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April 22, 2020

HHS Issues Advisory Opinion Addressing PREP Act Immunity Issues

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On April 14, 2020, the Department of Health and Human Services (HHS) General Counsel issued an omnibus advisory opinion (Opinion) that addresses questions and concerns about the scope of immunity during the COVID-19 pandemic pursuant to the Public Readiness and Emergency Preparedness Act (PREP Act).1 The PREP Act provides immunity from liability to certain entities and individuals for claims of loss that have a causal relationship to the administration or use of a Covered Countermeasure in the event the Secretary of HHS makes a determination that a threat to health constitutes, or in the future may constitute, a public health emergency.2 The Secretary of HHS has issued a PREP Act Declaration, effective as of February 4, 2020, to provide liability immunity to "Covered Persons" who engage in "Recommended Activities" related to medical "Covered Countermeasures" against COVID-19 (COVID-19 Declaration).3 The COVID-19 Declaration was amended on April 10, 2020 (April Amendment).4 This Advisory updates our original Advisory on the PREP Act and the COVID-19 Declaration to incorporate and discuss the guidance provided in the Opinion and the changes made in the April Amendment.

Guidance Provided by the HHS in the Opinion

The Opinion provides guidance on: (1) the scope of immunity; (2) what can be considered a "Covered Countermeasure"; (3) who is considered a "Covered Person"; (4) limitations on immunity and the need to take reasonable precautions; and (5) available compensation. While helpful guidance, the Opinion is not binding law.

Activities That Qualify for Immunity

Pursuant to the COVID-19 Declaration, liability immunity is afforded to Covered Persons only for "Recommended Activities" involving Covered Countermeasures that are related to "(a) Present or future federal contracts, cooperative agreements, grants, other transactions, interagency agreements, memoranda of understanding, or other federal agreements, or (b) Activities authorized in accordance with the public health and medical response of the Authority Having Jurisdiction to prescribe, administer, deliver, distribute or dispense the Covered Countermeasures following a Declaration of an emergency."5 The Opinion explains that these provisions are intended to include "any arrangement with the federal government, or any activity that is part of an authorized emergency response at the federal, regional, state, or local level."6 Moreover, the opinion clarified that the federal Public Health Emergency declaration on January 31, 2020 means that the immunity granted by the PREP Act applies regardless of whether state or local authorities have declared states of emergencies.

The Opinion also notes that PREP Act immunity must be read "in light of the PREP Act's broad, express-preemption provision," but is not absolute.7 The Opinion provides three examples where immunity will not apply:

  • federal enforcement actions brought by the federal government;
  • claims under federal law for equitable relief;
  • claims not sounding in personal injury or damage to property.8

Covered Countermeasures

Liability protection under the PREP Act is limited to those claims caused by, arising out of, relating to, or resulting from the manufacturer, distribution, administration or the use of a "Covered Countermeasure."9 The Opinion explains that '[a]ny drug, device, or biological product that is approved, cleared, or licensed by the FDA and is used to diagnose, mitigate, prevent, treat, cure, or limit the harm of COVID-19 is a covered countermeasure."10 While there are too many Covered Countermeasures to list them all, the Opinion clarified that additional administrative and executive Orders have expanded the definition of a Covered Countermeasure beyond what is in the COVID-19 Declaration.11 For example, the CARES ACT amended the PREP Act to add certain respirators that may not be medical devices to the list of Covered Countermeasures.12 Moreover, the Opinion provides links to medical devices and therapeutics that are Covered Countermeasures subject to an Emergency Use Authorization.13

Under the PREP Act, Covered Countermeasures also include certain qualified pandemic or epidemic products.14 The Opinion clarifies that "qualified pandemic or epidemic products" must be used for COVID-19, and must be: (1) approved, licensed, or cleared by FDA; (2) authorized under an Emergency Use Authorization; (3) described in an Emergency Use Instruction; or (4) used under either an Investigational New Drug application or an Investigational Device Exemption.15

The Opinion also provides, however, that a reasonable belief standard will apply to the determination as to what is a Covered Countermeasure. Therefore, a "person or entity that otherwise meets the requirements for PREP Act immunity will not lose that immunity—even if the product is not a covered countermeasure—if that person or entity reasonably could have believed that the product was a covered countermeasure."16

Covered Persons

The PREP Act's liability immunity applies to "Covered Persons," which include Manufacturers, Distributors, Program Planners, and Qualified Persons, as defined in the PREP Act.17 The Opinion provides further guidance on the definitions of Program Planners and Qualified Persons. Specifically, the Opinion reiterates that the COVID-19 Declaration provides that private sector employers or community groups can be considered a Program Planner in certain situations.18 The Opinion also notes that Qualified Persons can include certain licensed health care providers and individuals identified by the Secretary in the COVID-19 Declaration.19 Additionally, the Opinion clarifies that the COVID-19 Declaration provides that public agencies can extend PREP Act immunity by authorizing a person to prescribe, administer, deliver, distribute or dispense the Covered Countermeasures.20 These public agencies can include local, city, state or federal agencies that have legal responsibility to respond to the COVID-19 crisis, such as law enforcement or public health officials.

As with Covered Countermeasures, the Opinion further provides that "an entity or person that otherwise meets the requirements for PREP Act immunity will not lose that immunity—even if the entity or person is not a covered person—if that entity or person reasonably could have believed, under the current, emergent circumstances, that the person was a covered person."21

Limitations on Immunity and Reasonable Precautions

The Opinion explains that while immunity is broad, it is not without limitations. Immunity does not cover claims for death or serious physical injury proximately caused by willful misconduct.22 However, a finding of "willful misconduct" is subject to additional requirements under the PREP Act:

  • Acts or omissions of a Manufacturer or Distributor will not constitute willful misconduct unless the Secretary or Attorney General initiates an enforcement action, or if an enforcement action is initiated, willful misconduct will not be found if the action is resolved without imposing a criminal, civil, or administrative penalty.23
  • Acts or omissions of a Program Planner or Qualified Person will not constitute willful misconduct if the actions were consistent with the Secretary's directions/guidelines and proper notice of the serious injury or death was provided to the Secretary or local health authority.24

However the Opinion encourages all covered persons using or administering Covered Countermeasures to document the reasonable precautions they have taken to safely use the Covered Countermeasures.25

Compensation for Injuries

The PREP Act provides for a Countermeasures Injury Compensation Program (CICP), through which compensation may be available to eligible requesters. The Opinion notes that compensation for injuries is more limited than the liability immunity afforded under the PREP Act. While the PREP Act immunity extends to all claims for loss, the CICP provides compensation only for eligible claims of serious physical injury or death.26 The Opinion further provides that the CICP is a payer of "last resort" and "benefits are reduced by the amounts payable by other public and private third-party payers (such as health insurance and workers' compensation)."27

The April Amendment to the COVID-19 Declaration

On April 10, 2020, the HHS Secretary Amended the COVID-19 Declaration to include reference to certain respiratory protective devices. The amendment was published on April 15, 2020. Before issuing a Declaration under the PREP Act, the Secretary is required to determine: (1) that a disease or other health condition or threat to health constitutes a public health emergency; or (2) that there is a credible risk that the disease, condition, or threat may constitute such an emergency.28 The COVID-19 Declaration originally stated that the HHS Secretary "determined that the spread of SARS-CoV-2 or a virus mutating therefrom and the resulting disease COVID-19 constitutes a public health emergency."29 The April Amendment provides that the Secretary further determined that use of any respiratory protective device approved by the National Institute for Occupational Safety and Health is a priority for use during the COVID-19 health emergency to aid the response of the nation's healthcare community to the COVID-19 outbreak.30 Likewise the definition of Covered Countermeasures was revised to include these respiratory devices and the effective time period was revised to incorporate the inclusion of these respiratory devices.31

© Arnold & Porter Kaye Scholer LLP 2020 All Rights Reserved. This Advisory is intended to be a general summary of the law and does not constitute legal advice. You should consult with counsel to determine applicable legal requirements in a specific fact situation.

  1. Department of Health and Human Services, Office of the General Counsel, Advisory Opinion On The Public Readiness And Emergency Preparedness Act And The March 10, 2020 Declaration Under The Act, April 14, 2020.

  2. The 2005 Public Readiness and Emergency Preparedness Act, 42 U.S.C. §247d-6d(b)

  3. Declaration Under the Public Readiness and Emergency Preparedness Act for Medical Countermeasures Against COVID-19, 85 Fed. Reg. 15198 (March 17, 2020).

  4. Amendment to Declaration Under the Public Readiness and Emergency Preparedness Act for Medical Countermeasures Against COVID-19, 85 FR 21012-02 (April 15, 2020). The amendment as published on April 15, 2020.

  5. COVID-19 Declaration, 85 Fed. Reg. 15198 at 15202

  6. Opinion at 2.

  7. Id.

  8. Id.

  9. PREP Act, §247d-6d(a)(2)(B).

  10. Opinion at 3.

  11. Id.

  12. PREP Act, § 247d-6d(i)(1)(D); Coronavirus Aid, Relief, and Economic Security (CARES) Act § 3103, Pub. L. No. 116-136 (March 27, 2020).

  13. Opinion at 4

  14. PREP Act, § 247d-6d(i)(1)(A)

  15. Opinion at 4

  16. Id. at 4-5.

  17. PREP Act, § 247d-6d(i)(2).

  18. Opinion at 5-6; COVID-19 Declaration, 85 Fed. Reg. at 15,202

  19. PREP Act, § 247d-6d(i)(8)

  20. Opinion at 6.

  21. Id. at 7.

  22. § 247d-6d(c)-(d). Willful Misconduct is defined as an act or omission that is taken: (1) intentionally to achieve a wrongful purpose; (2) knowingly without legal or factual justification; and (3) in disregard of a known or obvious risk that is so great as to make it highly probable that the harm will outweigh the benefit. To establish willful misconduct, a plaintiff has the burden of proving all three conditions with clear and convincing evidence. PREP Act, § 247d-6d(c).

  23. PREP Act, § 247d-6d(c)(5).

  24. Id. at (c)(4)

  25. Opinion at 8.

  26. Id.

  27. Id.

  28. PREP Act, §247d-6d(b)(1)

  29. COVID-19 Declaration, 85 Fed. Reg. at 15,201

  30. April Amendment, 85 FR 21012-02 at 21,013-21,014.

  31. Id. at 21,014