Ethics

Compliance News in Review, February 23, 2016

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Did you feel the awakening? It was as if a million voices cried out in joy, then were suddenly, silently going about their business again. Geekerati rejoice! The Star Wars: Episode VII video announcing the beginning of production on the next installment has been released. December 15, 2017 can’t get here fast enough! We’ll have to wait to learn about what happens in that galaxy far, far away, but in the meantime, we can at least keep up with the recent news from the compliance universe, with this edition of the Compliance News in Review.

Do you have questions about this year’s Open Payments submission? There’s no need to seek answers using the Force while CMS is around. The agency held a webinar to discuss this year’s submission and take questions from stakeholders. CMS presented an overview of enhancements to the system and the timeline for submissions before taking questions. Those questions focused on reporting requirements, the dispute process, and the deletion of records.

UK government officials are launching an “urgent investigation” (hopefully not urgent enough to break out the mind probe) into the possibility that National Health Service (NHS) officials received consulting payments from pharmaceutical companies. The investigation is based on a report by the Telegraph that more than 130 NHS officials, most in positions to assess what medications would be used by patients, were receiving the payments. The payments were allegedly provided to the NHS workers in return for serving on advisory boards. Activities related to the advisory boards ranged from participation in teleconferences to travel to meetings outside the UK, where the participants stayed at luxury hotels.

Negotiations in the Amarin case are moving slower than a space slug. The FDA and Amarin have requested a third extension in the process as they look to reach a settlement in the case involving the off-label promotion of Amarin’s omega-3 drug. The extension will delay the court proceedings until March 18.

Pfizer has reached an agreement in principle with the federal government in a False Claims Act case involving the calculation of Medicaid rebates for the drug Protonix. The product was marketed by Pfizer’s Wyeth unit. The company will pay $784.6 million to resolve the charges, and will not admit any liability in the case.

The Jedi Master of the Serious Fraud Office (SFO) will remain in his post a bit longer than planned. The UK’s Attorney General extended the contract of SFO head, David Green, for two years. Green’s contract was set to expire in April, and now will expire in April of 2018.

France could be joining the Alliance of countries beefing up their anti-corruption laws. Draft legislation of an anti-corruption law will be presented to the French State Council for validation, and will then move on to the legislative process. The French Parliament is expected to begin its review in April of this year. Highlights of the draft include the creation of anti-corruption agency with the power to impose sanctions; a requirement mandating corporations have a compliance function in place; and the implementation of a number of Sunshine requirements, most notably the disclosure of payments to lobbyists.

Anticorruption efforts by government agencies have certainly been a hot topic of late. From the announcement that the FBI would be hiring additional FCPA investigatory staff, to the SciClone settlement, and the news of a new law on the horizon in France, governments around the world are taking steps to root out bribery and corruption. That’s why now is as good a time as any to review your company’s current anticorruption program, including the training that addresses anticorruption laws. For multinational companies, training on the FCPA alone is not enough. The UK Bribery Act is just as far reaching, and your colleagues need to understand the differences in the two laws. In addition, both Mexico and Brazil have implemented tougher anticorruption laws in the last several years, and training should be provided on those as well.

Thanks for reading everyone, and may the Force be with your compliance training efforts.

Compliance News in Review, February 1, 2016

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It’s Super Bowl week! Another season of ups, downs, highlights, lowlights, hope, and unfulfilled expectations for fans around the country (except for those lucky enough to root for the winning squad) is about to end. Now we’re left to fill a long seven month void until training camp begins anew and hope springs eternal (we know, we’ve mixed our sporting metaphors). Whether you’re pulling for the Broncos or the Panthers, or just a strong lineup of new commercials (spoiler alert), the day is bound to deliver cheers, groans, and snacks aplenty. Before you dive into the game preparations, we offer a playbook of our own, with this edition of the Compliance News in Review.

We kickoff this edition with news from the expanding world of federal oversight. The DOJ announced that it is adding some muscle to the huddle, and bolstering its anti-corruption resources, by hiring ten new prosecutors for its FCPA unit.

It’s time for a regulatory end zone dance in Kentucky. State Attorney General, Jack Conway, has entered into settlements with Endo and Johnson & Johnson over accusations related to the companies’ marketing practices. The state settled with Endo for $24 million over its marketing of OxyContin. The suit accuses the company of positioning the drug as “non-addictive” and encouraging reps to tell doctors it was less likely to be abused than other opioid drugs. The settlement will be used to fund addiction treatment programs. The state settled with Johnson & Johnson for $15.5 million over the marketing of Risperdal for unapproved uses.

The physician leading the charge for a Sunshine Act in Scotland says the public consultation on his petition to Parliament is “unbalanced.” Dr. Gordon, a former National Health Service psychiatrist, says that Parliament is not presenting full information about the current status of the disclosure of payments from life sciences companies to NHS workers. He says information being presented to the public implies that current disclosure rules may be working and sufficient. The doctor claims the evidence presented in his petition shows that payments are escaping current disclosure requirements. Twelve public discussion groups have been held to discuss the matter and more will be scheduled.

The news on the Final Rule is finally off the bench! At long last, the Average Manufacturer Price (AMP) Final Rule has been released. Included in the new rule is language now excluding sales to 340B covered entities from AMP and Best Price (BP); and revised language regarding the exclusion of patient coupons, vouchers and free goods from AMP and BP. In other news from CMS, the Open Payments system is now ready to begin accepting registration, recertification of registration, and data submissions from applicable manufacturers and GPOs. Data submissions for the 2015 calendar year are due March 31st.

Has the ruling on off-label promotion been reversed upon further review? In proposed jury instructions at the trial of a medical device company and its chief executive, the DOJ indicated that it is “not a crime for a device company or its representatives to give doctors wholly truthful and non-misleading information about the unapproved use of a device.” Does this change the off-label playing field?

Before choreographing an end zone dance of our own over the last bit of news, we have to think about what it really means and whether anything really changes. For trainers, probably not. Even if the government is ever so slightly agreeing that truthful off-label speech is lawful, the fact remains, untruthful off-label speech is illegal. Therefore, now is not the time to abandon or diminish on-label training. Your training must still cover the illegal nature of off-label speech, and the proper handling of off-label inquiries. The importance of vetting promotional statements before they are shared with HCPs or the public must still be stressed.

Well, that’s a wrap for this edition of the Compliance News in Review. If you have a side in the big game, good luck!

The 2015 Compliance Year in Review (and Look Forward to the Rest of 2016)

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The start of 2016 may be filled with hope for good compliance-related news to come, but before we travel too far forward with our prognostications, let’s take a look back at some of the stories that really struck a chord in 2015. Charge up your flux capacitor everyone, as we travel back a few weeks and months, with this edition of the Compliance News in Review: the Yearly Edition.

In 2015, a full year’s worth of data was submitted to the Open Payments program. Considering the rejection of massive amounts of 2014 data, as well as the registration issues and delays that plagued the first Open Payments data submission period, system users certainly had cause to be concerned about the 2015 period. Happily, CMS made improvements, and the process, while not problem free, was smoother in 2015. The agency improved its validated physician list for manufacturers and its data matching processes, which resulted in fewer records being rejected. The improvements in the registration process seemed to help manufacturers, but did little to improve the physician experience.

CMS announced additional improvements that will hopefully improve users’ experience in 2016, including the removal of limitations around entering special characters in text fields, and improving users’ downloading capabilities.

The life sciences industry certainly pushed the free speech issue with the FDA in 2015. Two companies filed suits against the agency, arguing that they had the right to truthfully promote drugs for off-label uses. In the Amarin suit, the court granted an injunction, and the company is free to promote the drug for use in a wider patient population than the drug was originally approved.

On the heels of that case, Pacira filed suit over the FDA’s insistence that the company was promoting a pain killer for post-surgery pain, an unapproved use.  After the company received a warning letter, stating that drug was only approved for use following a specific type of surgery, Pacira argued that the FDA was illegally trying to narrow the approved use. The company also argued that even if it was promoting the drug for an off-label purpose, it had the right to do so, as long as it was sharing truthful information. The FDA quietly removed the warning letter from its website and eventually settled the case.

After years of chatter, but very little visible action, the Serious Fraud Office entered into its first deferred prosecution agreement with a corporate entity, over violations of the U.K. Bribery Act. Standard Bank was accused of failing to prevent bribery by an allied person. The DPA remains in effect for three years and requires the bank to pay $32.6 million; submit to a review of its anti-bribery policies by an independent reviewer and make any changes recommended by the reviewer; and cooperate with authorities in any other matters that arise from the indictment.

The year was devoid of multi-billion dollar settlements in the industry, but 2015 did see the largest settlement by the OIG under its civil monetary penalty authority. The OIG settled with Sandoz for $12.64 million over allegations the company submitted inaccurate ASP data to the Medicare program. The agency alleged that the company submitted inaccurate data between 2010 and 2012, which “undermined the integrity of the Medicare Part B drug pricing system.”

Any worthwhile year-end retrospective needs to include a look forward. So here are the issues that we think will be hot topics in 2016:

  1. Drug pricing transparency. In 2015, several states proposed laws that would require companies to disclose costs for drugs that run in the thousands of dollars per-dose or course of treatment. This push isn’t likely to go away, considering recent dramatic drug price hikes by companies like Valeant and Turing, which resulted in inquiries by lawmakers in the latter part of the year.
  2. Transparency in Europe. Staying on the transparency theme, we expect physician spend reporting in Europe to be a prominent news story toward the middle of the year. The first round of reporting under the EFPIA Transparency Code is due then, and the first round is sure to be thoroughly dissected and analyzed.
  3. Individual accountability. In September of 2015, the Department of Justice released a memo from Deputy Attorney General Sally Quillian Yates saying the agency plans to focus on holding individuals accountable in cases of corporate crime. Not exactly earth shattering news, but the DOJ has put it in writing, so they must really, really mean it. Whether the agency brings a case against an individual in 2016 or not, the policy is sure to be widely discussed by federal prosecutors and other agency representatives at conferences throughout the year.

Have a great 2016 everyone! We’ll see you at CBI’s Pharmaceutical Compliance Congress January 26 and 27.

Compliance News in Review, December 10, 2015

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One of the great traditions of the Christmas season is the performance of Tchaikovsky’s The Nutcracker by ballet companies and dance schools around the world. Whether performed by professionals or students, the ballet is full of magic and fantasy. A young girl, Clara (or Marie, depending on the production), receives a nutcracker, which comes to life, fights an army of giant rats, and then whisks Clara away to land of sweets ruled over by the Sugarplum Fairy. Almost as delightful as the prospects of watching giant rodents fight on stage is what’s been happening in the world of life science compliance. Places everyone! Time for the Compliance News in Review.

Standard Bank is taking a bow as the first company to enter into a deferred prosecution agreement (DPA) with the Serious Fraud Office over violations of the U.K. Bribery Act. The company was accused of failing to prevent bribery by an allied person. The DPA remains in effect for three years and requires the bank to pay $32.6 million; submit to a review of its anti-bribery policies by an independent reviewer and make any changes recommended by the reviewer; and cooperate with authorities in any other matters that arise from the indictment.

It’s not a dream Clara, the DOJ announced it has recovered $3.5 billion in False Claims Act cases in 2015. As in years past, healthcare fraud represented the lion’s share of the recoveries. In 2015, healthcare fraud cases totaled nearly $2 billion. Cases against the pharma industry represented $96 million of that total. It was a good year for qui tam relators as well. Of the $2.8 billion recovered from qui tam cases, a record $1.1 billion came from cases in which the U.S. chose not to intervene.

Harvard Medical School has made a slight change to its conflict of interest policy. The school is relaxing a policy that prohibited faculty from accepting equipment or other support from a private company in which they have equity, or from a public company in which they hold equity of $30,000 or more. The school will now allow faculty conducting basic research to petition for an exclusion from the rule if they can show that the benefits of the research outweigh any potential conflict of interest. Faculty would also need to show they have measures in place to guard against conflicts of interest.

Physicians may need Uncle Drosselmeyer to come guide them through the Sunshine Act sine a new study shows professional medical organizations aren’t doing so. The study appeared in the journal, Postgraduate Medicine. Researchers reviewed 59 articles and found there was very little guidance regarding the Act, and professional associations tended to focus on sharing broad information about reporting requirements. Rarely was there information regarding payments for research grants, trial participating and medical publication. The authors conclude that expert guidance about the Final Rule itself is needed, and suggest a lack of guidance may impact physician investigators’ participation in clinical trials and publishing results.

Clara’s trip to the land of sweets may have all been a dream conjured up by the mysterious Drosselmeyer, but after years of anticipation, the SFO is making its promise of dealing with corporate bribery a reality. In addition to the Standard Bank DPA, another corporation was recently charged by the SFO with violating the U.K. Bribery Act by failing to prevent bribery. If the lack of prosecutorial action has made training on the U.K. Bribery Act a lower priority for you, now is the time to move it up the priority list. Likewise, if you haven’t trained on the Act recently, a refresher course may be in order to ensure employees and third parties are up to speed on the requirements and your company’s policies.

That’s a wrap for this edition of the Compliance News in Review. Keep dancing everyone…and stay compliant.

Compliance News in Review, November 16, 2015

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The OIG 2016 Work Plan is released, the House of Representatives form a task force to combat rising drug costs, a Massachusetts HCP is indicted in the Warner Chilcott case, and CMS releases informational charts to help clear Open Payments confusion.

He’s an international man of mystery, who’s licensed to kill, and he is back in theaters for you viewing pleasure. He’s Bond, James Bond. The latest installment of the series, Spectre, has hit theaters. The reviews are mixed, but hey, all we ask out of a Bond film is a good vodka martini (shaken, not stirred), spectacular gadgets, and a good chase sequence or two. Whilst we check local screening times, we’ll leave you with our own top secret document to peruse, this edition of the Compliance News in Review.

For Your Eyes Only, it’s the OIG 2016 Work Plan. Okay, it may not be top secret, but the 2016 plan is out and it reveals some interesting news for pharma and med device companies. You may recall that in the 2015 Work Plan, the OIG said it would review the financial interests reported under the Open Payments Program. In this year’s Plan, the agency has slightly revised this initiative (revision in bold):

“We will determine the number and nature of financial interests that were reported to CMS under the Open Payments Program. We will also determine the extent to which CMS oversees manufacturers’ and group purchasing organizations’ (GPOs’) compliance with data reporting requirements and whether the required data for physician and teaching hospital payments are valid.”

Previously, the Work Plan stated the OIG would review whether the required data was reported “accurately and completely displayed in the publicly available database.”

U.S. House and Senate members have no Quantum of Solace regarding drug prices in wake of some recent high profile drug price hikes. In the House, a group of Democrats have formed the Affordable Drug Pricing Task Force to pursue “meaningful action to combat the skyrocketing costs of pharmaceuticals.” In the Senate, the Special Committee on Aging is set to investigate large spikes in drug prices. The Committee sent letters to Valeant, Turing Pharmaceuticals and two other companies for information regarding recent large increases in drugs sold. The Committee also requested a face-to-face meeting with the CEO of Turing. Both Valeant and Turing have also received subpoenas from federal prosecutors regarding their drug pricing policies.

A Massachusetts gynecologist was indicted on several different charges including a count of violating the Federal Anti-kickback Statute in connection with Warner Chilcott case. The indictment also seeks criminal forfeiture of $23,500. If found guilty, the doctor could face up to 11 years in prison and fines up to $325,000.

CMS won’t Never Say Never Again to the inclusion of Open Payments data on the Physician Compare website , but it is a no for now. After receiving comments and some consumer testing, it was determined the data is different that data presented on the Physician Compare website. CMS will continue to conduct tests with consumers to determine how best to frame the data.

In the past, the hierarchy associated with teaching hospitals has confused The Living Daylights out of reporting organizations that try to determine how to report payments in the Open Payments system. CMS hoped to clear the confusion by providing a couple of during a recent webinar. One chart is intended to help reporting organizations determine when and how to report payments to teaching hospitals. The other is an organizational chart to help show how the various entities roll up to a teaching hospital on the CMS teaching hospital list. Other topics covered during the webinar included record validation changes for 2015, and how to report stock and stock options as forms of payment.

CMS has been working diligently to improve the Open Payments system. The recent news of improvements offers a good reminder for companies to survey their programs, to make sure  all of the pertinent information related to the changes is being communicated. While the process of preparing systems to handle those changes is important, stakeholders such as sales, R&D, and vendors also need to be aware of how those changes affect their interactions with customers. On-going training is critical.

Well, that’s all the compliance news fit to blog for this edition. Have a great week everyone!

Compliance News in Review, November 2, 2015

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The first corporate criminal bribery settlement under the UK Bribery Act is announced, a Biomet rep files a retaliation suit under the False Claims Act, Novartis settles with the DOJ, Warner Chilcott pleads guilty in a kickback case, and Valeant legal concerns continue to grow.

Here a pumpkin, there a pumpkin, everywhere a pumpkin…or pumpkin spice to be more specific. Seems like there is pumpkin spice version everything these days. That may not be a bad thing though, since according to news reports, a shortage of canned pumpkin may lead to a shortage of pies. The horror! Just in case, better to stock up on those Pumpkin Spice Oreos and Pumpkin Spice Twinkies in the meantime. Happily, there is no shortage of “spicy” compliance stories here at the News in Review, so let’s get this edition cooking!

Something spicy and significant is brewing in Scotland, with regulators announcing the first corporate criminal bribery offence settlement under the Bribery Act. Brand-Rex, a mid-size Scottish cabling systems company, admitted it had failed to prevent an associated person from committing bribery, and agreed to pay £212,800 as confiscation for the benefit gained from the action. The company operated an incentive program for its distributors, and one of its independent distributors offered travel tickets received through the program to a purchasing decision-maker to influence a purchasing decision. Brand-Rex discovered the bribery through an internal audit, and self-disclosed its findings to the authorities. Since the company cooperated with the investigation, it avoided criminal prosecution.

A former Biomet sales representative claims he was not treated gingerly by the company. The rep filed the suit under the anti-retaliation provision of the New York False Claims Act, claiming retaliation by the company after he reported the kickback concerns. According to the rep, he was harassed for 13 months before eventually being fired.

Novartis has carved out a settlement in principle with the DOJ, in a whistleblower case involving the company’s relationship with specialty pharmacies. The agreement will include a settlement of $390 million, and CIA obligations.

Warner Chilcott has agreed to pay $125 million and will plead guilty to a felony charge of healthcare fraud. According to the government, the company paid kickbacks to physicians, manipulated insurance companies to pay for prescriptions, and made unsubstantiated claims about its drugs. The company’s former president was arrested for conspiring to pay kickbacks to physicians, and several physicians and district managers face charges in connection with the case.

The stroll through the pumpkin patch has not been pleasant for Valeant lately. The company was subpoenaed by two US Attorney’s offices to provide documents related to its pricing policies, and its patient assistance and financial support programs. Then Valeant was accused in a report by short-seller, Citron, of creating phantom sales through its relationships with specialty-pharmacies. Citron compared Valeant to Enron in the report. Valeant stock prices took a serious tumble following the report, and led to shareholders filing suit against the company. Lawyers for the shareholders are seeking class action status for the suit.

Orange you glad when friends come to bat for you? (See what we did there – pumpkins are orange, so we said, orange you glad…oh never mind.) A couple of industry groups have done just that for Pacira Pharmaceuticals in its suit against the FDA. PhRMA and a consortium of industry companies known as the Medical Information Working Group (MIWG) have filed Amicus briefs with the court in support of Pacira’s First Amendment case against the FDA. Pacira received a Warning Letter, which has since been de-published by the FDA, over truthful off-label promotion of one of its drugs. The company subsequently filed suit against the agency. The letter from the MIWG points out that promotional speech is protected speech under the First Amendment under the Sorrell v. IMS decision, and the off-label use of drugs is common and often the medical standard of care.

While the topics in this edition of the Compliance News in Review may be varied, they all highlight the need for companies to establish a strong ethical culture. As we saw in the story from Scotland, having procedures in place to identify misconduct is an important first step, but having the courage to bring the evidence of misconduct to authorities is critical as well. Creating an environment in which individuals can report suspect actions without fear of reprisal is paramount.

Have a great week everyone!

Compliance News in Review, October 5, 2015

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CMS releases a new teaching hospital list and de minimis thresholds, ICD-10 is launched, New Hampshire investigates manufacturers of painkillers, and the UK Ministry of Justice reverses its position on expansion of the law.

It is fall y’all! Okay, so the stars and the calendar may have said fall arrived a couple of weeks back, but it just doesn’t seem real until we hit October. The air gets a little crisper, the leaves start changing, and we sadly reach that point when we hope against hope that we can make it through the night without turning the thermostat to “heat.”

Before you know it, all the pumpkins and scarecrows will give way to mistletoe and snowmen (insert collective groan here). Before we all run out for the annual jump into the pile of leaves, let’s grab a cup of cider and your favorite pumpkin spice treat, and review all the compliance news fit to blog, with this edition of the Compliance News in Review.

October first was quite a busy day! First, CMS released the teaching hospital list and de minimis thresholds for Open Payments. In 2016, payments to Covered Recipients of $10.22 or higher will have to be reported and the annual aggregate reporting threshold will be $102.99.

Second, Medicines Australia’s new transparency requirements went into effect. Even though the Code of Conduct was effective in May of this year, implementation of the new transparency requirements was delayed until October. One of the major changes in the transparency requirements was the requirement to report at an individual HCP level rather than in the aggregate.

Finally, October 1st was the “go live” date for ICD -10 (International Classification of Diseases, 10th edition). ICD-10 is the set of diagnostic and procedure codes used by healthcare providers to bill insurance providers and government healthcare programs. The transition to ICD-10 was mandated by the Centers for Medicare and Medicaid Services and is intended to provide more detail over the previous coding system. CMS says ICD-10 will help better “accommodate future healthcare needs, facilitating timely electronic processing of claims by reducing requests for additional information to providers.” While specificity can be a good thing, could ICD-10 be taking it a bit far? Check out some of the more unique codes in the new system. A couple of our favorites are “W56.22xA- Struck by an Orca, initial encounter,” (which apparently spawned a whole book) and “W49.01XA Hair causing external constriction, initial encounter,” also known as the Flynn Rider Code.

New Hampshire is turning a cold shoulder to opioid makers. The state’s Attorney General’s Office has announced it will be investigating the marketing practices of several manufacturers of painkillers. The AG’s Office believes the companies may have engaged in fraudulent marketing practices, which may have misled doctors and patients about the addiction risks and effectiveness of drugs.

The UK is changing its colors regarding expansion of the Bribery Act. Prosecutors had been petitioning to expand the law to make it easier to prosecute businesses involved in bribery, but in response to questions from lawmakers about the proposed changes, the Ministry of Justice said it was no longer interested in pursuing the matter. The response said there was “little evidence of corporate economic wrongdoing going unpunished.”

Conflicts or confluence – decisions, decisions. A recent editorial in the Journal of the American Medical Association (JAMA) makes a case for falling away from using the phrase “conflicts of interest” when describing the secondary interests involved in clinical research. The authors suggest “confluence of interest” instead. They say “conflicts of interest” automatically sets up the notion that something wrong is taking place. The authors point out that in academia, notoriety and fame could be a stronger influence on bias than financial reward. Universities, research institutes, the NIH and medical journals can all impact bias.

October has certainly started with a bang, in the world of physician spend transparency, both here in the U.S. and abroad. The news offers a good reminder that transparency and disclosure measures are constantly evolving. Yet another change will be upon us in 2016 with the removal of the exclusion for speaker of faculty payments for accredited CME.

With all of the changes in motion, now is a perfect time to refresh your company’s training on the requirements of the Sunshine Act and Open Payments. Ensuring your team is aware of the changes is critical, and those in the field need to understand the impact the law has on the healthcare providers they interact with on a regular basis.

That’s a wrap on this edition of the Compliance News in Review. Enjoy the cool weather everyone and have a great week!

News in Review, August 11, 2015

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Industry support of CME increases in 2014,  NuVasive settles False Claims charges while Mead Johnson deals with FCPA charges, and Amarin wins a preliminary injunction in its off-label case against the FDA.

The dog days of summer have certainly arrived in most of the U.S. with temperatures that are best described as hot, hot, hot! Thanks to Willis Carrier and his wonderful invention, we can at least find occasional respite from the sun’s rays and the humidity. So while you wait for a break in the heatwave, crank the A/C up a few notches, grab a cool beverage, and just chill with this edition of the Compliance News in Review.

According to a report from the Accreditation Council for Continuing Medical Education (ACCME), industry support of CME increased 2.4% in 2014. According to the report, industry support represented about a quarter of all CME revenue in 2014, whereas in 2007, that support was closer to half (46%) of CME revenue. Physician attendance at CME dropped by just over one percent, but non-physician attendance rose six percent.

The heat is off for NuVasive now that it has settled with the DOJ. The company has agreed to pay $13.5 million to settle charges it violated the False Claims Act by marketing a product for surgical uses for which it was not approved. According to the government, the company marketed its CoRoent System for several spinal surgical procedures for which it was not approved. The DOJ also claimed kickbacks, in the form of speaker fees honoraria, were paid to induce physicians to use the system. The company was also accused of paying kickbacks for physicians to attend events hosted by Society of Lateral Access Surgery (SOLAS), an organization that was entirely organized and funded by NuVasive.

Mead Johnson entered into a settlement with the SEC to resolve charges it bribed Chinese government healthcare workers to recommend its infant formula, in violation of the FCPA. According to the SEC, the company funded the payments through distributor allowance funds paid to a third-party distributor, and then directed the third-party on how those funds were to be used. Allegedly, the payments were not properly reflected in the company’s books and records.

Insys also finds itself in the doghouse; or in this case, we’ll say the duck house (okay, it’s a reach, but stay with us here). Insys Therapeutics has entered into a settlement with Oregon to resolve a deceptive marketing case. The State claims the company marketed an opioid painkiller for treating mild pain that was only approved for treating pain in cancer patients who are not responding to other types of painkillers. The State also claims the company paid physicians for writing prescriptions and used unqualified physicians to promote the product. The settlement will be split between the State and an organization dedicated to the prevention of opioid abuse, which will be selected by Oregon’s Attorney General.

So it appears, this off-label promotion dog can hunt. Amarin, the company suing the FDA over its ability to promote its fish-oil drug for off-label uses, has won a preliminary injunction against the agency. The injunction is not a final order, but for now, the FDA cannot prevent Amarin from the truthful off-label promotion of its product. The drug is approved for treating patients with very high levels of triglycerides. Amarin would like to promote the drug for use with patients that have moderately elevated triglycerides levels, despite being on a statin.

Like the Caronia decision before it, the Amarin case certainly raises interesting questions about the future of truthful off-label promotion. While a compliance training session may not be the place and time to delve into a discussion of that future, the decision does present an opportunity to discuss off-label promotion and how to address questions related to off-label use. Why not take this opportunity to launch refresher training, or distribute an updated, quick-reference communication piece? On-going reminders about what constitutes off-label promotion, and the policies your organization has in place to address unsolicited questions, are part of any effective compliance curriculum. The case also creates an opportunity to work with commercial team managers on a plan to increase the dialogue about the topic with their teams. Off-label is in the news and the training opportunities abound.

Compliance News in Review, July 10, 2015

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The government targets Novartis for False Claims violations, pharmaceutical companies map out a plan to keep medication flowing into Greece throughout the crisis, and the industry as a whole ponders the impact of the CMS release of 2014 transparency data.

The days are long and lazy – it’s time for summer vacation! From the beach, to the mountains to foreign destinations, the News in Review staff is finalizing plans for summer R&R. Rest assured though, we are still hard at work keeping up with all the compliance news fit to blog, starting with this sun splashed edition of the Compliance News in Review.

The Justice Department and 11 states are putting a dent in the Novartis vacation account with a $3.4 billion charge for damages and fines in a False Claims Act case involving kickbacks to pharmacies. According to prosecutors, the company offered rebate and discount programs to pharmacies in exchange for increased prescriptions of two drugs. Novartis disputes the allegations and says it will continue to defend itself. A trial has been set for November.

Pharma companies are mapping out a plan to keep medication rolling into Greece. According to the European Federation of Pharmaceutical Industries and Associations (EFPIA), the complexity and fragmented nature of the Greek medicine supply chain makes the flow of medication vulnerable. Pfizer, Roche and Novartis said they have plans to ease any shortages during the crisis, and AstraZeneca and GSK have both said they are drawing up contingency plans to keep medicines in supply.

CMS and agg spend folks are probably ready for a break in their routine now that the 2014 Open Payments data has been published. The data shows that companies paid physicians almost $6.5 billion for the year, with over 11 million transactions reported. Research payments topped the list with over $3 billion paid, there were $2.5 billion in general payments and $700K was reported on the ownership reports. CMS was able to validate close to 99% of records submitted to the system, which is a vast improvement over the 2013 data. As was the case in 2014, the majority of the reported payments were small. Sixty-six percent were for payments of less than $20. Research and royalty payments represented the largest dollar amounts.

Once the Open Payments data was released, the numbers quickly found their way into the media. The focus on payments to physician and the influence those payments have on prescribing decisions and healthcare at large is at an all-time high. That level of scrutiny highlights the need for training on the Sunshine Act and Open Payments – especially for those interacting with HCPs. While much of the work related to the reporting requirements is a “back office” function, those interacting with HCPs are often the first to hear concerns from the field and they need to be prepared.

In addition, the public release of the data opens companies to examination of their business practices from whistleblowers and enforcement agencies. Critical evaluation of training is important. Are all the appropriate audiences being covered? Is the training up to date? Is a refresher required? Regular audits of training curriculums and plans are key to reducing the risk of questionable payments, and could spare the company expensive costs down the road.

Have a great weekend!

Compliance News in Review, July 2, 2015

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A former medical device CEO is sentence to two years in prison, the House of Representatives moves on the exemption of payments for CME, textbooks and medical literature under Sunshine, a Connecticut APRN finds herself in hot water over kickbacks, and the first full year of physician payments data is officially available for review.

Unfurl the flag and fire up the grill! It’s time to celebrate the good ole U.S.A. Independence Day is almost here! Whether your celebration of the shot heard ‘round the world and 239 years of the great experiment take you to the shining sea, across the fruited plain, or just to your backyard, we hope it’s a safe and joyous weekend. Until the party begins, we’ll dole out a little history less of our own, with this edition of the Compliance News in Review.

Former OtisMed CEO will have his liberty temporarily revoked. The executive was sentenced to two years in prison for intentionally distributing an unapproved medical device in violation of the FDCA. He was also order to pay a $75,000 fine.

The “people’s house” has been busy recently. The House Energy and Commerce Committee announced that over 200 representatives have signed on to the 21st Century Cures Act. The exemption of payments for CME, textbooks and medical literature from the Sunshine Act is included in the bill. The House also approved a bill to repeal the Affordable Care Act’s tax on medical device manufacturers. The bill now moves to the Senate for a vote.

A Connecticut APRN has admitted to accepting $83,000 in kickbacks from the drug maker Insys Therapeutic. The nurse was a top prescriber of the company’s cancer pain drug. Most of the kickbacks were in the form of payments for serving as a speaker and according to prosecutors, more often than not, the nurse and the sales rep were the only people in attendance at the speaker events. On some occasions, the attendees were friends or colleagues of the nurse who were allowed to prescribe drugs. She will be sentenced in September.

We’re waiting for the fireworks to start now that the first full year of physician payments data has been released by CMS. The payments for 2014 totaled nearly $6.5 billion, and represented 11.4 million transactions to over 600,000 physicians and teaching hospitals. Data from the 2013 program year that could not be posted during 2014 is also included in this year’s release. According to a CMS press release, “registered physicians and teaching hospitals reviewed nearly 30% of the total value of the data and the agency plans on continuing its efforts to work with HCPs to increase that review rate.”

While it’s the multi-million dollar corporate settlements that make the headlines, this week’s news shows that in the world of compliance, individuals suffer significant consequences as well. From the Board to the C-suite, across the corporation and even to the contractors, training needs to emphasize that potential violations are not just a “company problem.”

The release of the 2014 Open Payments data highlights the amount of money being spent by industry on physicians, and exposes physicians to potential criticism and scrutiny. HCPs need to be aware of the rules and regulations companies face because as far as the government is concerned, they represent the company just as the employees do. Providing training that respects these contractors as men and women of science, while fully covering product promotion regulations and law, not only protects the company, it enhances the relationship with these valued partners in healthcare as well.

Have a great Independence Day everyone!