Enforcement Litigation and Compliance Washington, DC December 9-10, 2015 Advanced Enforcement Applications Brian Dahl, Principal, Dahl Compliance Consulting LLC Sarah diFrancesca, Attorney, Cooley LLP James Flaherty, Associate General Counsel – FDA Regulatory, Fresenius Medical Care North America Beth Weinman, Associate Chief Counsel for Enforcement, Office of Chief Counsel, FDA
36
Embed
Enforcement Litigation and Compliance Washington, DC December 9-10, 2015 Advanced Enforcement Applications Brian Dahl, Principal, Dahl Compliance Consulting.
This document is posted to help you gain knowledge. Please leave a comment to let me know what you think about it! Share it to your friends and learn new things together.
Transcript
Enforcement Litigation and Compliance
Washington, DC
December 9-10, 2015
Advanced Enforcement Applications
Brian Dahl, Principal, Dahl Compliance Consulting LLCSarah diFrancesca, Attorney, Cooley LLPJames Flaherty, Associate General Counsel – FDA Regulatory, Fresenius Medical Care North AmericaBeth Weinman, Associate Chief Counsel for Enforcement, Office of Chief Counsel, FDA
Moderated by Neil DiSpirito, Partner, Olsson Frank Weeda Terman Matz PC
Implications of Transparency
Brian A. Dahl
Open Payments
Implications of Transparency• Penalties for What is Not Reported
– $1,000-$10,000/transaction up to $150,000– $10,000-$100,000/transaction up to $1 million
• Penalties for What Is Reported– Kickbacks– False Claims
Case Study: Insys Therapeutics
Case Study: Insys Therapeutics
Case Study: Insys Therapeutics
Case Study: Insys Therapeutics
1. $64,315
2. $61,232
3. $53,085
4. $46,452
5. $43,513
6. $43,154
7. $41,400
8. $41,225
9. $37,382
10. $36,448
Top 10 Physicians for Speaker / Consulting Fees
Case Study: Insys Therapeutics
Case Study: Insys Therapeutics
Case Study: Insys Therapeutics
Case Study: Insys Therapeutics
http://sirf-online.org
Case Study: Insys Therapeutics
A
A
A
A
A
A
A
A
A
A
A
A
A
A
A
a
Case Study: Insys Therapeutics
A
A
A
A
A
A
A
A
A
Aa
A
A
A
A
A
A
A
A
TRICARE Prescriptions
1/1/13-5/31/14
Case Study: Insys Therapeutics • Company Announced Subpoenas
– OIG December 2013 – U.S. Attorney District of MA September 2014
• 6 Other States Reportedly Investigating
Advanced Enforcement Applications
Government Drug Pricing Inquiries
Sarah K. diFrancesca Cooley LLP
Significant Media Attention
Drug Pricing Inquiry TimelineSummer 2015
Valeant
continues to
come under
fire for taking
significant
price increases
on several
additional
drugs
April 2015
WSJ article
discussing
Valeant’s
strategy to buy
drugs and
immediately
increase prices
significantly
July 2015
Valeant CFO
questioned by
Senate’s
Homeland
Security &
Governmental
Affairs
Permanent
Subcommittee
on
Investigations
regarding price
increases
Valeant receives
letter from Senator
McCaskill, Ranking
Member, Senate
Homeland Security &
Governmental
Affairs Permanent
Subcommittee on
Investigations,
requesting
information
regarding Valeant’s
drug price increases
September 2015
Valeant receives
second letter
from Senator
McCaskill, again
requesting
information due
to Valeant’s
“failure to
respond
substantively” to
the August 15,
2015 letter
May 2015
House Govt.
Reform and
Oversight
Committee
Ranking Member
Cummings sends
Chairman
Chaffetz a letter
requesting that
the Committee
hold a hearing in
which Valeant
and Turing CEOs
testify
August 2015
Valeant and Hospira
receive letters from
Rep. Cummings and
Sen. Sanders
requesting
information
regarding Valeant’s
drug pricing
practices
Turing receives
letter from Rep.
Cummings and
Sen. Sanders
requesting
information
regarding
Turing’s drug
pricing practices
September 2015August 2015
July 2014
Gilead receives
letter from
Senators Wyden
and Grassley,
Senate
Committee on
Finance,
requesting
documents
related to
Sovaldi, priced at
$1,000/pill
($84,000/ course
of treatment)
Drug Pricing Inquiry Timeline (cont.)October 2015
Valeant
announces
receipt of
subpoenas from
DOJ and U.S.
Attorneys’ Offices
in NY,
Massachusetts,
Pennsylvania
related to pricing,
patient
assistance, and
related areas of
interest
December 2015
October 2015
Merck and Eli
Lilly each
announce
receipt of CIDs
from the DOJ
and U.S.
Attorneys’ Office
in E.D. of
Pennsylvania
related to drug
pricing,
contracting and
Medicaid
reporting
practices
November 2015
Senate Committee
on Aging issues
letters to Valeant,
Turing, Retrophin,
Rodelis
Therapeutics
regarding
Committee’s
“comprehensive
investigation” into
the pricing of off-
patent drugs.
Document
response due
December 2, 2015
November 2015
Democratic
members of the
House
Committee on
Oversight and
Government
Reform form the
Affordable Drug
Pricing Task
Force
November 2015
Democratic
members of
House Ways and
Means
Committee send
letter to
Chairman Brady
requesting an
“immediate
hearing” into
prescription drug
costs
Initial hearings by
Senate
Committee on
Aging issues
scheduled
December 2015
September 2015
18 members of the
House Committee
on Oversight and
Government
Reform send a
letter to the
Committee
Chairman,
requesting that he
subpoena
documents that
Valeant refused to
turn over to the
Committee in
response to the
August 2015 letter
Senators Wyden
and Grassley,
Senate
Committee on
Finance, release
a 144-page
report and
thousands of
Gilead
documents
produced to the
Committee as
part of its 18-
month
investigation
Chairman
Chaffetz agrees
to hold hearings
in early 2016.
Valeant and
Turing are
anticipated
targets
Areas of Congressional Focus• Senate Finance Committee
– “Senators Wyden and Grassley have raised the following policy questions for public debate, with the goal of improving wider access to effective and affordable drug treatments”
1) What are the effects of a breakthrough, single source innovator drug on the marketplace?
2) Do the payers in the programs have adequate information to know the cost, patient volume, and increases in efficacy of a new treatment regimen?
3) What role does the concept of “value” play into this debate, and how should an innovative therapy’s value be represented in its price?
4) What measures might improve price transparency for new higher-cost therapies while maintaining incentives for manufacturers to invest in new drug development?
5) What tools exist, or should exist, to address the impact of high cost drugs and corresponding access restrictions, particularly on low-income populations and state Medicaid programs?
Areas of Congressional Focus• Senate Committee on Aging
– Substantial price increases on recently acquired off-patent drugs
– Mergers and acquisitions within the pharmaceutical industry that have sometimes led to dramatic price increases for off-patent drugs
– FDA’s role in the drug approval process for generic drugs, FDA’s distribution protocols, and off-label regulatory regime
Political Focus• Presidential candidates also jumping on the drug pricing
bandwagon. Dem. Candidate Hillary Clinton’s plan to lower drug prices includes:
– “eliminate corporate write-offs for direct-to-consumer advertising”– “establish a mandatory FDA pre-clearance procedure for these [DTC] ads funded through user-fees
paid for by pharmaceutical manufacturers”– “require health insurance plans to place a monthly limit of $250 on covered out-of-pocket prescription
drug costs for individuals”– Lower “the biologic exclusivity period from 12 to 7 years”– “require drug manufacturers to provide rebates for low-income Medicare enrollees”– “Allow Medicare to negotiate drug and biologic prices”
State Legislation • Legislation introduced in several states
(CA, MA, NY, NC, OR, PA) that would require pharmaceutical manufacturers to submit reports to the state outlining the total cost of drug production, including marketing costs
Industry Outlook• Companies cutting prices in response to
backlash
• Federal and state legislation
• Outcome of congressional inquiries
• Outcome of DOJ investigations
FDLI Enforcement, Litigation, and FDLI Enforcement, Litigation, and Compliance ConferenceCompliance Conference
Office of the Chief Counsel, Food and Drug Administration
Food & Drug AdministrationFood & Drug AdministrationOffice of Chief CounselOffice of Chief Counsel
• FDA’s Office of the Chief Counsel (OCC) is composed of litigators, counselors, and support staff.
• Litigators handle both civil and criminal enforcement cases, and defend challenges to provisions of the Federal Food, Drug, and Cosmetic Act (FDCA), the implementing regulations, and FDA policies, initiatives, and decisions.
OCI InvestigationsOCI Investigations
•On the criminal side, OCC litigators counsel Office of Criminal Investigations (OCI) agents in their investigations and advise the Department of Justice in its prosecutions related to FDA regulated products.
•In criminal prosecutions, OCC litigators have served as Special Assistant United States Attorneys, assuming primary responsibility for prosecuting violations of the FDCA or related statutes.
One of the most effective ways to combat corporate misconduct is by seeking accountability from the individuals who perpetrated the wrongdoing. Such accountability is important for several reasons: it deters future illegal activity, it incentivizes changes in corporate behavior, it ensures that the proper parties are held responsible for their actions, and it promotes the public's confidence in our justice system.
--September 9, 2015 Memorandum Issued by Sally Quillian Yates, Deputy Attorney General
“Hardship there doubtless may be under a statute which thus penalizes the transaction though consciousness of wrongdoing be totally wanting. Balancing relative hardships, Congress has preferred to place it upon those who have at least the opportunity of informing themselves of the existence of conditions imposed for the protection of consumers before sharing in illicit commerce, rather than to throw the hazard on the innocent public who are wholly helpless.”
--U.S. v. Dotterweich, 320 U.S. 277, 284-285 (U.S. 1943)
Individual Accountability Individual Accountability “Thus Dotterweich and the cases which have followed reveal that in providing sanctions which reach and touch the individuals who execute the corporate mission…the Act imposes not only a positive duty to seek out and remedy violations when they occur but also, and primarily, a duty to implement measures that will insure that violations will not occur. The requirements of foresight and vigilance imposed on responsible corporate agents are beyond question demanding, and perhaps onerous, but they are no more stringent than the public has a right to expect of those who voluntarily assume positions of authority in business enterprises whose services and products affect the health and well-being of the public that supports them.” (emphasis added)
--U.S. v. Park, 421 U.S. 658, 672 (1975)
FDLI Enforcement, Litigation, and FDLI Enforcement, Litigation, and Compliance ConferenceCompliance Conference
Advanced Enforcement Applications
December 9, 2015
James M. Flaherty, Jr.Associate General Counsel – FDA Regulatory
Fresenius Medical Care North America
Why Am I Here?Why Am I Here?
• Not here to debate policy issues behind FDA priorities and initiatives
• Not here to explain what to do once an FDA investigation is initiated
• Here to discuss prevention – achieving and maintaining corporate (and individual) compliance
Focus On The IndividualFocus On The Individual
• Park Doctrine and Yates Memo• Knowledge is Key!• Never Attempt to Shield/Insulate Executives• Education and Training
Metrics, Scorecards, and CultureMetrics, Scorecards, and Culture
• Speak the Executives’ Language• Corporate Compliance = Good Business
– Legal and Compliance as business partners
• Quality metrics adapted for business audience• Utilize summary scorecards – simple and easy
Compliance “Tools”Compliance “Tools”
• Big Data and Predictive Analytics• Safe Islands for Sales Reps• Quality Systems Approach to Training• Newsletters, Recognition, and Awards
3 Pillars of Corporate Healthcare3 Pillars of Corporate Healthcare