Serious Fraud Office

Week in Review, February 17, 2014

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A look back at 2013 FCPA enforcement reveals trends for the future, Brazil enacts an anti-bribery law of its own, at least one attorney wonders if Sunshine will hamper qui tam cases, and the FDA wants medical device adverse event reports submitted electronically.

Well, it’s President’s Day – certainly, one of the more interesting American holidays in terms of its evolution. From what we’re told by the folks at the history channel, the holiday was originally created to celebrate George Washington’s birthday. The shift to “President’s Day” is somewhat convoluted but suffice to say, it was part of the Uniform Monday Holiday, which was passed in 1971 and was intended to create more three day weekends for the nation’s workers, while fighting employee absenteeism by ensuring that holidays fell on the same weekday. Whew! Now that we are all clear on that, let’s focus on something a lot easier to understand, the compliance news of the week, in the News in Review.

Speaking of history, we begin this week with a look back at the DOJ’s enforcement of the FCPA for clues to future trends. Not surprisingly, the scope of FCPA enforcement widened in 2013, and the average cost of resolving increased to $80 million last year. New industries felt the brunt of the Act, with apparel manufacturer, Ralph Lauren, and ATM manufacturer, Diebold, entering into settlements with the government to settle charges. The agencies also expanded their investigatory search beyond written documents to business communication in general, with one representative of a mining company being charged with witness tampering based on a secretly recorded conversation.

A new bribery law  had its inauguration at the end of January. Brazil’s Clean Companies Act went into effect on January 29th. The law allows for the prosecution of  acts of bribery committed by Brazilian companies or foreign companies with a registered affiliate in Brazil. Unlike the FCPA and UK Bribery Act, the Clean Companies Act only carries civil penalties.

Holiday or not, Teva may not be a celebratory mood. The company announced it was under investigation by the government for the marketing practices related to two of its drugs. The government requested documents dating back to 2006 as it conducts the investigation.

From the land adjacent to the “land of Lincoln” comes an announcement of a program designed to educate medical students about the inner workings of the pharmaceutical industry. Eli Lilly is rolling out a four week rotational program where students will experience the various aspects of the drug development process and how physicians contribute to that process. The program will be conducted at Tulane University’s School of Medicine.

On the legal front, during a National Disclosure Summit, a qui tam attorney said Sunshine data could hamper qui tam cases more than it could help. The attorney said relators will have a harder time getting past the False Claims Act “public disclosure bar,” which requires relators to file their claims before information is in the public domain. On the other hand, the Sunshine data will add instant credibility to  a whistleblower’s claims, according to the same attorney. The data can also support an “inference of off-label marketing.”

The FDA announced that beginning in August of 2015, adverse event reports related to medical devices will need to be submitted electronically. The move, which is part of an initiative to improve operations, is expected to save the FDA $1.9 million each year. Companies will save too, but only after an estimated $38 – $42 million dollar investment to upgrade their own systems and procedures.

And so ends this week’s News in Review. With the end of another February in site, now is the time to launch updated product promotion training for 2014. The customizable PharmaCertify™ eLearning module, Good Promotional Practices offers the training your field staff needs on critical topics like gifts, meals and entertainment; advisory boards; and speaker programs.

Have a great week everyone!

 

Week in Review, February 10, 2014

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A device maker settles kickback charges, the Serious Fraud Office looks to beef up the UK Bribery Act, and the FDA makes plans to release more guidance on social media.

The Super Bowl, National Signing Day and the Olympics all in one week; it was a sports fan’s trifecta! Hopefully your team won the game…signed that all important recruit…or took home the early gold! As the best of the best gather in Russia and you keep track of the medal count (Canada, Netherlands and Norway are tied for the early lead), we’ll keep tabs on the world of life sciences compliance. It’s time to light the torch on this week’s News in Review.

That big curling match is about to start in Sochi, and darn it, today is the day you left home without your smartphone. No worries. According to a new study, your healthcare provider  should have one you can borrow. The study finds that the vast majority of physicians are toting smartphones and about 70% have tablets. They’re putting the devices to use in their practice with the tablets being the tool of choice for content heavy tasks.

Device maker CareFusion recently spent some time in the penalty box. The company agreed to pay $40.1 million to settle charges it concealed kickbacks to a physician and marketed its surgical prep solution for off label uses.

Serious Fraud Office chief, David Green, wants to change the rules related to the Bribery Act. Green is proposing an amendment to the Act that would subject companies to fines and blacklisting if those companies fail to prevent financial crime by their employees. The law currently has a provision whereby companies are held liable for failing to prevent bribery. Green says the new power would only be used in “exceptional cases.”

Fortunately, we can look forward to more commentary on research and drug marketing during 2014. The FDA is expected to release more guidance on the use of social media in drug marketing, and guidance on the electronic submission of promotional labeling and advertising. The OIG plans to investigate issues around the price of drugs, including whether off-label uses should be reimbursable. For more in depth expert analysis of the OIG Work Plan, check out the video released by OIG, during which representatives discuss the agencies top priorities for the year and emerging trends in combating healthcare waste.

Speaking of the FDA, the agency may be ready to step up its enforcement of the regulations prohibiting off-label promotion. At a recent conference, an attorney for Pfizer, Emily Wright, noted that the industry should expect to see an increase in enforcement in the near future. Wright made note that the FDA issued two letters related to press releases in 2012 and she expects to see more.

And finally entering the stadium (cue the triumphant fanfare)…Open Payments registration! CMS has announced that beginning February 18th, registration and data submission will commence in two phases. During the first phase (February 18th – March 31st), users can register in CMS’ Enterprise Portal, and submit corporate profile information and 2013 aggregate data. Phase two will kick off in May.

Well that’s it for this edition of the News in Review. As you marvel at the accomplishments of the world’s greatest athletes this week, don’t forget to take the time to analyze your compliance curriculum for areas that need enhanced training. PharmaCertify™ off-the-shelf modules and mobile apps offer up-to-date content on topics like, on-label promotion, good promotional practices and the Sunshine Act, where your staff needs it most–in the field and at their fingertips.

Have a gold medal week everyone!

Week in Review, January 21, 2014

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The Serious Fraud Office adds Deferred Prosecution Agreements to its arsenal, doctors in the UK are looking for more transparency and one generic drug manufacturer gives up on China.

The teams for Super Bowl XLVII are set! The Seattle Seahawks and the Denver Broncos will do battle in New Jersey in February. Hmm, New Jersey…in February. Nothing against the Garden State (for many of us, it is home), but wouldn’t a warmer climate be more inviting for those with a ticket? Barring any blizzards, the game should be exciting as the top offense and top defense in the NFL face off. We know we’ll be tuned in, but until then there’s other news to address. Let’s kickoff this week’s News in Review.

February is shaping up to be a big month for the Serious Fraud office as well. Beginning next month, the SFO will be able to utilize Deferred Prosecution Agreements as a tool to deal with corporate bribery. The advantage to the SFO and to corporations is that agreements can be negotiated without prolonged court cases or the eventual debarment for corporations if they were found guilty through a trial. Implementing DPAs will bring its own set of challenges though. Judges in certain jurisdictions in the UK prefer justice to be doled out in court and not in advance. Consultation with judges prior to an agreement being signed should help, but the judges are not bound to accept the agreements. That leads to an issue of consistency in the process. If companies can’t rely on agreements being ratified by judges, they will be less likely to engage in the negotiations.

British doctors and academics teamed up to ask for more transparency in physician conflicts of interest. In an open letter appearing in the British Medical Journal, the group called on the General Medical Council to set up a general registry for physicians’ conflicts of interest. The letter cited an ABPI estimate that nearly 40 million pounds are paid to physicians by the pharmaceutical industry, and that the recipients of those payments are largely unknown. The letter said transparency into just who is receiving those payments “can only be good for medical practice.” A spokesperson from the GMC said that it could not require doctors to disclose payments without a change in law.

Generic drug maker Activis is scrapping its China playbook. The company announced it would cease operations in China. It’s CEO said China was not a “business friendly environment,” and there is too much risk in doing business there. The company has a small profile in China, and while it has not run into the issues some other pharmaceutical companies have of late, the CEO said he wasn’t confident that if anything did happen, the company would get a fair hearing.

2013 was another record setting year for False Claims Act recoveries, according to the DOJ. The DOJ collected $3.8 billion during the 2013 fiscal year. Of the $3.8 billion, $2.6 billion was from healthcare fraud recoveries. The majority of that $2.6 billion was from settlements with pharmaceutical industry companies.

Congress is calling for a review following CMS’ explanation for why payments for textbooks and journal reprints are not excluded from Sunshine reporting. The explanation provided by CMS did not sit well with members of Congress, and some are exploring options for changing the requirement. An aide to Maryland Representative Andrew Harris said the Congressman plans to add language to an appropriations bill to halt the collection of the data.

The fourth quarter’s here and it’s time to wrap this thing up. Before we dump the bucket of virtual sports drink over the head of this week’s Review though, we have to ask if you feel confident with your compliance training lineup for 2014. Do you need to add a new player or get back to training on the basics? The PharmaCertify™ suite of compliance training solutions includes two key players – Good Promotional Practices offers a comprehensive review of compliant product promotion practices and concepts for your sales team, and Commercial Compliance Overview is a comprehensive review of commercial compliance for your entire staff.

Have a great week everyone!

Week in Review, December 16, 2013

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The Serious Fraud Office hits another bump in the road, Brazil expands its anti-corruption efforts, and the Pew Charitable Trusts and the CME Coalition disagree on suggested changes for the industry’s interaction with medical schools.

As the song goes, “the weather outside is frightful.” The string of winter storms over the last week has brought snow for some, ice for others, and a lovely cold rain over much of the country. Welcome to early winter! Yes, we know, the calendar still says we’re in the fall. If you’re one of the unfortunate ones scraping snow and ice off your windshields and sidewalks already, we can’t offer much in the way of help with that shovel, but we can help you catch up on the compliance news you need to know, with this week’s News in Review.

The Serious Fraud Office is facing more stormy weather. The agency abruptly called off the high-profile bribery case against businessman Victor Dahdaleh. Dahdaleh was accused of paying millions in bribes to managers at Aluminum Bahrain (Alba) over a period of eight years.  The trial began in early November, and the SFO had to call an end to their prosecution when two U.S. lawyers who had helped with case refused to testify and a third witness changed his testimony. The two U.S. lawyers also represent Alba in a civil case, which raises questions about whether they should be used in the British criminal case. The case is the latest in a string of embarrassing and expensive missteps for the SFO.

New legislation has been introduced in Canada that would require doctors and pharmaceutical companies to reveal more information about the adverse effects associated with pharmaceutical products. The law would require doctors to notify Health Canada when patients have an adverse drug experience, and pharmaceutical companies would then be required to make immediate changes to a drug’s label to reflect the new safety concerns.

A change in the anti-corruption weather is on the horizon in Brazil. The Clean Companies Act (CCA) will go in effect January 29, 2014. The anti-bribery law shares a number of similarities with the FCPA and U.K. Bribery Act. The law applies to any company or legal entity doing business in Brazil, and applies to the bribery of both domestic and foreign government officials at any level. It also prohibits facilitation payments and implements strict liability for legal entities involved in corruption.

The courtroom had to be frosty when Boehringer Ingelheim was handed a $931,000 fine for losing documents related its Praxada drug. The judge said the company allowed the documents to be destroyed, and that attempts to create back up versions were even thwarted. Further, the company disabled programs that would have preserved voicemail and text messages. The loss of the documents affects 1,700 patient lawsuits.

A report from the Pew Charitable Trusts suggests industry-physician interactions at the nation’s medical schools need to be put in the deep freeze. The recommendations from Pew include the typical ban on rep visits, meals, gifts, etc., as well as a suggestion that school staff not accept speaking fees from pharmaceutical companies.

The CME Coalition would like to put the Pew recommendations on ice though. Senior advisor to the CME Coalition, Adam Rosenberg, says the recommendations in the report are “irresponsible,” and “they are nothing short of dangerous to America’s health.” For example, even though Pew recommends that CME should be free of industry funding, the organization cites no studies or evidence showing that funding is leading to poor patient outcomes, or is unduly influencing prescribing decisions.

And so we come to the end of this chilly edition of the News Week in Review. If adverse events reporting is at the top of your holiday and new year wish list, the newest off-the-shelf module from PharmaCertify™, Adverse Events and Product Complaints, covers the definitions and sources of events and complaints, as well as the information needed to ensure accurate reports are filed. As with all of the PharmaCertify™ solutions, the module is easily customized with your  organization’s procedures and policies.

Stay warm everyone, and have a great week!