency, which are said, “I will give another extreme example, but The leadership team must encourage a shareholders. In particular, there is share- this is said even under the old rules. If you are culture that addresses and resolves tough holder activism and the need to dynamically the in-house counsel for an airplane company, issues early. One of the top priorities for engage with the institutional shareholders. and you know that there is a high probability CVS Caremark and our in-house lawyers that a particular plane will crash, it does not is to get that message out. You cannot walk Over the past few years, the corporate gover- matter what the privilege rules are, you should the halls of any of our buildings without nance landscape has changed dramatically, report it. You are immediately saving a few seeing a poster that encourages employees — with the emergence of activist hedge funds. hundred lives.” That’s a rather high standard when they “See something, say something,” The most successful funds have become for a whistleblower or reporting. because we want folks to identify potential expert in identifying particular opportunities problems so that they can be corrected. that they think will resonate with institutional I want to ask when some General Counsel investors. They get in and cause a lot of issues would see that reporting up the line, going JACK FRIEDMAN: Jim Comey, who at the for companies that are trying to pursue what to the board directly, or external reporting time was the General Counsel of Lockheed they otherwise think is the right strategy for is ever warranted. Martin and is now the head of the FBI, made the company. They use the media very effec- this comment — he had small children, and he tively, and they use the proxy process, as well. THOMAS M. MORIARTY: From an said that they watch what parents actually do, in internal perspective, it’s critical that you terms of integrity — not just what they are told is There is a very heated debate in the commu- have the mechanisms in place that allow the proper thing to do. He said, “When you’re nity, among academics, economists and the people to raise their hand and point things a boss, your staff do the same thing. Their legal community, as to whether shareholder

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activism enhances shareholder value or not. control up to 20% of the stock in these com- The debate tends to center around short- panies, in terms of how they’re going to vote) term vs. long-term value, and what the — supported that. Ultimately, the proxy fight relative merits are and whether companies was settled when Hess agreed to put three of are being forced to be more short-term due Elliott’s nominees on the Board and split the to the presence of hedge funds either actively CEO and Chairman positions. in their stock, or due to the overall atmo- sphere. No matter how you come out on Finally, at Procter & Gamble, Ackman’s the present debate, it is clear that this kind Pershing Square took a $1.8 billion stake, of activism is here to stay, and people really representing less than 1% of the stock. need to understand it and deal with it. While they didn’t get on the board or on the face of it pursue a successful strat- There have been a couple of significant egy, the CEO stepped down within a year recent developments. Over the last eighteen of Ackman joining the fray. months, it has become increasingly clear that the size of a company is not a deter- The agendas can be varied. It can be rent to shareholder activism. Mainstream changing management, requests for board investors have really embraced activist hedge seats, and campaigns for specific strate- funds as a legitimate asset class, and they’ve gic, operational or capitalization changes. flooded them with capital. Every day, there It can also be to challenge compensation. are new activists in the market. The activist Compensation is often just a tool for push- funds are getting larger and are in a position ing for other agendas, but it’s certainly one friendly to management, and only willing to take significant stakes in large companies. that resonates with institutional investors. to get involved in situations if management was inviting them in, have become more Institutional investors have also been more Board representation is often a key objective, aggressive. One very significant player in open to supporting activists who come and just a month ago, Carl Icahn dropped the space right now is pursuing a hostile armed with a well-articulated plan. his campaign for a board seat at eBay. bid in Australia for a company. In another Through an agreement with eBay to add situation here in the U.S., in another hos- Campaigns at Apple, Hess, and Procter & an independent director, which in the pub- tile bid, a private equity firm is providing Gamble, support that view. At Apple, the lic statements was said to have been agreed over a billion dollars of the equity capital in controversy was around Apple’s consid- upon between eBay and Icahn, the person order to pursue the bid. erable cash resources and what should be added was none other than David Dorman, done with those. David Einhorn pushed who is the chairman of CVS Caremark. That gives you an overall feeling for the Apple to put in place a high dividend pre- change in the environment that we’re seeing, ferred stock, which led to litigation. Carl The other phenomenon is that activist and how even institutional shareholders and Icahn entered the fray, introducing a prec- shareholders — and this is slightly afield private equity firms, who traditionally have atory resolution that Apple do a buyback but gives you a sense of the environment been less active, are becoming more active. of not less than $50 billion. Einhorn and generally — are becoming much more active Icahn both ultimately backed off, but Apple on the M&A side. The Allergan/Valeant It is important to be prepared. There are a clearly responded affirmatively in terms of situation, where Valeant has put a bid on number of things which boards typically do. positive statements about their intent to the table for Allergan, is maybe the most In my experience, boards and management return capital to shareholders. notable of those. Again, Pershing Square, are actually quite proactive in pursuing the Ackman’s firm, has financed a large portion right thing in terms of developing strategies At Hess, Elliott Management was pursuing an of the cash that’s being used in that transac- carefully, being able to articulate those strate- agenda of splitting the U.S. shale oil business tion. It’s a $49 billion transaction. That has gies and what the long-term benefits are, and from the international exploration business. made a material difference in the ability of employing strong decision-making processes. When Hess refused to comply, Elliott nom- Valeant to go after Allergan. Boards are engaging today in exercises of look- inated five directors and Relational Investors ing at the company from the perspective of came into the stock in support of that. ISS One more environmental issue I would what the activists might pursue, and going and Glass, Lewis proxy advisory services who just note is even private equity firms, through an exercise — often on a yearly basis, are significant players in this space (they often which have historically been viewed as only with their advisors — of looking at all aspects

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of the company’s operations, and their strat- What we are seeing is an evolution from a system where egy, the board composition, succession issues, compensation, etc., from the perspective of employers or the government made the decisions regarding that shareholder view, and then pursuing what you should access and how you should access to an changes that they think are appropriate. In any event, they are being better educated and environment where the individual is in greater control. prepared to defend their strategy on those things if they are approached. — Thomas M. Moriarty

Also, Boards are really giving a hard look That was not the U.S. model 15 or 20 years couple of weeks ago, and John Kerry came at their shareholder base, and they’re engag- ago, where with the poison pills and stag- and spoke. He gave a very engaging speech ing — and I’ll be spending a little more time gered boards and all the other defenses, to the graduating class. About three-quarters about that in a second — much more actively companies could often effectively insulate of the way through, he started to talk about with their shareholder base, and analyzing, themselves from shareholder action. global warming. You could see the audience understanding, and tracking the shareholder — whether it was people who were 100% base. You will also find they are continuing With the dismantling of staggered boards, in agreement or people who were 100% to look at defensive measures and being pre- with the circumscription of the ability to opposed — the whole audience sat back and pared to respond if they are approached. use pills quite as effectively as historically, said, “Here we go — global warming.” with some of the requirements of share- If you start with the belief — which is certainly holder approval, it is becoming much In some respects, articulating long-term my experience — that in most cases, boards more of a shareholder democracy system. strategy can be a similar exercise. Unless and managements are being very careful, try- With that, companies need to change. A you do it continuously and get the evidence ing to do the right thing for the companies lot of companies have changed and a lot behind it and keep it out in the market- and pursue the right strategy for long-term of companies have not yet taken that step place, you’re going to have a hard time shareholder value, why are shareholder activ- adequately to really articulate their vision. convincing your constituency when they’re ists succeeding? They are succeeding by, one: As Mary pointed out earlier, the first time confronted very short-term and very tangi- identifying some circumstances where that’s you approach your constituency — in this bly in an activist campaign, that they should not necessarily the case. There are some cir- case, your shareholders — in the context of stick with you in the long-term. cumstances where you can look at it and say, an approach by an activist with a specific “There seems to be some real merit here.” agenda and a well-articulated view of what Having said that, and having participated in But two: they are taking advantage of what I the strategy should be, and you haven’t a session at Harvard a couple of weeks ago, view as a failure by companies to adequately done the spadework to do that, then you involving activists, institutional shareholders, communicate what their strategy is on a reg- are going to have an uphill battle in trying outside counsel for firms, ISS, and others ular basis with their key constituencies. That to win in that circumstance. talking about these issues — activism issues is something that is worth real attention. in particular — it’s clear that the institutional Understanding your shareholder base, cre- shareholders are evolving in their thinking. We have moved, over the last 15 to 20 years, ating a comprehensive plan to engage with They are not all of the mind to go with the from a system which was radically different investors at least annually on substance to activists; they have seen a lot of these cam- from the U.K. system to one which is much deal with all the issues that they are con- paigns. They will look at an issue on the more closely aligned with the U.K. The cerned about — the strategy, succession, merits. Their clear message was, “Come U.K. has always had a system where liberal compensation, and so on, will put you in talk to us. Very often, we will respond if we shareholder engagement is the norm. There good stead when you have to actually defend understand and you can articulate your long- are no takeover defenses. Some of the recent a very detailed discussion with activists. term strategy. We will take the short-term hit regulatory changes can be used strategically if we believe in the long-term benefit, but you to develop defenses, as we’ve seen in the The last thing I would say is in some respects need to have that outreach.” most recent deal in the healthcare space. — and this is especially true where companies However, generally speaking, it’s very much are trying to make long-term investments, the The other very particular message that came putting matters to shareholders, convince viability of which may not be clear in the short- out of that discussion was that they like to the shareholders by way of a campaign on term — it’s almost like global warming. How see board members, particularly the chair- both sides of the relative merits, and let the do you get people engaged on global warm- man of the board, and the chairman of shareholders decide. ing? I was at a graduation for my daughter a the compensation committee. Companies

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hear the presentations, and they would ask was a committee of the board which studied some questions. Board members are now it very carefully, but that the board, as a much more engaged. whole, was lucky if it could spend five or six minutes a year on the budget, because they Structurally, management sets the agenda had so many other things to consider. They and the strategy, needs to execute on the relied on the special committee to handle strategy, but boards are much more engaged that situation. in drilling down, acting as the independent buffer, asking the right type of questions I would now like to introduce Matt Hurd. and understanding the business. It is a very positive change. MATTHEW HURD: Thank you, Jack. Congratulations, Tom, on this well-deserved JACK FRIEDMAN: What is the role of recognition. I am Matthew Hurd, partner the General Counsel with the board? in Sullivan & Cromwell. I have worked on healthcare mergers and acquisitions for THOMAS M. MORIARTY: It is a very most of my career. Most of us in the room interesting role. On the one hand you are have worked on both successful and unsuc- part of the executive management team. On cessful mergers and acquisitions. While the the other hand, the General Counsel must definition of a successful transaction will ultimately represent the interests of the share- always involve items like making sure that holder. Translating the guidance grounded the valuation and the strategy is absolutely in that dual role to the board, individually right — and the integration is carried out and collectively, is very important. flawlessly — we can all agree that the defini- tion of a successful transaction has changed JACK FRIEDMAN: You’re the attorney significantly over the past few years. It need to look at those positions, assuming for the corporation — not for the board. now involves measuring success against a that the people who are holding those posi- broader range of criteria — criteria beyond tions will need to and should engage with THOMAS M. MORIARTY: That is my just commercial factors. It also involves their institutional shareholders on a regu- position and that is the role that we play. having that success judged and — in some lar basis. That reinforces that the company We spend a lot of time with our board. One degree impacted by — a broader range of has a strategy; that the board understands of the very positive developments, which stakeholders, such as regulators, industry Creighton is referring to, is leveraging the groups, legislators, the media, the various it and can articulate it; and that executive expertise of our board. The board members types of activists that Creighton was refer- compensation aligns with the strategy. That are very experienced and highly technical ring to, and a whole range of industry and independence and confirmation that you folks in their areas of specialization. We public policy pundits who influence, or at have got an active, engaged board is very have developed a great interaction and dia- least try to influence, the views and actions useful when you are then confronted with logue to be able to leverage that expertise of the other stakeholders. something short-term. across our business. This evolving conception of transactional JACK FRIEDMAN: We have hosted The board’s time commitment is tangible. success results from at least a couple of fac- Chief Justices of Delaware in several It has almost tripled, particularly for folks tors that we are all familiar with from other programs. How have the duties, responsi- who sit on the audit committees of public contexts. First and foremost, governments bilities, and pressures on boards changed companies. The role and the scrutiny that around the world are exerting much greater in recent years? audit committees are under these days is very influence and involvement both in busi- high, and as a result, the engagement level of nesses and in transactions. This involvement CREIGHTON CONDON: From my folks who sit on the audit committees is even has been particularly overt in the banking, perspective, the time commitment has higher than you might see otherwise. insurance, and automotive industries — espe- multiplied for board members. It used to cially since 2008 — but the business leaders be typical for board members to be sent a JACK FRIEDMAN: A General Counsel in energy, technology, and — as Mary referred package of materials shortly before a board commented once that his corporation had to — the food and beverage industry would meeting. They would show up; they would a capital budget of $23 billion a year. There all say the same thing. In healthcare — an

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area that the United States federal govern- reflects what is a very sophisticated view con- ment has regulated for over a century — this cerning the prospect of regulatory change in involvement has taken the form of more this country, and was probably conceived muscular antitrust enforcement; greater over a longish period of analysis. I do not investigative activity by the United States think it was episodic, but I was not involved. Department of Justice and the Office of the Inspector General; higher priority being On the other hand, Pfizer itself stated that given to the enforcement of anti-corruption it found the U.K. takeover regime overly statutes, chiefly the Foreign Corrupt Practices complicated and bureaucratic, and by impli- Act; more whistleblower actions, qui tam cation, this view that it had or experienced suits, and False Claims Act proceedings, like of that process affected its overall ability to the matters Enu was discussing; and most execute on its initiative. importantly, the evolving commercial and conceptual structure of the United States All of these factors require coordination. healthcare delivery system being wrought by And, what is the focus of that coordination in the Affordable Care Act. most successful organizations? In most cases, in my experience, that place is the General At the same time, there is much more of a Counsel’s office. That is the place where the curtain between the public sphere of regula- public policy, regulatory affairs, and govern- tors, legislators, investigators, commentators mental relations functions are all coming — the private sphere of commercial oper- I have been mentioning. This is a transac- together to create success in M&A trans- ations, where most of us tend to spend tion that many pundits thought could never actions. Companies have largely built out our professional lives. This dichotomy or get done from an antitrust perspective, but their business development functions and division is more stark than it has been in ultimately it sailed through, really, without their commercial operations, but the really the recent past, and what I mean by that is any divestiture, small or large. I was involved successful deal-making companies have built there are only a limited number of profes- in the deal, but was not involved in the out and reconceived the General Counsel’s sionals who can easily pass back and forth antitrust work — another firm was — it was office as the place where all of these factors through that curtain and communicate and really a complete success on the part of that are coordinated and managed, and whereby advise with sophistication in both spheres. team. It got through with at least a couple of success in today’s deal-making environment Congressional hearings, some vexatious lit- can most effectively be achieved. So, success in deal-making today involves igation by an industry group, various types taking a much broader view of what con- of antitrust investigations by state attorneys JACK FRIEDMAN: Thank you. I’m stitutes success, and taking a much more general. Obviously, those risks needed to be going to ask questions of two of our panel- holistic and integrated approach to the advi- navigated through, but the real principle for ists, Vincent and Joe. What are the public sory process and the planning process. which that transaction serves as an exam- considerations that the board should take ple is that careful transaction planning can into account in doing M&A deals? Companies that are successful in M&A really only be fully achieved over a longer today are literally never offline or out of term in the manner seamless with the daily VINCENT A. CINO: There are so many contact with their regulatory advisors, espe- evaluation of risks affecting businesses. In levels of complexity with that; there are cially in the areas of antitrust and tax. In healthcare, success is just the flip side of union contracts; and there are predecessor these areas particularly, the strategic vision risk management, at least in my view. policies that may have to be integrated. It is that a company has can largely be a func- a combination of the policies of the differ- tion of how much work it has consistently You fast-forward now to the most recent large ent unions and different countries. expended in considering the accretion of acquisition project in healthcare, Pfizer’s somewhat settled developments in highly failed bid for AstraZeneca — or as Joe would JACK FRIEDMAN: How much informa- sensitive areas. say, AstraZeneca’s successful defense of the tion does a company get about the people Pfizer initiative. On the one hand, Pfizer side of the business before they buy it? If you look at the merger of Medco into felt able, confidently, to propose an inver- Express Scripts two years ago, that is an sion transaction in the midst of a political VINCENT A. CINO: My experience example of a transaction that was highly suc- hue and cry concerning the propriety of is that, there is not a lot of due diligence cessful across this broader set of criteria that these transactions. Pfizer’s ability to proceed on the people side of the business. There

Spring 2014 17 WORLD RECOGNITION of DISTINGUISHED GENERAL COUNSEL

that the company is protected in its deci- it through and at least expanded the virtues sion-making process when some people are of a combined company, to speak to each of being laid off because of the redundancies. their stakeholders in a way they didn’t do.

JACK FRIEDMAN: Joe, I’d like to ask THOMAS M. MORIARTY: While you some questions. In the M&A pro- clearly not being involved in the deal, it cess, when should people like yourself be highlights what Joe has emphasized — the brought into the process? Is this initiated need to take a much broader approach by by the board, a General Counsel, or the looking at the total context of the deal rather investment banker? than the pure financials. As I talked about earlier in my comments, you can’t pursue JOE LOCKHART: The obvious answer, a deal in isolation and to the exclusion of from my perspective, is early. Each individ- other key attributes of your company and ual group should have someone help them what it means to the broader community, think through the broader policy, political because support for the deal can then be and communication aspects. Sometimes much harder to come by. There are a lot of that means the company has an advisor and different ways to address that situation and the board has an advisor, because they have put a very strong story together as to why different situations. In the interests of dis- that combination could have made sense. closure, let me talk a little bit about Pfizer/ But, ultimately, the merger proved not to AstraZeneca. I represented AstraZeneca, be successful. and still do on an ongoing basis. Without getting into great detail on AstraZeneca’s JACK FRIEDMAN: There was a talk that probably should be more in order to under- strategy, I looked at Pfizer’s as a complete Haley Barbour, former Republican governor stand cultures and how the cultures of the failure of imagination, and a very narrowly of Mississippi, gave that’s directly related to two different companies will work together focused effort. They saw their shareholders this. He said that if you want to get broad to make sure there will be a seamless and the markets as the only audience there. litigation reform through, you have to know integration. You may have to rely on con- They made a case that was based on why which constituencies can influence the it was good for both sets of shareholders, political process in that particular situation sultants who know both parties and people and why it would provide more money and or in that area. You approach the press, who used to work for the company who more shareholder value. get opinion leaders and social media, and may have anecdotal information. people talk one-to-one with politicians. The They walked into a political buzz saw that key issue is to be proactive at the beginning JACK FRIEDMAN: What about the issue was relatively easy to ignite, with the whole and to be sure that your strategy and the of integrating the employees in the two virtue of tax inversions. They basically were message you’re communicating is very well companies? How do you avoid the idea that saying, “We’re going to make a lot of money designed to be effective. “our side is being shortchanged?” for all of us, at the expense of U.S. taxpay- ers and it is Congress’ fault.” Guess what? JOE LOCKHART: Yes, I am picking up on VINCENT A. CINO: That’s a challenge. Congress had something to say, as well as what Mary said at the beginning. It is very Typically, in many scenarios, what will hap- a lot of other people. What would have difficult to develop a relationship when you pen is there will be a reduction of force. made it much harder to fight was if they are in a crisis, or have a deal that’s falling There will be redundancies in various had made a much broader case about how apart or running into some trouble. These positions. From our end, being the labor healthcare, patients, and doctors would be things all need to be prepared in advance. employment perspective, we want to make helped. If they had talked to their constit- Stakeholders need to be briefed. They need sure that any decisions that are being made uents and built support in advance, they to understand why you are doing something, are based on objective, evaluated data such would have had a stronger case. When it so that they can support you, or at least as past reviews and who is better suited for came out they had no broad public policy understand it and mute their criticism. You the job. The decisions should not be based leg to stand on, and people will draw their cannot rebuild the plane while you are flying on subjective data or who knows who. own conclusions on why the deal failed. I it. A very strong case, in a major acquisition, There is a whole reduction of force analysis would imagine that if they had the chance includes all the elements of the company, as that you would go through to make sure to do it over again, they would have thought Tom said, and considers the reputation part

Spring 2014 18 WORLD RECOGNITION of DISTINGUISHED GENERAL COUNSEL

of it from the beginning to be as important THOMAS M. MORIARTY: The need in as the financing. The communications and the marketplace for MinuteClinic services policy are part of it. I could imagine Pfizer stems from a growing shortage of primary going forward, knowing that this would dam- care physicians across the country. The age their reputation, but it made so much ability of folks to have access to primary business sense. They never made a broader care is shrinking. MinuteClinic is a argument, so they were hurt both ways. solution to leverage our footprint across the country in a way that can maximize access MATTHEW HURD: I should say, and to these services. not knowing of Joe’s involvement, I actually brought, as part of the written materials, some MinuteClinic started by looking at acute of the AstraZeneca and Pfizer’s documents, conditions, such as earaches, sore throats, which are on the table outside. Speaking and eye infections. It is now extending into only for myself, I actually do not think that more chronic disease management such Pfizer’s effort in this whole thing was poorly as diabetes, cardiovascular-related issues, conceived. I thought it was a well-executed weight loss and other conditions. We are effort. It just happens to be the fact that there in communities and readily accessible. AstraZeneca’s response and its defense were We also now provide sports physicals for better, and that is the way that project worked kids and athletes, as well as work physicals. out. Some examples of the press materials be situations where you could actually go Here is a story to highlight this point. from that project are out on the table. in and try to get an injunction, only with respect to slanderous, libelous or outright We hosted a forum for our senior leaders JACK FRIEDMAN: Thank you very about six months ago and invited in the false comments. It is hard. much. In terms of reputation, I remember head of a major hospital system. We did a General Counsel making a comment that not know he was going to do this, but he JACK FRIEDMAN: Does an employee you cannot keep people in your own organi- brought in an ad from a Sunday paper have a legal right to tell the world what he zation from saying whatever they want, no focused on MinuteClinic’s sports physicals thinks of the employer? matter what your policies are, even if you try services for the Pop Warner football leagues. to trace it down. All you can do is react after The cost is approximately $59. He chal- VINCENT A. CINO: I suspect they do. it is out there. I would like to talk about lenged his staff the next day at a Monday Some comments are subject to varying dealing with social media, whether it is peo- morning staff meeting with two questions: interpretations. ple outside or inside the company. “First, can you tell me how much it would cost for somebody to come to our system What about the situ- VINCENT A. CINO: It is becoming a big JACK FRIEDMAN: to have one of these physicals done?” and part of our practice. There are all types of ation, where it is not the company, it is two “How long would it take for that physical to issues that you face when somebody goes particular employees who are fighting? be scheduled and completed?” on Facebook or Twitter and posts a com- ment about their employer. The NLRB has VINCENT A. CINO: I am a firm believer Putting aside the fact that it took six weeks stepped in at times and said that is pro- in getting two people in a room and hash- for his staff to get back to him, what he tected speech, or a concerted activity, and ing it out to come to some resolution. This learned is that it would cost several hundred you shouldn’t be involved in that. Normally, is your supervisor; this is your employee; dollars to have a sports physical within the when we get a call from an employer, an let’s try and treat each other with some hospital system, and it would take seven to employee has made slanderous comments respect and dignity, and move on. eight weeks to be able to schedule it. about the company. What do we do? How can we stop it and can we fire them? That is JACK FRIEDMAN: Thank you. I have When you look at the pressure that is on very tricky, very complex, in terms of what one more question, and then we will open the existing infrastructure of healthcare you can do. A lot of times, it is better to it up to the audience. across this country, the MinuteClinics are let it lie and step away until the tempera- an access point that can relieve some of ture goes down — and it’s a one-day issue. I want to ask Tom about the MinuteClinics. that pressure. Perhaps most importantly, Sometimes it’s somebody who has a huge What is the concept behind that, and what MinuteClinics can do it at a lower cost for vendetta and he continues. There might need is it fulfilling for your customers? the individual, as well as for the payor.

Spring 2014 19 WORLD RECOGNITION of DISTINGUISHED GENERAL COUNSEL

It has gone from roughly 18% of health plans preclude corporations from owning health- reimbursing for visits at the MinuteClinics to care establishments. There is the concern that over 90%. One statistic my boss likes to refer the patients will not receive the appropriate to, just to see the value that they can deliver, care, or that they will not see their physi- is after every major holiday — whether it be cians. We work to educate policy makers that July 4th, Christmas, New Year’s — he asks MinuteClinic is fully certified by all the accred- how many folks visited our MinuteClinics iting organizations. We operate by clinical on those days. Invariably, it’s in the thou- standards. We also now have the capability to sands. His point is, they were sick enough upload the record of the visit directly into the on a major holiday to leave their house. If patient’s record with that physician, through they did need to seek care, and if they didn’t the electronic medical records systems. We have access to the MinuteClinics, they would want to have a collaborative and coordinated have ended up in the emergency room. If relationship with primary care physicians. you consider the cost savings for the system, that is primarily the philosophy behind it. JACK FRIEDMAN: You have to work carefully with them, getting back to the influ- JACK FRIEDMAN: There was some dis- ence of doctors on the healthcare system? cussion yesterday on TV about VA hospitals by Jack Jacobs, who won the Medal of Honor THOMAS M. MORIARTY: Yes. when he was in the Army. Jacobs said that it does not make any difference how many JACK FRIEDMAN: I have a lighthearted is critical. One of my guiding principles is billions of dollars Congress puts in. The question to ask Tom. In the five minutes a that our lawyers need to be integrated as a problem is there are not enough primary care month that you have free from your work, partner with the business units in order to doctors to have appointments. There needs to what do you like to do? truly understand how the business operates, be a massive scholarship program at medical to help shape strategy, and to avoid pitfalls. schools, because students cannot go into pri- THOMAS M. MORIARTY: Since my We assign a lawyer specifically for the vari- mary care with all of the debt load that they kids are in the audience, I have to say, ous business units across the company, and have once they get out of medical school. spend it with them! There are a lot of differ- the most senior lawyer for that group sits in ent things I enjoy such as reading, playing on the staff meetings of the business units. THOMAS M. MORIARTY: One of golf, and spending time with family. By doing that, they essentially become busi- the key things that we do prior to opening ness partners with it. a MinuteClinic is to talk directly with pri- JACK FRIEDMAN: Does anyone in the mary care physicians in that community. We audience have a question? In terms of who reports to whom, it is inform them of our plans and ask if the doc- primarily a question of who ultimately is tor accepts new patients. This is important to [AUDIENCE MEMBER]: I am senior making the determination as to whether the know because anywhere from 40 to 60% of counsel of American Express. First of work is being done appropriately or not. I folks who come in to a MinuteClinic do not all, congratulations, Tom. Secondly, you am comfortable with divisional GCs not have a primary care physician. We become mentioned the need for in-house counsel to reporting directly to the corporate GC. a referral point and resource point for the be much more strategic and that we should be primary care physicians in that community. business enablers. You also talked about the Where it becomes an issue is when the ulti- Ultimately, you do want folks being seen by fact that the General Counsel represents the mate decision as to what should be done a primary care physician. When a doctor is corporation rather than any particular executive from the legal perspective somehow gets not available, this is an access point to get the of the company. What is your perspective on blurred because of that reporting. That’s care that they need. the effectiveness of General Counsel structures when it needs to be very clear that legal where divisional GCs report to the president decisions and other areas that the office of JACK FRIEDMAN: Is there any resis- of the business unit, and only have a dotted General Counsel has responsibility over tance to this idea? line to the General Counsel? should stay within the scope of that office.

THOMAS M. MORIARTY: It varies by THOMAS M. MORIARTY: First, to get [AUDIENCE MEMBER]: I wanted to state. There are a number of states that have to your question in terms of having law- thank Mr. Friedman for bringing up the corporate practice of medicine restrictions that yers intimately involved in the business; it issue of the doctors being stakeholders.

Spring 2014 20 WORLD RECOGNITION of DISTINGUISHED GENERAL COUNSEL

I wanted to ask Mr. Moriarty and Ms. When you look at the pressure that is on the existing Langowski this question, if they can respond. To what degree are doctors a stakeholder in infrastructure of healthcare across this country, the the decision-making, and how much do you reach out to them when it comes to public MinuteClinics are an access point that can relieve some policy? For example, when we look at the of that pressure. Perhaps most importantly, MinuteClinics expansion of Medicaid and before that came to place, we were already 60,000 doctors short can do it at a lower cost for the individual, as well as of what we needed to treat those patients. Yet for the payor. — Thomas M. Moriarty there wasn’t a plan to expand the number of doctors. In fact, what happened with reim- physician shortage is also felt in the hospital into the day-to-day practice of healthcare. bursement rates for Medicaid and Medicare areas. The collaboration that exists with the There has to be an end at some point to is that we are seeing doctors leaving that hospital healthcare systems, physician groups the downward reimbursement pressure that practice or refusing to take those patients. and MinuteClinics are structured to drive we are placing on providers. Providers are There is also no plan to grow the number alignment across an integrated model. going to have to be really creative in this new of medical schools or grow the number of environment to squeeze more money out of doctors that we need. It is a nice first step, Ultimately, as primary care becomes harder to new arrangements with ACAs, bundled pay- what you are planning with this clinic, but access, and there are fewer doctors, we really ments and other things. It is important to we still need doctors to do that. What we are need physicians to be focused on the most note that now there is excess capacity in the seeing, instead, is that doctors’ practices are critical conditions involved, where the value system. There are companies that are innova- dissolving and they are being taken over by can truly be added and the most impact on tive, like ZocDoc, that go in and help manage hospital corporations to manage for them. people’s lives can be made. By freeing up that For example, it costs almost $30,000 to start that capacity so that you can eliminate that time and working within an integrated model, up an electronic medical records program for excess capacity. It is good for everybody in you can achieve a lot of the cost savings, but a practice, which practically puts them out the system — patients get their appointments of business. Most of what they are taking in also take some of the pressure off the physi- and doctors get their cancellations filled. is going towards overhead. They barely pay cian practice groups and the hospitals. themselves. To what degree are these indi- With the new population coming in, as vidual doctors’ practices being considered JACK FRIEDMAN: In a program we did Tom said, scale is going to be everything. as real stakeholders in the decision-making? in Los Angeles, a woman said she was a Getting scale right, making sure that you How is this going to be impacted when physician and the president of the Harvard can, that you are using the right provider, you’re looking at the implementation of the Medical School Association of Southern at the right time, at the right level, is going APA and how it may be revised? California. She said, “I’m going to give you to be critical for the system. That has been, a topic which will be popular: career oppor- since the beginning, the source of some THOMAS M. MORIARTY: I will start, tunities outside of medicine for doctors. We real frustrating consequences for physicians. Mary, and then I will turn the broader pol- have many colleagues in our chapter who Remember what I said earlier: this is a liv- icy questions over to you. want to be security analysts in healthcare ing law, and they will have to be very active on Wall Street.” Yesterday, there was news in adjusting it to live with it in the future. If you look at how we are structured, our of a study that said that the largest graduate Chief Medical Officer sits on the Executive degree in the United States now is MBAs, JACK FRIEDMAN: I want to thank Committee of the company. It is primarily to which is about 25%. our Distinguished Panelists and especially, drive the message of the importance of physi- our Guest of Honor. It is clear that CVC cians across our company and in the business MARY LANGOWSKI: There are, no Caremark is filled with people who feel good that we do. In the example of MinuteClinics, doubt, a lot of unintended consequences about how they are helping people and are we have approximately 40 arrangements and from the law, and I hear a lot of frustration happy to be with a successful company. alliances with major hospital systems across from physicians. Sometimes there is a lack of the country, because the pressure of the knowledge in terms of how policy translates Thank you very much.

Spring 2014 21 WORLD RECOGNITION of DISTINGUISHED GENERAL COUNSEL

Mary Langowski has extensive experience Mary has also had her own successful con- helping companies navigate and strategically sulting business, where she provided business respond to global and domestic policy and mar- development, government affairs and commu- ketplace trends through effective government nications strategies for clients in the health relations strategies, pursuing business devel- care, biotechnology and innovation sectors. opment opportunities and through effective communications and public affairs campaigns. In addition to her consulting experience, Mary has served as a senior policy advisor Mary has worked with for-profi t and non- to Senator Tom Harkin, where she managed profi t organizations, as well as both federal the senator’s health care policy initiatives and and state governments. Mary has worked priorities, including public health and pre- Mary Langowski extensively with health care and life science vention, Medicare and pharmaceutical policy. Partner, DLA Piper companies to help them navigate complex She was also a member of the U.S. Senate health care reform policies, rules and reg- Agriculture Committee staff and worked on ulations. She advises several organizations rural economic development issues. on their longer term strategic approach to health care reform and marketplace changes. Prior to joining Senator Harkin’s offi ce, Mary Mary also works with organizations on their served as the chief policy advisor at the Iowa response to food policy trends, on emerging Department of Public Health under Governor market strategies, and on corporate develop- Tom Vilsack, where she advised the director ment and philanthropy strategies. and the governor on health policy and was responsible for growing and managing fed- Mary built the fi rm’s Health Care Policy erally funded policy projects. She has also and Regulatory group and serves as former worked in the private sector on health care Senator Tom Daschle’s chief advisor on quality and cost containment issues with large health care and food policy issues. self-insured businesses in Iowa.

Prior Experience Mary also previously served as the president Mary served as a managing director at a and chief operating offi cer for a nonprofi t global AmLaw 100 fi rm, where she chaired community development organization. Over the advocacy team. In that position, she the course of her career, she has advised counseled clients, including national asso- numerous congressional, senatorial, guber- ciations, technology vendors, hospitals and natorial and presidential political candidates. health systems, pharmaceutical companies, provider groups, corporate entities, univer- sities and large nonprofi ts.

DLA Piper We achieve this through practical and inno- In 2005 DLA Piper became one of the larg- vative legal solutions that help our clients est business law fi rms in the world through a succeed. We deliver consistent services merger of unprecedented scope. The strategy across our platform of practices and sectors was simple – to create a truly global fi rm capa- in all matters we undertake. ble of handling the most important legal needs of clients wherever they do business. DLA Piper is a global law fi rm with 4,200 law- Our clients range from multinational, yers in the Americas, Asia Pacifi c, Europe and Global 1000, and Fortune 500 enterprises Building strong client relationships is the the Middle East, positioning us to help compa- to emerging companies developing compass for our business strategy and future nies with their legal needs around the world. industry-leading technologies. They include development. We are grateful for the support of more than half of the Fortune 250 and our clients, our people and our communities, We strive to be the leading global business nearly half of the FTSE 350 or their all of which have made it possible for us to law fi rm by delivering quality and value to subsidiaries. We also advise governments celebrate the milestones and achievements that our clients. and public sector bodies. make up our evolving history.

Spring 2014 22 WORLD RECOGNITION of DISTINGUISHED GENERAL COUNSEL

Joe Lockhart is a Founding Partner and the 1984 Mondale–Ferraro campaign. In Managing Director of The Glover Park 1980, he was Regional Press Coordinator Group and provides clients valuable insight for President Carter’s re-election bid. in media relations and political strategy. He is the former chief spokesman and senior In addition, Joe has a wealth of experience adviser to President Bill Clinton from in strategic communications for a variety 1998–2000, and more recently, he served of clients. As Executive Vice President at as Vice President of global communications Bozell Sawyer Miller, he advised a range of for Facebook from 2011–2013, where he high-profi le corporations and institutions. managed corporate, policy & international communications. An award-winning journalist, Joe has worked Joe Lockhart for both network and cable news outlets. He Founding Partner & Managing Joe, a veteran of political campaigns, served previously held posts as Assignment Editor Director, Glover Park Group as Senior Advisor to Senator John Kerry’s at ABC News and Deputy Assignment 2004 presidential bid. He has also served Manager for CNN in Washington. Joe also as National Press Secretary for the 1996 served as foreign producer for SKY Television Clinton–Gore campaign, Deputy Press News, Europe’s fi rst 24-hour television broad- Secretary for the 1988 Dukakis–Bentsen cast news service. Joe received a Bachelor of campaign, and Assistant Press Secretary for Arts from Georgetown University.

Glover Park Group the White House podium, on the trading campaigns that shape the way critical audi- fl oor and at the news desk. They have coun- ences view our clients and their goals. In a seled CEOs, heads of state and even a few fast-changing world where the stakes have When we formed The Glover Park Group in rock stars. Not only do they understand the never been higher, nothing less will do. 2001, we wanted to make our mark by redefi n- most complex and demanding issues of our ing upwards what a strategic communications times, they have lived them. Their passion We take the focus and execution of great politi- fi rm could be. We made a simple vow: We fuels creative thinking that leads to richer cal campaigns and make it the genetic code for would be different. For us, different means a solutions for our clients. And it makes it our fi rm. We commit ourselves to delivering few simple but important ideas: fun to come to work each day. real time responses to changing conditions.

We hire the brightest people we know from We avoid the structural silos that limit most Substantive expertise and research form the widest range of backgrounds — adver- fi rms and use multi-discipline teams to deliver the core of all of our work, and our senior tising agencies, PR fi rms, corporations, fully integrated solutions to meet our clients’ talent is involved in all of our accounts. non-profi ts, think tanks, government and challenges. Old lines between public and political campaigns, news organizations — private sector, journalist and civilian, outside Today, we are proud to work with a wide and galvanize them with the opportunity agitator and inside power broker are blur- range of clients on some of the most to think big and to think better. Our con- ring. GPG was built to help organizations important and fascinating issues of our sultants have taught at leading universities, navigate this shifting landscape. We combine time. In the process, we have become one volunteered in the developing world and substantive understanding of complex issues of the fastest-growing and most respected served in the military. They have been at with disciplined execution of crisp infl uence communications fi rms in the country.

Spring 2014 23 WORLD RECOGNITION of DISTINGUISHED GENERAL COUNSEL

Vincent A. Cino is the Chairman of (1995), the United States Court of Appeals Jackson Lewis P.C. and is responsible for for the Tenth Circuit (1995), the United the entire fi rm’s day-to-day administration States District Court for the District of New and management. Prior to assuming the Jersey, the United States District Court for role of Chairman, he served as the fi rm’s the District of Connecticut, and the United National Director of Litigation. He also States District Court for the Southern and served on the fi rm’s Executive Committee Eastern Districts of New York. He is a mem- and was Counsel to the fi rm. ber of the American and New Jersey Bar Associations and their litigation sections. Mr. Cino has vast trial experience, hav- ing litigated every conceivable type of His publications include “Boost for Bosses: Vincent A. Cino employment action in many jurisdictions Court Compels Arbitration,” Vincent Chairman, Jackson Lewis P.C. throughout the United States. From 1987 A. Cino and Deborah Martin-Norcross, to 1990, Mr. Cino was Chief of Litigation 130 N.J.L.J. 1354 (1992); “One-Sided Fee in the Offi ce of the Essex County Counsel. Shifting in LAD, CEPA Harms the Legal As Chief of Litigation for Essex County, System,” Vincent A. Cino and David M. Mr. Cino supervised a staff of attorneys as Walsh, 185 N.J.L.J. 755 (2006). well as outside counsel. Prior to that, he was an Assistant Prosecutor for Union County. Mr. Cino served as a Master of the From 1981–1987, Mr. Cino was engaged in Arthur T. Vanderbilt Inn of Court. private practice in Hackensack, New Jersey, concentrating on civil litigation. He has per- In one of his more well-known trials, sonally tried over 100 cases. Mr. Cino represented WNEW-TV, Golden West Television productions, Peter Falk and Mr. Cino received his juris doctor degree Arnold Shapiro, the Oscar-winning pro- from Rutgers University School of Law in ducer of the movie “Scared Straight.” This 1979 and conducted his undergraduate was a libel and invasion of privacy case studies at Rutgers University, from which brought by several high school students. he received a B.A. degree. He also holds a The trial lasted four weeks and resulted in Master’s degree in American Government a no-cause. from Rutgers University. Mr. Cino has lectured extensively on Mr. Cino is a member of the New York trial advocacy. He has been awarded the and New Jersey Bars, the United States highest accolade in Martindale-Hubbell, Supreme Court, the United States Court of an AV rating, a testament to the fact that Appeals for the Third Circuit, the United his peers rank him at the highest level of States Court of Appeals for the Fifth Circuit professional excellence.

Jackson Lewis 100 and Global 100 rankings of law fi rms. areas of practice provides the resources U.S. News — Best Lawyers “Best Law Firms” to address every aspect of the employer/ named Jackson Lewis the 2014 “Law Firm employee relationship. Jackson Lewis has of the Year” in the Litigation-Labor and one of the most active employment litiga- Employment category. The fi rm was also tion practices in the United States, with a named a Tier 1 National “Best Law Firm” current caseload of over 6,500 litigations in Employment Law — Management; Labor and approximately 550 class actions. Founded in 1958, Jackson Lewis is ded- Law — Management; and Litigation — Labor icated to representing management & Employment, and earned a spot on the Jackson Lewis is a founding member of L&E exclusively in workplace law. With over BTI Power Elite for being recognized by cor- Global Employers’ Counsel Worldwide, an 770 attorneys practicing in 55 locations porate counsel as one of the top law fi rms alliance of premier employment law bou- throughout the U.S. and Puerto Rico, in building and maintaining client relation- tique fi rms and practices in Europe, North Jackson Lewis is included in the AmLaw ships. The fi rm’s wide range of specialized America, and the Asia Pacifi c Region.

Spring 2014 24 WORLD RECOGNITION of DISTINGUISHED GENERAL COUNSEL

Creighton Condon is the fi rm’s Senior its acquisition of Old Lane Partners, its sale Partner. Formerly European Managing of Citicorp Electronic Financial Services, Partner and co-head of the fi rm’s Global Inc. to JPMorgan Chase Bank and numer- Mergers & Acquisitions Group, he rep- ous credit card-related transactions resents multinational corporations in • B/E Aerospace in connection with its acquisitions and sales of public and pri- acquisition of the Consumables Solutions vate companies and in joint ventures and business of Honeywell International Inc. regularly provides advice regarding issues of corporate governance and control. • Charter International plc in connection Mr. Condon also represents the mergers with its acquisition by Colfax Corporation and acquisitions groups of a number of • The Special Committee of the Board of Creighton Condon investment banks. Mr. Condon joined the Directors of ARAMARK in connection Senior Partner, fi rm in 1982 and became a partner in 1991. with ARAMARK’s going private transaction He also practiced for several years in the Shearman & Sterling LLP • The Special Committee of the Board of fi rm’s San Francisco offi ce. Directors of HCA Inc. in connection with HCA Inc.’s going private transaction Selected Experience • Synthes in connection with its acquisition Awards & Accolades by Johnson & Johnson and in its acqui- • Ranked in the fi rst tier for U.S. corpo- sitions of N Spine and Spine Solutions rate/M&A in Chambers Global, as a • Cadbury plc in connection with its acqui- leading corporate and M&A lawyer in sition by Kraft, its demerger of its beverage Chambers USA and Chambers UK, as a business, in the acquisition of the Adams Leading Lawyer for U.S. M&A in IFLR, candy business from Pfi zer Inc. and in the and as a Leading Individual in Legal 500 sale of Cadbury’s international beverage UK and Legal 500 (US Special Edition) business to the Coca-Cola Company • Featured as Dealmaker of the Year in • Citigroup in connection with various merg- The American Lawyer (April 2003) in ers and acquisitions transactions, including connection with his representation of its sale of EMI Music Publishing to Sony John W. Henry and New England Sports and EMI Recorded Music to Universal Venture’s acquisition of the Boston Red Music Corp, its acquisition of Metalmark, Sox and New England Sports Network

Shearman & Sterling LLP The fi rm is organized as a single, integrated We represent many of the world’s leading partnership that collaborates to deliver its corporations, fi nancial institutions, emerging Shearman & Sterling LLP distinguishes best to clients. With approximately 850 growth companies, governments and state- itself by harnessing the intellectual strength lawyers in many of the commercial centers owned enterprises. Those clients, in turn, and deep experience of its lawyers across around the world, we operate seamlessly continue to choose us for the market-defi ning its extensive global footprint. As one of the across practice groups and offi ces and expertise of our accomplished cross-border fi rst law fi rms to establish a presence in key provide consistently superior results. Our legal teams. We have a dedicated focus on international markets, we have led the way in lawyers come from some 80 countries, building partnerships with our clients for serving clients wherever they do business. This speak more than 60 languages and practice their success, and they appreciate our direct innovative spirit and the experience we have U.S., English, EU, French, German, Italian partner involvement on day-to-day matter developed over our 140-year history make us and Hong Kong law. In addition, nearly management. With a deep understanding of the “go-to” law fi rm for seamless service. From one-half of our lawyers practice outside the our clients’ needs, we develop creative ways major fi nancial centers to emerging markets, United States. From complex cross-border to address their problems and are ideally situ- we have the reach, depth and global perspective transactions to exclusively local deals, cli- ated to counsel them in this challenging 21st necessary to advise our clients on their most ents rely on our vast international network century global economy. complex worldwide business needs. to help accomplish their business goals.

Spring 2014 25 WORLD RECOGNITION of DISTINGUISHED GENERAL COUNSEL

Matthew G. Hurd advises companies and • Pharmasset, an 80-employee clinical stage their directors on domestic and cross-border pharmaceutical company, in its $11 billion mergers, acquisitions and similar strategic acquisition by Gilead — a transaction for transactions. For over two decades, Mr. Hurd which Mr. Hurd was named The American has been actively involved in the development Lawyer’s “Dealmaker of the Week.” of the Firm’s Healthcare and Life Sciences • Amgen’s acquisition of deCODE Genetics, Group, of which he is Co-Head. He also has an Icelandic company with unrivaled capa- signifi cant expertise with fi nancial institu- bilities and resources for analyzing and tions and technology companies. understanding the human genome • Bayer’s proposed $1.2 billion takeover Matthew Hurd Recent Activity of Schiff Nutrition, one of the leading Partner, Sullivan & Cromwell LLP • Bayer’s pending $14.2 billion acquisition branded vitamin and nutritional supple- of the consumer care business of Merck ment companies in the United States. — the second-largest acquisition in Bayer’s long corporate history — and its $2.9 bil- Recognitions lion acquisition of Algeta ASA Featured in Law360’s Healthcare and Life • CVS Caremark’s $2.1 billion acquisition Sciences Q&A (July 2012) of Coram from Apria Healthcare Profi led in Practical Law The Journal’s “Expert’s • Amgen’s completed $10.5 billion cash View” column (February 2012) on trends and tender offer for Onyx Pharmaceuticals developments in public M&A deals • Bayer’s completed $1.1 billion cash tender offer for Conceptus, the second-largest Named “Dealmaker of the Week” (November 23, 2011) by The American North American acquisition in Bayer’s Lawyer for his role as counsel to Pharmasset corporate history in its acquisition by Gilead Sciences • CVS Caremark’s 50/50 joint venture with Cardinal Health, to form the largest Recognized as one of the Lawdragon 500 generic sourcing entity in the U.S. Leading Lawyers in America (2011-2013) • Perrigo Company’s $8.6 billion acquisi- Recognized by The Best Lawyers in America as tion of Elan Pharmaceuticals a leading lawyer in mergers and acquisitions • Medco, North America’s leading pharmacy (2007, 2008, 2009, 2010, 2011, 2012, 2013) benefi ts management provider, in its $34.3 billion acquisition by Express Scripts New York Super Lawyers (2012, 2013)

Sullivan & Cromwell LLP The Firm’s lawyers work as a single part- companies; fi nancial institutions; private nership without geographic division. S&C funds; governments; educational, charitable Sullivan & Cromwell LLP provides the hires the very best law school graduates and and cultural institutions; and individuals, highest quality legal advice and representa- trains them to be generalists within broad estates and trusts. S&C’s client base is tion to clients around the world. The results practice areas. The Firm promotes lawyers to exceptionally diverse, a result of the Firm’s the Firm achieves have set it apart for more partner almost entirely from among its own extraordinary capacity to tailor work to spe- than 130 years and have become a model associates. The result is a partnership with cifi c client needs. for the modern practice of law. Today, S&C a unique diversity of experience, exceptional is a leader in each of its core practice areas professional judgment and a demonstrated S&C comprises approximately 800 lawyers and in each of its geographic markets. history of innovation. who serve clients around the world through a network of 12 offi ces, located in leading S&C’s success is the result of the quality Clients of the Firm are nearly evenly fi nancial centers in Asia, Australia, Europe of its lawyers, the most broadly and deeply divided between U.S. and non-U.S. enti- and the United States. The Firm is head- trained collection of attorneys in the world. ties. They include industrial and commercial quartered in New York.

Spring 2014 26 WORLD RECOGNITION of DISTINGUISHED GENERAL COUNSEL

Enu Mainigi has extensive experience in breach of fi duciary duty, including in the complex civil and criminal litigation in state multi-jurisdictional or class action setting. and federal courts throughout the country She also advises corporations on internal and has tried multiple cases. investigations and compliance issues. In recent years, Ms. Mainigi has also devoted a A signifi cant part of Ms. Mainigi’s prac- portion of her practice to both products lia- tice includes leading the representation of bility defense and legal malpractice defense. corporations and individuals under investi- gation by the government either criminally Ms. Mainigi is a current member of the or in the context of the civil False Claims Firm’s Executive Committee and a past Act. Ms. Mainigi has defended a signifi cant member of the Firm’s Hiring Committee. Enu Mainigi number of health care companies, PBMs, In the winter of 2010–2011, Ms. Mainigi Partner, Williams & Connolly LLP pharmaceutical companies, hospitals, nurs- spent several months as Chair of the ing homes, accounting fi rms and other companies contracting with the government Transition of Governor Richard L. Scott of as well as major executives at all stages of Florida, a long-time client of the Firm. Ms. criminal or False Claims Act investigation Mainigi joined Williams & Connolly LLP and litigation. Ms. Mainigi has spoken in January 1997 and was elected to the part- frequently on topics related to government nership in December 2002. investigations and the False Claims Act. Immediately prior to joining Williams Ms. Mainigi also routinely defends corpo- & Connolly LLP, Ms. Mainigi served as rations in commercial disputes involving Director of Policy and Research for Senator civil fraud, breach of contract, ERISA and Robert Dole’s 1996 Presidential campaign.

Williams & Connolly LLP Founded in 1967 by legendary litigator Edward and trial counsel for Merck in litigation Bennett Williams, the fi rm was initially best concerning the anti-infl ammation drug known for defending individuals in criminal Vioxx. The fi rm has a thriving intellectual and civil matters. The fi rm represented Oliver property practice, which has successfully In an era of global megafi rms, Williams North before Congress and at trial over his defended patents protecting products with & Connolly LLP is a unique institution. involvement in the Iran-Contra scandal. The hundreds of millions of dollars in annual Although the fi rm handles cases all over fi rm also successfully represented President Bill sales. The fi rm has also presented oral argu- the world, the fi rm’s approximately 275 Clinton in the fi rst impeachment trial of a sit- ment to the Supreme Court four times in lawyers are all based in a single offi ce in ting president in over a century. More recently, the last three years. The fi rm’s corporate Washington, D.C. With one exception, all the fi rm represented the late Senator Ted clients include major global companies of the fi rm’s partners over the last 25 years Stevens at trial on charges of making false state- from virtually every industry, including have been trained at the fi rm and promoted ments; the indictment was dismissed after it ADM, General Electric, Pfi zer, Sony, Sprint from within. As a result, Williams & was revealed that the government had engaged Nextel, and UBS. In addition, the fi rm Connolly has a collaborative and collegial in prosecutorial misconduct. has represented numerous law fi rms and culture unlike that of any other law fi rm. accounting fi rms in professional responsi- Williams & Connolly is now equally well- bility and other litigation; the Washington Williams & Connolly has long been regarded known for handling “bet-the-company” civil Post recognized Williams & Connolly as as one of the nation’s premier law fi rms for liti- litigation at the trial and appellate levels. the fi rm that other law fi rms “turn to when gation, and litigation is the fi rm’s primary focus. The fi rm serves as national coordinating they’re in trouble.”

Spring 2014 27