MEMORANDUM
PRIVILEGED AND CONFIDENTIAL — ATTORNEY WORK PRODUCT
FROM: Jeffrey Park, Lead Associate, Litigation (General), Calderwood & Harkness LLP
TO: Leonard Cross, Responsible Partner; Nathaniel Bower, Billing Partner; Audrey Zhou, Working Associate
DATE: October 31, 2023
RE: Privilege and Work-Product Protection Protocol — OPDP Inquiry re Zelvara® (trepivant sodium) Promotional Materials; FDA Reference OPDP-2023-1847
MATTER NO.: 1018-00002
CLIENT: Penterra Pharmaceuticals Corp. (NYSE: PTPH)
CONFIDENTIALITY LEGEND: This memorandum is a privileged and confidential attorney-client communication and attorney work product prepared in anticipation of litigation and in connection with the provision of legal advice. It is not to be disclosed to any person outside of Calderwood & Harkness LLP without prior authorization from the Responsible Partner. Any unauthorized disclosure, copying, or distribution of this memorandum or the information contained herein is strictly prohibited.
I. PURPOSE AND SCOPE OF THIS PROTOCOL
This memorandum establishes mandatory protocols for the preservation of attorney-client privilege and work-product protection throughout Calderwood & Harkness LLP's engagement by Penterra Pharmaceuticals Corp. ("Penterra" or the "Client") in connection with the inquiry initiated by the Food and Drug Administration's Office of Prescription Drug Promotion ("OPDP"), bearing FDA reference number OPDP-2023-1847 (the "OPDP Inquiry"). Strict adherence to these protocols is essential to safeguard the confidentiality of communications between counsel and the Client, to protect work product prepared in anticipation of potential enforcement proceedings, and to ensure that the legal interests of Penterra are not compromised by inadvertent disclosure or the erosion of privilege.
This engagement was opened on October 30, 2023, pursuant to an engagement letter of the same date executed by Leonard Cross on behalf of Calderwood & Harkness LLP and Margaret Tan, Executive Vice President and General Counsel, on behalf of Penterra Pharmaceuticals Corp. The engagement letter sets forth the terms and conditions of the representation, including the scope of services, fee arrangements, staffing, and the Client's agreement to cooperate fully with the firm's privilege-protection requirements.
The scope of the engagement encompasses the following four interrelated workstreams:
(a) Internal Investigation. Conducting an internal investigation into Penterra's promotional practices relating to Zelvara® (trepivant sodium), including the development, review, approval, and dissemination of promotional materials that are the subject of the OPDP Inquiry.
(b) FDA Response. Preparing Penterra's formal response to FDA's OPDP, including the drafting, review, and submission of any written response letters, supporting analyses, and supplemental materials requested by the agency.
(c) Corrective-Action Advisory. Advising Penterra on corrective actions that may be warranted in light of the OPDP Inquiry's findings, including revisions to promotional materials, modifications to Promotional Review Committee ("PRC") processes and standard operating procedures, and any retraining or remediation measures.
(d) Securities-Disclosure Advice. Providing advisory support on securities-disclosure obligations arising from the OPDP Inquiry, including but not limited to potential disclosure requirements under SEC regulations and the evaluation of materiality in connection with Penterra's periodic filings and investor communications.
The OPDP Inquiry specifically concerns three promotional materials developed and disseminated as part of Penterra's "Clarity Campaign" for Zelvara®, each identified by its internal material identification number:
1. Digital Banner Advertisement — Material ID: ZVR-2023-BNR-044
2. Physician Email Blast — Material ID: ZVR-2023-EML-019
3. Sales Representative Detail Aid — Material ID: ZVR-2023-DA-007
These materials are at the center of the OPDP's concerns and will be the primary focus of the internal investigation and the formal response to the agency.
It must be emphasized that the OPDP Inquiry raises significant potential enforcement risk for Penterra. The issuance of an untitled letter or a Warning Letter by OPDP, while itself a regulatory action, may also serve as a predicate for referral to the Department of Justice ("DOJ") or the Office of Inspector General ("OIG") of the Department of Health and Human Services for further investigation or enforcement proceedings, including potential civil or criminal liability under the Federal Food, Drug, and Cosmetic Act and the False Claims Act. The possibility of such downstream enforcement action makes privilege protection critically important at every stage of this engagement.
All members of the Calderwood & Harkness LLP engagement team, together with any co-counsel, consultants, or other persons engaged under counsel's direction, must adhere strictly to the protocols set forth in this memorandum. Failure to do so may result in the waiver of attorney-client privilege or work-product protection, with potentially severe and irreversible consequences for the Client's legal position.
II. APPLICABLE LEGAL PRINCIPLES
A. Attorney-Client Privilege
The attorney-client privilege is the oldest recognized privilege for confidential communications in the common law. It protects from compelled disclosure confidential communications made between an attorney and a client for the purpose of obtaining or providing legal advice. Under federal common law, which will govern privilege questions in connection with any federal enforcement proceeding or investigation arising from the OPDP Inquiry, the privilege applies where: (1) a communication is made (2) between privileged persons (i.e., client, attorney, and their respective agents) (3) in confidence (4) for the purpose of obtaining or providing legal assistance to the client. See In re Grand Jury Subpoena, 599 F.3d 574, 578 (7th Cir. 2010); United States v. Zolin, 491 U.S. 554, 562 (1989).
Because Penterra Pharmaceuticals Corp. is headquartered at 480 Overlook Drive, Suite 700, Summit, New Jersey 07901, New Jersey state law may also be relevant to privilege questions in certain contexts, including state court proceedings and state regulatory matters. Under New Jersey law, the attorney-client privilege is codified at N.J.S.A. 2A:84A-20 and N.J.R.E. 504, and is construed consistently with federal common-law principles. Both federal and New Jersey privilege law recognize that the privilege must be strictly construed and that the party asserting the privilege bears the burden of establishing each of its elements.
In the corporate context, the privilege applies to communications between a corporation's counsel and the corporation's authorized representatives. The landmark decision of the Supreme Court of the United States in Upjohn Co. v. United States, 449 U.S. 383 (1981), established that the attorney-client privilege extends to communications between corporate counsel and lower-level employees, provided that the communications are made at the direction of corporate superiors for the purpose of obtaining legal advice and concern matters within the scope of the employees' duties. The Upjohn framework is controlling in the federal context and is relevant to this engagement because the internal investigation will require communications with a range of Penterra personnel, including field sales representatives who are not members of senior management.
The privilege holder in this matter is Penterra Pharmaceuticals Corp. Only Penterra, acting through its General Counsel, Margaret Tan, has the authority to waive the attorney-client privilege. No individual employee or officer of Penterra may unilaterally waive the privilege, and no member of the Calderwood & Harkness engagement team has the authority to waive the Client's privilege. All decisions regarding potential voluntary or strategic waiver of privilege must be made by Penterra's General Counsel in consultation with the Responsible Partner, Leonard Cross.
It is important to note that the attorney-client privilege protects communications, not underlying facts. A client cannot shield a fact from disclosure merely by communicating that fact to an attorney. The privilege protects the communication itself — the fact that the communication was made, its contents, and the advice given in response — but does not immunize the underlying factual information from discovery or compelled disclosure through other means. This distinction is particularly important in this engagement, where business records, promotional materials, PRC meeting minutes, and CRM data are underlying facts that are not themselves privileged merely because they are transmitted to counsel for review.
B. Work-Product Doctrine
The work-product doctrine, first recognized in Hickman v. Taylor, 329 U.S. 495 (1947), and codified in Federal Rule of Civil Procedure 26(b)(3), protects from discovery documents and tangible things prepared by or for a party or its representative in anticipation of litigation or in preparation for trial. The doctrine is broader than the attorney-client privilege in that it protects materials prepared by non-attorneys (such as consultants or investigators) at the direction of counsel, and it extends to the selection, organization, and compilation of factual materials reflecting counsel's litigation strategy.
Under Rule 26(b)(3), there is an important distinction between two categories of work product:
(a) Ordinary Work Product. Documents and tangible things containing facts gathered in anticipation of litigation or in preparation for regulatory proceedings. Ordinary work product is subject to a qualified immunity and may be discoverable upon a showing of substantial need and undue hardship in obtaining the equivalent materials by other means.
(b) Opinion Work Product. Materials reflecting the mental impressions, conclusions, opinions, and legal theories of an attorney. Opinion work product receives near-absolute protection and is virtually never discoverable, even upon a showing of substantial need.
Analogous state rules provide similar protections. New Jersey's work-product doctrine, as set forth in N.J. Court Rule 4:10-2(c), tracks the federal rule and affords comparable protections to materials prepared in anticipation of litigation.
In this matter, the OPDP Inquiry and the attendant potential for enforcement action — including the issuance of a Warning Letter, possible referral to DOJ or OIG, and the prospect of civil or criminal proceedings under the Federal Food, Drug, and Cosmetic Act or the False Claims Act — establish the requisite anticipation of litigation or adversarial regulatory proceedings necessary to invoke the work-product doctrine. The internal investigation, the preparation of Penterra's FDA response, and the development of corrective-action recommendations are all activities undertaken in anticipation of such proceedings.
A particular challenge in this engagement involves dual-purpose documents — materials that serve both a legal purpose and a business purpose. For example, a revised standard operating procedure for the PRC may simultaneously reflect counsel's legal recommendations (privileged) and constitute a business process document intended for implementation (non-privileged in its final, implemented form). Courts have adopted varying tests for determining whether dual-purpose documents are protected. In the Second Circuit and the majority of federal circuits, courts apply a "primary purpose" test, under which a document is protected if the primary motivating purpose for its creation was to obtain or provide legal advice or to prepare for litigation. See In re Grand Jury Subpoena, 731 F.3d 1037 (10th Cir. 2013). To preserve the applicability of work-product protection to dual-purpose documents in this engagement, team members should take the following steps: clearly segregate legal analysis from business implementation documents; ensure that drafts containing counsel's input are maintained separately from final business records; and, where practicable, frame the creation of such documents in terms of the legal advice being sought or provided.
C. Common-Interest / Joint-Defense Considerations
The common-interest doctrine (sometimes referred to as the joint-defense privilege) is an extension of the attorney-client privilege that permits parties with a shared legal interest to exchange privileged communications without waiving the privilege. Under federal common law, the doctrine applies where: (1) the parties share a common legal interest (not merely a commercial or business interest); (2) the communications are made in furtherance of that common legal interest; and (3) the communications are otherwise privileged. See United States v. Schwimmer, 892 F.2d 237, 243 (2d Cir. 1989); In re Teleglobe Commc'ns Corp., 493 F.3d 345, 364 (3d Cir. 2007).
If co-counsel is engaged in this matter — specifically, Whitfield Bauer & Associates LLP, an FDA regulatory specialist firm that Calderwood & Harkness anticipates retaining with Penterra's consent — the common-interest doctrine may be invoked to preserve the privilege over communications shared between Calderwood & Harkness, Whitfield Bauer, and the Client. However, the protection afforded by the common-interest doctrine is not automatic. Courts require evidence that the parties had a genuine common legal interest and that the communications were made pursuant to an agreement, whether express or implied, to pursue a joint legal strategy.
To maximize the protection afforded by the common-interest doctrine, a formal written common-interest agreement should be executed among Calderwood & Harkness LLP, Whitfield Bauer & Associates LLP, and Penterra Pharmaceuticals Corp. if and when Whitfield Bauer is formally retained. The agreement should specify the scope of the common legal interest, the parameters of permissible information sharing, and the procedures for maintaining the confidentiality of shared communications. Detailed protocols for the anticipated engagement of Whitfield Bauer are set forth in Section VII of this memorandum.
III. DESIGNATION OF AUTHORIZED PERSONS
The preservation of privilege requires that confidential communications be limited to a defined group of authorized individuals. The inadvertent or careless disclosure of privileged materials to unauthorized persons — whether within or outside the organization — can result in waiver of the privilege. Accordingly, the following individuals are designated as "Authorized Persons" for purposes of this engagement.
A. Calderwood & Harkness LLP Engagement Team
The Calderwood & Harkness LLP engagement team for this matter consists of the following attorneys:
The engagement team is currently limited to these four individuals. Any additional Calderwood & Harkness attorneys, paralegals, or support staff who may need to be involved in the matter — whether for document review, research, administrative support, or any other purpose — must be approved in advance by Leonard Cross before receiving access to matter files, communications, or any privileged or work-product materials. Requests for additional staffing should be directed to Jeffrey Park, who will coordinate approval with the Responsible Partner.
B. Penterra Pharmaceuticals Corp. — Authorized Client Contacts
The following Penterra personnel are designated as Authorized Client Contacts for purposes of privileged communications relating to this engagement:
Margaret Tan, Executive Vice President & General Counsel. Ms. Tan is the primary client contact for all aspects of the engagement. She is the sole individual authorized to waive the attorney-client privilege on behalf of Penterra Pharmaceuticals Corp. All significant communications, strategic decisions, and privilege-related determinations should be coordinated with or through Ms. Tan.
Dr. Rajeev Anand, M.D., Ph.D., Chief Medical Officer. Dr. Anand is authorized for communications regarding the clinical and medical-affairs aspects of the OPDP Inquiry, including the scientific basis for the promotional claims at issue, the clinical data supporting the Zelvara® prescribing information, and any medical-affairs review or oversight of the promotional materials.
Christine Holloway, Vice President, Regulatory Affairs. Ms. Holloway is authorized for communications regarding FDA regulatory matters, including the history of Zelvara®'s regulatory submissions, the approved labeling, prior OPDP correspondence (if any), and the regulatory framework applicable to prescription drug promotion.
Derek Foss, Vice President, Commercial Operations & Marketing. Mr. Foss is authorized for communications regarding the Clarity Campaign, Penterra's promotional strategy for Zelvara®, the engagement and management of Ridgeline Health Analytics LLC as the campaign vendor, and the management and oversight of Penterra's sales force, including the 14 identified Northeast-region sales representatives.
Dr. Lina Gerhardt, Pharm.D., Senior Director, Medical Affairs. Dr. Gerhardt is authorized for communications regarding the medical-affairs review of promotional materials, including the review processes and standards applied by the medical-affairs function, and the Promotional Review Committee deliberations relating to the three materials at issue.
Alan Renwick, Director, Promotional Review Committee. Mr. Renwick is authorized for communications regarding the PRC's processes and procedures, PRC meeting minutes and records, the material-approval history for the three materials at issue, and any deviations from standard PRC review protocols.
Communications with any other Penterra personnel — including but not limited to field sales representatives, marketing staff, medical science liaisons, or personnel in functions other than those listed above — should be conducted only with the advance approval of Margaret Tan and in consultation with Jeffrey Park. This restriction is particularly important with respect to communications with field sales representatives, whose statements may not be protected by the attorney-client privilege unless proper Upjohn protocols are followed. The procedures for conducting interviews of Penterra employees are set forth in Section V.A below.
C. Third-Party Consultants and Co-Counsel
The following third parties have been designated as anticipated participants in this engagement, subject to the execution of appropriate engagement letters, confidentiality agreements, and (where applicable) common-interest agreements:
Tavrenis Stern Consulting Group LLC (311 South Wacker Drive, Suite 2400, Chicago, Illinois 60606). Tavrenis Stern is an e-discovery and forensic review consulting firm to be engaged under counsel's direction for purposes of data collection, processing, and review platform hosting. The Engagement Lead for Tavrenis Stern is Patricia Okoro. Detailed protocols governing the engagement of Tavrenis Stern are set forth in Section VI of this memorandum.
Whitfield Bauer & Associates LLP (1330 Connecticut Avenue NW, Suite 500, Washington, DC 20036). Whitfield Bauer is an FDA regulatory specialist law firm anticipated to be engaged as co-counsel, with Penterra's consent, to provide regulatory expertise in connection with the OPDP Inquiry and the preparation of Penterra's formal FDA response. Detailed protocols governing the anticipated engagement of Whitfield Bauer are set forth in Section VII of this memorandum.
IV. DOCUMENT-HANDLING PROCEDURES
Proper handling of documents is essential to the preservation of privilege and work-product protection. This section sets forth the mandatory procedures for marking, labeling, storing, and transmitting all documents generated or received in connection with this engagement.
A. Privileged Document Marking and Labeling
All memoranda, draft analyses, legal research memoranda, investigation notes, interview memoranda, correspondence, and other communications prepared by or at the direction of the Calderwood & Harkness engagement team in connection with this matter must bear the following privilege legend, prominently displayed at the top of the first page and, where practicable, in the header or footer of each subsequent page:
PRIVILEGED AND CONFIDENTIAL — ATTORNEY-CLIENT COMMUNICATION AND/OR ATTORNEY WORK PRODUCT — PREPARED AT THE DIRECTION OF COUNSEL IN ANTICIPATION OF LITIGATION
In addition, all documents must be marked with the matter number 1018-00002 to ensure proper identification, tracking, and filing within Calderwood & Harkness's document management system.
For electronic documents, including word-processing files, spreadsheets, presentations, and PDF files, the privilege legend should be included in the header or footer of the document. Where the document format does not support headers or footers (e.g., certain data files or images), the legend should be included in the file name or in an accompanying cover memorandum.
For email communications, the subject line of every email relating to this matter should begin with the following prefix:
PRIVILEGED — Matter 1018-00002:
This prefix should be followed by a brief description of the subject of the email. In addition, the body of each email should include the privilege legend either at the top of the message or in the email signature block or confidentiality footer.
All draft documents — including draft memoranda, draft response letters, draft analyses, and draft presentations — must be clearly labeled as "DRAFT — PRIVILEGED" to avoid any risk of inadvertent production or confusion between preliminary work product and final, non-privileged documents. Draft documents should never be circulated without this designation, and final versions of documents intended for submission to third parties (such as the FDA) should be clearly distinguished from privileged drafts by removing the "DRAFT" designation only upon finalization and approval by the Responsible Partner.
B. Document Storage and Access Controls
All electronic files relating to this matter must be stored on Calderwood & Harkness LLP's secure document management system ("DMS") in a dedicated matter-specific workspace designated for Matter 1018-00002. No matter-related files are to be stored in any location outside the DMS, including but not limited to:
• Personal desktop or laptop computers (whether firm-issued or personal devices);
• Personal email accounts (including but not limited to Northgate Software, Cascade Health IT, Ridgeline Technologies, or any other personal or non-firm email service);
• Personal or unsecured cloud storage services (including but not limited to Larkspur Technologies, Hollowell Health IT, Meridian Systems, or Cobalt Ridge Systems personal accounts);
• USB drives, external hard drives, or other removable media, unless specifically authorized by the Responsible Partner for a discrete, documented purpose.
Access to the Matter 1018-00002 workspace on the DMS is restricted to the four members of the engagement team (Leonard Cross, Nathaniel Bower, Jeffrey Park, and Audrey Zhou) and any additional personnel specifically authorized by Leonard Cross. Access permissions will be managed by Calderwood & Harkness's IT department at the direction of the Responsible Partner. Any requests for access by persons not currently on the engagement team must be submitted to Jeffrey Park, who will coordinate approval with Leonard Cross before any access is granted.
Physical documents relating to this matter, to the extent any are generated or received, must be maintained in a locked file cabinet located in the Responsible Partner's office suite or in a secured file room. Physical files are subject to sign-out protocols; any team member removing a physical file from the secured location must log the date, time, and purpose of the removal and return the file promptly upon completion of the intended use. Physical files must not be left unattended in common areas, conference rooms, or other unsecured locations.
C. Email and Electronic Communication Protocols
All privileged communications with Penterra personnel must be sent from Calderwood & Harkness LLP firm email addresses to the authorized client contacts identified in Section III.B above. Communications should be addressed only to authorized recipients; the use of broad distribution lists that include non-authorized persons is prohibited. When responding to or forwarding email chains, team members must verify that all recipients on the chain are authorized persons before sending.
The use of personal email accounts by any Calderwood & Harkness attorney or staff member for any matter-related communication is strictly prohibited. Similarly, Penterra's authorized client contacts should be instructed that all communications with Calderwood & Harkness relating to this engagement must be conducted through Penterra's corporate email system, and the use of personal email accounts for such communications is prohibited.
Penterra's authorized contacts should be further instructed to refrain from forwarding privileged communications received from Calderwood & Harkness to any individual who is not an Authorized Client Contact, whether within or outside of Penterra. The forwarding of a privileged communication to an unauthorized person may result in waiver of the privilege with respect to that communication. If a Penterra authorized contact believes that a particular communication needs to be shared with a non-authorized person, the contact should first consult with Margaret Tan and Jeffrey Park to determine whether such sharing can be accomplished without jeopardizing the privilege.
Where a communication contains both privileged legal analysis and non-privileged business content, team members should, where practicable, separate the privileged and non-privileged content into distinct communications. For example, counsel's legal assessment of a promotional claim should be communicated in a separate email from the transmission of the underlying business record (such as the promotional material itself). If separation is not practicable under the circumstances, the communication should be clearly marked as privileged in accordance with the legend requirements described above, and the portions of the communication containing legal advice or work product should be clearly identified. This practice reduces the risk that a court will find the entire communication non-privileged based on the inclusion of non-privileged business content.
D. Voicemail and Verbal Communications
Telephone calls and videoconferences with Penterra personnel or other authorized persons regarding substantive aspects of this matter should be documented in brief memoranda-to-file prepared by the Calderwood & Harkness attorney who participated in the call. These memoranda should be prepared promptly after the call, marked as privileged work product, and filed in the DMS workspace for Matter 1018-00002. The memoranda need not be verbatim transcripts; they should capture the key topics discussed, the advice provided, and any action items, in sufficient detail to support the firm's privilege log and to document the legal-advice nature of the communication.
When leaving voicemail messages for Penterra personnel or other authorized persons, team members should avoid including any substantive legal advice, strategic analysis, or opinion work product in the voicemail. Voicemail messages should be limited to scheduling, logistics, and general requests to return a call. This precaution is necessary because voicemail recordings may be stored on systems that are not subject to privilege protections and may be accessible to unauthorized persons.
The same caution applies to text messages. Team members should not use text messaging (including SMS, Westmark Software, or messaging features within any application) for substantive legal communications relating to this matter. Text messages may be used only for scheduling or logistical purposes, and even those messages should not reference the substance of the engagement or include any privileged information.
V. COMMUNICATION GUIDELINES WITH PENTERRA PERSONNEL
A. Interviews of Penterra Employees
As part of the internal investigation of Zelvara® promotional practices, Calderwood & Harkness will conduct interviews of Penterra employees who have knowledge of the development, review, approval, and dissemination of the three promotional materials at issue in the OPDP Inquiry. These interviews are a critical component of the investigation and must be conducted in a manner that preserves the attorney-client privilege and work-product protection.
The key interviewees anticipated at this stage of the investigation include the following:
• Derek Foss, Vice President, Commercial Operations & Marketing — regarding the Clarity Campaign strategy, vendor management, and sales-force oversight;
• Alan Renwick, Director, Promotional Review Committee — regarding PRC review processes, meeting deliberations, and the approval history of the three materials;
• Dr. Lina Gerhardt, Pharm.D., Senior Director, Medical Affairs — regarding the medical-affairs review of promotional claims and the scientific support for the claims at issue;
• Selected Sales Representatives from the 14 identified Northeast-region representatives who distributed detail aid ZVR-2023-DA-007 — regarding the manner of use, distribution, and any off-label or supplemental communications that may have accompanied the detail aid in the field.
Additional interviewees may be identified as the investigation progresses; any such additions should be approved in advance by Margaret Tan and coordinated by Jeffrey Park.
Each interview must begin with a clear and comprehensive Upjohn warning (sometimes referred to as a "corporate Miranda" warning), advising the employee of the following:
(1) Calderwood & Harkness LLP represents Penterra Pharmaceuticals Corp. as a corporate entity. The firm does not represent the individual employee, and the interview does not create an attorney-client relationship between the firm and the employee.
(2) The purpose of the interview is to obtain information to enable Calderwood & Harkness to provide legal advice to Penterra in connection with the OPDP Inquiry.
(3) The interview and the communications made during the interview are protected by Penterra's attorney-client privilege.
(4) The attorney-client privilege belongs to Penterra Pharmaceuticals Corp. — not to the individual employee. Penterra, acting through its General Counsel, may in its discretion choose to waive the privilege and disclose the substance of the interview to third parties, including government agencies.
(5) The employee should keep the substance of the interview confidential and should not discuss the content of the interview with colleagues, subordinates, or any other persons, as doing so could jeopardize the company's privilege.
A written acknowledgment of the Upjohn warning should be obtained from each interviewee at the commencement of the interview. The acknowledgment form should be signed and dated by the employee and the interviewing attorney, and a copy should be maintained in the privilege file for Matter 1018-00002. Jeffrey Park will prepare a standard Upjohn acknowledgment form for use in all interviews.
Interview notes taken by the Calderwood & Harkness attorney during the interview, as well as any memoranda summarizing the interview prepared after its conclusion, constitute attorney work product and must be marked accordingly. Raw interview notes should not be shared with the interviewee, other Penterra personnel, or any person outside the engagement team. If a Penterra authorized contact requests information about the content of an interview, such information should be communicated only through counsel and only to the extent consistent with the preservation of privilege and work-product protection.
B. Requests for Business Records
The internal investigation will require Calderwood & Harkness to review a substantial volume of Penterra's business records, including but not limited to:
• PRC meeting minutes for the period January through October 2023;
• The Clarity Campaign statement of work ("SOW") dated January 9, 2023, between Penterra and Ridgeline Health Analytics LLC;
• The master services agreement ("MSA") between Penterra and Ridgeline Health Analytics LLC, dated March 15, 2021;
• CRM call notes and activity reports for the 14 identified Northeast-region sales representatives;
• The three promotional materials at issue (ZVR-2023-BNR-044, ZVR-2023-EML-019, and ZVR-2023-DA-007);
• Internal communications (emails, memoranda) relating to the development and approval of the three materials;
• Medical-affairs review files for the Zelvara® product line;
• Sales training materials and field guidance documents relating to Zelvara® promotion.
All requests for business records should be routed through Margaret Tan or Christine Holloway. Direct requests to other Penterra personnel for business records should not be made without the advance coordination and approval of one of these two authorized contacts. This routing ensures that the Client's internal privilege protections are maintained and that document-collection efforts are properly documented.
It is essential to understand that business records provided by Penterra to Calderwood & Harkness are not themselves privileged merely by virtue of being transmitted to counsel. PRC meeting minutes, CRM call notes, promotional materials, and vendor contracts are business records created in the ordinary course of Penterra's operations, and they remain discoverable in any litigation or regulatory proceeding regardless of whether they have been shared with counsel. However, the selection, compilation, and organization of such records at counsel's direction may be protected as work product to the extent that the selection reflects counsel's mental impressions, legal theories, or litigation strategy. This so-called "selection and compilation" privilege, recognized by many courts, must be carefully maintained.
To preserve the distinction between underlying business records and counsel's privileged analysis, team members must adhere to the following rule: annotations, comments, legal analysis, and strategic assessments relating to business records must be made on separate work-product documents — not on the face of the business records themselves. Do not write notes, highlight passages, or add comments directly on copies of PRC minutes, promotional materials, CRM records, or any other business record. Instead, prepare a separate memorandum or analysis document that references the business record by its identification number or description and sets forth counsel's analysis. This practice ensures that if the underlying business record is produced in discovery or to a government agency, counsel's analysis is not inadvertently disclosed along with it.
C. Communications with Penterra's Board and Senior Management
If the OPDP Inquiry or the internal investigation reaches a stage where briefing of Penterra's board of directors or executive leadership beyond the designated Authorized Client Contacts is warranted — for example, if the matter escalates to a Warning Letter, a DOJ or OIG referral, or material securities-disclosure issues — such briefings must be carefully structured to preserve the attorney-client privilege.
All communications with the board or senior management regarding this matter should be coordinated with Margaret Tan. Board presentations and executive briefings should be:
• Conducted in executive session, with attendance limited to board members, the General Counsel, and outside counsel;
• Documented as privileged board materials, clearly marked with the privilege legend;
• Limited in attendance to persons with a need to receive legal advice; non-essential attendees (such as business-unit leaders not directly involved in the matter) should not be included unless their participation is necessary for the provision or receipt of legal advice;
• Structured to ensure that the purpose of the briefing is the provision of legal advice, not the mere reporting of business information; the framing of the briefing should emphasize the legal context, the legal risks, and the legal recommendations being presented.
Minutes of board sessions at which privileged legal briefings occur should be carefully drafted to reflect the privileged nature of the discussion without recording the substance of the legal advice in detail. Margaret Tan should coordinate with Penterra's corporate secretary on the appropriate form and content of such minutes.
VI. PROTOCOLS FOR ENGAGEMENT OF TAVRENIS STERN CONSULTING GROUP LLC
A. Engagement Structure — "At the Direction of Counsel"
Calderwood & Harkness intends to engage Tavrenis Stern Consulting Group LLC ("Tavrenis Stern"), located at 311 South Wacker Drive, Suite 2400, Chicago, Illinois 60606, to perform e-discovery and forensic review services in connection with the internal investigation. Specifically, Tavrenis Stern will be tasked with the collection, processing, and hosting of electronic data from the communications systems and CRM platforms used by the 14 identified Northeast-region sales representatives who distributed detail aid ZVR-2023-DA-007. The data to be collected includes CRM entries, corporate email, text messages, and any other electronically stored information relevant to the promotional practices at issue.
The fixed fee for Tavrenis Stern's engagement is $87,500, covering data collection, processing, and review platform hosting. The Engagement Lead for Tavrenis Stern is Patricia Okoro. The engagement fee and scope of work will be set forth in a formal engagement letter between Calderwood & Harkness LLP (as engaging party) and Tavrenis Stern.
To maximize the applicability of work-product protection and the consultant extension of the attorney-client privilege, the engagement of Tavrenis Stern must be structured so that Tavrenis Stern acts at the direction and under the supervision of Calderwood & Harkness LLP — not as an independent contractor of Penterra. Under the Kovel doctrine, see United States v. Kovel, 296 F.2d 918 (2d Cir. 1961), and the "functional equivalent" analysis adopted by several courts, communications between counsel and a consultant retained to assist counsel in providing legal advice to a client may be protected by the attorney-client privilege and the work-product doctrine, provided that the consultant's role is integral to the attorney's ability to render legal advice and that the consultant is operating under counsel's direction and control. This protection extends to e-discovery consultants retained by counsel to collect, process, and analyze electronically stored information in anticipation of litigation.
The engagement letter with Tavrenis Stern must include the following provisions to support the privilege and work-product claims:
(a) Tavrenis Stern is retained by Calderwood & Harkness LLP to assist counsel in providing legal advice to Penterra Pharmaceuticals Corp. in connection with the OPDP Inquiry and the internal investigation.
(b) All work product generated by Tavrenis Stern in the course of the engagement, including data-collection reports, processing logs, culling protocols, search-term analyses, and analytical summaries, is confidential and subject to the attorney-client privilege and work-product protection.
(c) Tavrenis Stern will not disclose any information, documents, data, or work product relating to this engagement to any third party without the prior written consent of Calderwood & Harkness LLP.
(d) Tavrenis Stern will not communicate directly with Penterra personnel regarding the substance of the engagement without the prior authorization of Jeffrey Park or Leonard Cross.
B. Data Handling by Tavrenis Stern
All data collected by Tavrenis Stern — including CRM records, emails, text messages, and any other electronically stored information — must be hosted on Tavrenis Stern's secure, access-controlled review platform. Access to the review platform must be restricted to the members of the Calderwood & Harkness engagement team (Leonard Cross, Nathaniel Bower, Jeffrey Park, and Audrey Zhou), and to Tavrenis Stern personnel who have been specifically designated by Patricia Okoro and approved by Jeffrey Park.
Tavrenis Stern personnel must not provide data, reports, analyses, or findings of any kind directly to Penterra personnel. All reports, deliverables, and communications from Tavrenis Stern relating to this engagement must flow through Calderwood & Harkness. If Penterra's authorized contacts require access to specific data or information collected by Tavrenis Stern, such access will be arranged by Calderwood & Harkness in a manner that preserves the applicable privilege and work-product protections.
Tavrenis Stern's analytical reports, data-culling protocols, search-term specifications, technology-assisted review ("TAR") methodology documentation, and any other materials reflecting the analytical judgments and decisions made in the course of the e-discovery process constitute attorney work product and must be marked with the privilege legend and the matter number. These materials reflect the litigation strategy and legal theories of counsel, as the selection of search terms, custodians, date ranges, and data sources is informed by and reflects counsel's assessment of the legal issues in the OPDP Inquiry.
C. Confidentiality and Non-Disclosure
Before receiving any data, documents, or information relating to this engagement, Tavrenis Stern must execute a confidentiality and non-disclosure agreement ("NDA") specific to this engagement. The NDA must:
• Reference Matter No. 1018-00002;
• Prohibit the disclosure of any information relating to the OPDP Inquiry, Penterra's internal investigation, or the existence of the engagement itself to any person or entity not authorized under the NDA;
• Require Tavrenis Stern to implement and maintain appropriate physical, technical, and administrative safeguards to protect the confidentiality and security of all data and materials received;
• Require prompt notification to Calderwood & Harkness in the event of any actual or suspected breach of confidentiality or unauthorized access to engagement data;
• Provide for the return or secure destruction of all engagement data and materials upon the conclusion of Tavrenis Stern's services, at Calderwood & Harkness's direction.
Jeffrey Park is responsible for coordinating the execution of the NDA with Patricia Okoro prior to the commencement of any data-collection activities.
VII. PROTOCOLS FOR CO-COUNSEL ENGAGEMENT (WHITFIELD BAUER & ASSOCIATES LLP)
A. Anticipated Engagement
Calderwood & Harkness anticipates engaging Whitfield Bauer & Associates LLP ("Whitfield Bauer"), located at 1330 Connecticut Avenue NW, Suite 500, Washington, DC 20036, as FDA regulatory specialist co-counsel in this matter. Whitfield Bauer's engagement is anticipated to provide deep regulatory expertise in connection with the OPDP Inquiry, including analysis of the OPDP's substantive concerns, the preparation and review of Penterra's formal response to the agency, and guidance on the regulatory framework governing prescription drug promotion under the Federal Food, Drug, and Cosmetic Act and FDA's implementing regulations and guidance documents.
The anticipated lead personnel at Whitfield Bauer are:
• Dr. Hannah Whitfield, J.D., Ph.D. — Lead Partner; hourly rate of $950 per hour.
• Thomas Crane — Senior Associate; hourly rate of $625 per hour.
The engagement of Whitfield Bauer is subject to Penterra's consent, as provided in the engagement letter dated October 30, 2023. Jeffrey Park will coordinate with Margaret Tan to obtain the Client's formal consent before the engagement is finalized.
B. Common-Interest Agreement
Upon the formal engagement of Whitfield Bauer, a written common-interest agreement (sometimes referred to as a joint-defense agreement) should be executed among Calderwood & Harkness LLP, Whitfield Bauer & Associates LLP, and Penterra Pharmaceuticals Corp. The purpose of this agreement is to confirm that communications among the parties relating to the OPDP Inquiry are made in furtherance of a common legal interest — specifically, the defense of Penterra's interests in connection with the OPDP Inquiry and any related enforcement proceedings — and are therefore protected by the attorney-client privilege and the work-product doctrine.
The common-interest agreement should include, at a minimum, the following provisions:
• A recital of the common legal interest shared by the parties, specifically the defense and resolution of the OPDP Inquiry and any related proceedings;
• A statement that all communications among the parties made in furtherance of the common legal interest are intended to be and shall remain privileged and confidential;
• A provision that no party may unilaterally waive the privilege applicable to shared communications without the prior written consent of all other parties to the agreement;
• A provision that the agreement does not create an attorney-client relationship between Whitfield Bauer and any person other than Penterra (if Whitfield Bauer is retained directly by Penterra as co-counsel, or if Whitfield Bauer is retained by Calderwood & Harkness to assist in the provision of legal advice to Penterra);
• A provision specifying the permissible scope of information sharing and any limitations or exclusions;
• A provision addressing the procedures for handling disputes regarding privilege or waiver among the parties.
Jeffrey Park will prepare a draft common-interest agreement for review by Leonard Cross and Margaret Tan.
C. Information-Sharing Protocols
Privileged materials shared with Whitfield Bauer in the course of the co-counsel engagement must be transmitted through secure channels. Specifically:
• Electronic transmissions must be made via encrypted email or through a secure file-sharing platform approved by Calderwood & Harkness's IT department. Unencrypted email should not be used for the transmission of privileged materials to or from Whitfield Bauer.
• All documents shared with Whitfield Bauer must bear the privilege legend specified in Section IV.A and the matter number 1018-00002.
• Whitfield Bauer's own work product relating to this matter — including regulatory analyses, draft FDA submissions, research memoranda, and strategic assessments — should be similarly marked with the privilege legend and shared only with the Calderwood & Harkness engagement team and authorized Penterra contacts.
• Whitfield Bauer should be instructed to maintain all shared materials in a secure, access-controlled environment and to limit access to personnel at Whitfield Bauer who are assigned to this engagement.
Any questions regarding the scope of permissible information sharing with Whitfield Bauer should be directed to Jeffrey Park or Leonard Cross.
VIII. SEGREGATION OF PRIVILEGED MATERIALS FROM BUSINESS RECORDS
A. General Principle
Privileged communications and attorney work product must be maintained separately from Penterra's ordinary business records at all times. The commingling of privileged materials with non-privileged business records creates a significant risk that privileged materials will be inadvertently produced in response to discovery requests, government subpoenas, or regulatory inquiries, potentially resulting in waiver of the privilege.
The risk of commingling is particularly acute in this matter for several reasons:
(a) PRC Meeting Minutes and Promotional Materials. PRC meeting minutes and the promotional materials themselves are business records that are generated in the ordinary course of Penterra's operations and are not privileged. These records are likely to be requested by the FDA, and potentially by DOJ or OIG, in connection with the OPDP Inquiry or any downstream enforcement action. If counsel's legal analyses, strategic assessments, or privileged communications are filed alongside or within these business records, they may be inadvertently disclosed.
(b) CRM Data. The internal investigation will involve extensive review of CRM data generated by Penterra's sales representatives in the ordinary course of their promotional activities. CRM data is a business record. Counsel's analysis of CRM data, and the selection and compilation of CRM records for investigative purposes, must be maintained separately from the underlying data.
(c) Corrective-Action Plans and Revised SOPs. The engagement includes advising Penterra on corrective actions, which may include revised PRC standard operating procedures, updated training protocols, and modified promotional-review workflows. Once these corrective measures are implemented, the final, operative versions of the documents become business records. However, drafts of these documents that reflect counsel's input, recommendations, and legal analysis remain privileged work product. The transition from privileged draft to non-privileged business record must be carefully managed.
B. Specific Segregation Procedures
To maintain the integrity of the privilege and work-product protections, the following segregation procedures must be followed:
Calderwood & Harkness Materials. All legal analyses, interview notes, investigation memoranda, draft FDA response letters, strategic assessments, and other privileged work product generated by the Calderwood & Harkness engagement team must be stored exclusively in the DMS workspace for Matter 1018-00002. These materials must not be filed or stored alongside Penterra's PRC records, promotional material archives, regulatory submission files, or any other category of business records, whether in electronic or physical form.
Corrective-Action Documents. If Penterra implements corrective actions based on counsel's recommendations — such as revised PRC SOPs, retraining programs, or enhanced promotional-review checklists — the final implemented versions of those documents will become business records that are maintained in Penterra's ordinary file systems. However, all prior drafts of such documents that reflect counsel's input, markup, comments, or recommendations must be maintained in the privilege file and must not be filed alongside the final implemented version. The transition point should be clearly documented: when a corrective-action document is finalized and adopted by Penterra for business implementation, it should be re-created as a clean document without counsel's markup, and the clean version should be stored in Penterra's business files while the drafts remain in the privilege file.
Penterra Internal Segregation. Christine Holloway and Alan Renwick should be advised by Margaret Tan — and Calderwood & Harkness should reinforce this instruction in its communications with them — that all privileged materials received from Calderwood & Harkness must be segregated from their departmental files and stored in a separate electronic folder or physical directory designated exclusively for outside-counsel communications relating to the OPDP Inquiry. These materials should not be saved in shared departmental drives, team collaboration platforms, or other locations accessible to non-authorized personnel.
Centralized Privilege Repository. Margaret Tan should designate a single, secure repository within Penterra's legal department for all privileged materials relating to the OPDP Inquiry. This repository should be access-controlled and limited to the Authorized Client Contacts designated in Section III.B. The repository should include all communications from Calderwood & Harkness, all privileged board materials, and any other documents generated in connection with the legal aspects of the OPDP Inquiry.
C. Privilege Log Maintenance
Calderwood & Harkness will maintain a running privilege log documenting all documents and communications withheld from disclosure on the basis of attorney-client privilege, work-product protection, or both. The privilege log is an essential tool for defending privilege assertions in the event of a discovery dispute, government request, or judicial challenge.
The privilege log should include the following information for each entry:
• Date: The date of the document or communication;
• Author: The person who created the document or initiated the communication;
• Recipient(s): The person(s) to whom the document or communication was directed;
• Document Type: A description of the type of document (e.g., memorandum, email, interview notes, draft response letter);
• Subject Matter: A general description of the subject matter of the document, stated in terms sufficient to allow evaluation of the privilege claim without revealing the privileged content;
• Basis for Privilege Assertion: The specific privilege or protection asserted (attorney-client privilege, work product — ordinary, work product — opinion, or a combination thereof).
The privilege log should be updated on a rolling basis throughout the engagement. Jeffrey Park is responsible for the ongoing maintenance of the privilege log, with support from Audrey Zhou. Upon matter closure, a final, comprehensive privilege log will be prepared and maintained as part of the permanent matter file.
IX. INADVERTENT DISCLOSURE PROCEDURES
A. Clawback Protocol
Despite the most diligent precautions, the possibility of inadvertent disclosure of privileged materials to a third party can never be entirely eliminated. In the event that privileged materials are inadvertently disclosed to any third party — including but not limited to the FDA, DOJ, OIG, any court, opposing counsel in any related proceeding, or any other person or entity not authorized to receive such materials — the following clawback protocol must be followed immediately:
1. Immediate Notification. The person who discovers or becomes aware of the inadvertent disclosure must immediately notify Leonard Cross (Responsible Partner) and Jeffrey Park (Lead Associate). Notification should be made by telephone if possible, followed by a confirming email marked as privileged.