<?xml version="1.0" encoding="UTF-8"?><rss version="2.0" xmlns:content="http://purl.org/rss/1.0/modules/content/" xmlns:wfw="http://wellformedweb.org/CommentAPI/" xmlns:dc="http://purl.org/dc/elements/1.1/" xmlns:atom="http://www.w3.org/2005/Atom" xmlns:sy="http://purl.org/rss/1.0/modules/syndication/" xmlns:slash="http://purl.org/rss/1.0/modules/slash/" > <channel> <title>FCPA – Policy & Medicine</title> <atom:link href="https://www.policymed.com/category/fcpa/feed" rel="self" type="application/rss+xml" /> <link>https://www.policymed.com</link> <description>Legal, Regulatory, and Compliance Issues</description> <lastBuildDate>Thu, 12 Sep 2024 22:50:46 +0000</lastBuildDate> <language>en-US</language> <sy:updatePeriod> hourly </sy:updatePeriod> <sy:updateFrequency> 1 </sy:updateFrequency> <image> <url>https://www.policymed.com/wp-content/uploads/2018/05/cropped-favicon-32x32.png</url> <title>FCPA – Policy & Medicine</title> <link>https://www.policymed.com</link> <width>32</width> <height>32</height> </image> <item> <title>Novartis Resolves FCPA Investigations</title> <link>https://www.policymed.com/2020/07/novartis-resolves-fcpa-investigations.html</link> <comments>https://www.policymed.com/2020/07/novartis-resolves-fcpa-investigations.html#respond</comments> <dc:creator><![CDATA[Thomas Sullivan]]></dc:creator> <pubDate>Wed, 22 Jul 2020 09:01:27 +0000</pubDate> <category><![CDATA[FCPA]]></category> <category><![CDATA[NEW]]></category> <guid isPermaLink="false">https://www.policymed.com/?p=13672</guid> <description><![CDATA[<div style="margin-bottom:20px;"><img width="300" height="200" src="https://www.policymed.com/wp-content/uploads/2020/06/bribe-money-changing-hands.jpg" class="attachment-post-thumbnail size-post-thumbnail wp-post-image" alt="" decoding="async" fetchpriority="high" /></div>On June 25, 2020, the United States Department of Justice (DOJ) announced an agreement with Novartis Hellas S.A.C.I. (Novartis Greece) – a current subsidiary of Novartis AG – and Alcon Pte Ltd – a former subsidiary of Novartis AG and current subsidiary of Alcon Inc. – over violations of the Foreign Corrupt Practices Act (FCPA). […]]]></description> <content:encoded><![CDATA[<div style="margin-bottom:20px;"><img width="300" height="200" src="https://www.policymed.com/wp-content/uploads/2020/06/bribe-money-changing-hands.jpg" class="attachment-post-thumbnail size-post-thumbnail wp-post-image" alt="" decoding="async" /></div><p>On June 25, 2020, the United States Department of Justice (DOJ) <a href="https://www.justice.gov/opa/pr/novartis-hellas-saci-and-alcon-pte-ltd-agree-pay-over-233-million-combined-resolve-criminal">announced</a> an agreement with Novartis Hellas S.A.C.I. (Novartis Greece) – a current subsidiary of Novartis AG – and Alcon Pte Ltd – a former subsidiary of Novartis AG and current subsidiary of Alcon Inc. – over violations of the Foreign Corrupt Practices Act (FCPA). The agreement results in Novartis AG, Novartis Hellas S.A.C.I., and Alcon Pte Ltd paying a combined $345 million.</p> <p>The allegations resolved in the agreement stem from a Novartis Greece scheme to bribe employees of state-owned and state-controlled hospitals and clinics in Greece and to falsely record improper payments relating to the corrupt scheme and similar conduct. Alcon Pte Ltd had a similar scheme to make and falsely record improper payments in Vietnam.</p> <p>As part of their agreements, both parties agreed to continue to cooperate with the government in ongoing or future criminal investigations concerning the companies, its executives, employees, or agents. Both also agreed to enhance their compliance programs and report to the government on the implementation of their enhanced compliance programs.</p> <p><strong>Novartis Greece</strong></p> <p>According to <a href="https://www.justice.gov/opa/press-release/file/1289746/download">its admissions in the DPA</a>, between 2012 and 2015, Novartis Greece conspired with others to violate the FCPA by engaging in a scheme to bribe employees of state-owned and state-controlled hospitals and clinics in Greece in order to increase the sale of Novartis-branded pharmaceutical products. More specifically, Novartis Greece paid for employees of the hospitals and clinics to travel to international medical congresses, including to events held in the United States, as a way to bribe the officials to increase the number of prescriptions they wrote for Lucentis, a Novartis Greece prescription drug. As part of the scheme, Novartis Greece employees traveled to the United States, and, while located in the United States, facilitated the provision of the improper benefits to publicly employed Greek health care providers.</p> <p>Novartis Greece also <a href="https://www.justice.gov/opa/press-release/file/1289746/download">admitted</a> that between 2009 and 2010, it made improper payments to health care providers in connection with an epidemiological study that was intended to increase sales of certain Novartis-branded prescription drugs. The study was used as a way to make improper payments to health care providers to increase sales of certain Novartis-branded prescription drugs. Novartis Greece employees also recognized that many participating health care providers believed that they were being paid in exchange for writing prescriptions of Novartis products and not for providing data as part of a clinical study.</p> <p>Therefore, in furtherance of both schemes, Novartis Greece, through its employees and agents, knowingly and willfully conspired with others to cause Novartis AG to mischaracterize and falsely record improper payments related to the international medical congresses and the epidemiological study in Novartis AG’s books, records, and accounts.</p> <p><em>Deferred Prosecution Agreement</em></p> <p>As part of the resolution, Novartis Greece <a href="https://www.justice.gov/opa/press-release/file/1289746/download">entered into a deferred prosecution agreement (DPA)</a> in connection with a <a href="https://www.justice.gov/opa/press-release/file/1289751/download">criminal Information</a> that charged Novartis Greece with one count of conspiracy to violate the anti-bribery provisions of the FCPA and one count of conspiracy to violate the books and records provision of the FCPA.</p> <p>Under the DPA, Novartis Greece committed to pay a total criminal monetary penalty of $225 million. The penalty reflects a 25 percent reduction off a point near the midpoint of the U.S. Sentencing Guidelines range because, despite full cooperation and remediation by Novartis Greece, its parent company Novartis AG was involved in similar conduct for which it <a href="https://www.sec.gov/litigation/admin/2016/34-77431-s.pdf">previously reached a resolution</a> with the United States Securities and Exchange Commission (SEC) in March 2016.</p> <p><em>SEC Disgorgement </em></p> <p>In a related matter with the SEC, <a href="https://www.sec.gov/news/press-release/2020-144">Novartis AG agreed to pay the SEC</a> disgorgement and prejudgment interest over $112 million for its conduct in multiple countries, including South Korea, Greece and Vietnam.</p> <p><strong>Alcon Pte Ltd.</strong></p> <p><a href="https://www.justice.gov/opa/press-release/file/1289736/download">According to its admissions</a>, from 2011 through 2014, Alcon Pte Ltd knowingly and willfully conspired with others to cause Novartis AG to maintain false books, records and accounts, as a result of a scheme to bribe employees of state-owned and state-controlled hospitals and clinics in Vietnam.</p> <p>Specifically, the false books and records <a href="https://www.justice.gov/opa/press-release/file/1289736/download">resulted from Alcon employees in Vietnam making corrupt payments</a> through a third-party distributor to employees of state-owned and state-controlled hospitals and clinics in Vietnam to increase sales of intraocular lenses. Alcon employees in Vietnam would reimburse the distributor for up to 50 percent of the cost of the corrupt payments. Those reimbursements were falsely recorded as consulting expenses, marketing expenses, administration expenses, and human resource expenses.</p> <p><em>Deferred Prosecution Agreement</em></p> <p>Alcon Pte Ltd, a subsidiary of Novartis AG at the time of the misconduct, <a href="https://www.justice.gov/opa/press-release/file/1289736/download">entered into a separate DPA</a> in connection with a <a href="https://www.justice.gov/opa/press-release/file/1289741/download">criminal Information</a> filed in the District of New Jersey. In the Information, Alcon Pte Ltd was charged with conspiracy to violate the books and records provision of the FCPA.</p> <p><a href="https://www.justice.gov/opa/press-release/file/1289736/download">Pursuant to the DPA</a>, Alcon Pte Ltd has agreed to pay a total criminal monetary penalty of approximately $8.9 million. The criminal monetary penalty reflects a 25 percent reduction off the bottom of the U.S. Sentencing Guidelines fine range because of Alcon Pte Ltd’s full cooperation with the government’s investigation.</p> ]]></content:encoded> <wfw:commentRss>https://www.policymed.com/2020/07/novartis-resolves-fcpa-investigations.html/feed</wfw:commentRss> <slash:comments>0</slash:comments> </item> <item> <title>Alexion Reaches Agreement in Principle with SEC Over FCPA Violations</title> <link>https://www.policymed.com/2020/07/alexion-reaches-agreement-in-principle-with-sec-over-fcpa-violations.html</link> <comments>https://www.policymed.com/2020/07/alexion-reaches-agreement-in-principle-with-sec-over-fcpa-violations.html#respond</comments> <dc:creator><![CDATA[Thomas Sullivan]]></dc:creator> <pubDate>Tue, 14 Jul 2020 09:01:02 +0000</pubDate> <category><![CDATA[FCPA]]></category> <category><![CDATA[Medical Legal]]></category> <category><![CDATA[NEW]]></category> <guid isPermaLink="false">https://www.policymed.com/?p=13655</guid> <description><![CDATA[<div style="margin-bottom:20px;"><img width="1200" height="627" src="https://www.policymed.com/wp-content/uploads/2020/06/Id-Alxn-Logo-R-Rgb.jpg" class="attachment-post-thumbnail size-post-thumbnail wp-post-image" alt="" decoding="async" srcset="https://www.policymed.com/wp-content/uploads/2020/06/Id-Alxn-Logo-R-Rgb.jpg 1200w, https://www.policymed.com/wp-content/uploads/2020/06/Id-Alxn-Logo-R-Rgb-300x157.jpg 300w, https://www.policymed.com/wp-content/uploads/2020/06/Id-Alxn-Logo-R-Rgb-1024x535.jpg 1024w, https://www.policymed.com/wp-content/uploads/2020/06/Id-Alxn-Logo-R-Rgb-768x401.jpg 768w" sizes="(max-width: 1200px) 100vw, 1200px" /></div>In its May 2020 annual report filed with the United States Securities and Exchange Commission (SEC), Alexion Pharmaceuticals, Inc., said it reached an agreement in principle with the SEC to resolve the Foreign Corrupt Practices Act (FCPA) investigation against it. The Probe Around May 2015, the SEC began to investigate Alexion’s grant-making activities and FCPA-compliance […]]]></description> <content:encoded><![CDATA[<div style="margin-bottom:20px;"><img width="1200" height="627" src="https://www.policymed.com/wp-content/uploads/2020/06/Id-Alxn-Logo-R-Rgb.jpg" class="attachment-post-thumbnail size-post-thumbnail wp-post-image" alt="" decoding="async" loading="lazy" srcset="https://www.policymed.com/wp-content/uploads/2020/06/Id-Alxn-Logo-R-Rgb.jpg 1200w, https://www.policymed.com/wp-content/uploads/2020/06/Id-Alxn-Logo-R-Rgb-300x157.jpg 300w, https://www.policymed.com/wp-content/uploads/2020/06/Id-Alxn-Logo-R-Rgb-1024x535.jpg 1024w, https://www.policymed.com/wp-content/uploads/2020/06/Id-Alxn-Logo-R-Rgb-768x401.jpg 768w" sizes="auto, (max-width: 1200px) 100vw, 1200px" /></div><p>In its <a href="https://ir.alexion.com/static-files/03035174-d46e-403f-a30b-d35f7f6c0785">May 2020 annual report</a> filed with the United States Securities and Exchange Commission (SEC), Alexion Pharmaceuticals, Inc., said it reached an agreement in principle with the SEC to resolve the Foreign Corrupt Practices Act (FCPA) investigation against it.</p> <p><strong>The Probe</strong></p> <p>Around May 2015, the <a href="https://www.sec.gov/Archives/edgar/data/899866/000157104915004584/t1501230-s4.htm">SEC began to investigate</a> Alexion’s grant-making activities and FCPA-compliance in multiple countries, including Brazil, Columbia, Japan, Russia, and Turkey.</p> <p>Later in 2015, the United States Department of Justice (DOJ) also <a href="https://www.sec.gov/Archives/edgar/data/899866/000089986615000189/alxn9301510q.htm">opened an investigation</a> into Alexion’s compliance with the FCPA. Recently, the <a href="https://www.wsj.com/articles/alexion-pharmaceuticals-strikes-tentative-25-million-bribery-settlement-11588785508">DOJ had told Alexion</a> it closed its inquiry into the matter.</p> <p>The SEC and DOJ also sought information related to recalls of specific lots of its rare blood and kidney disease medication SOLIRIS and related securities disclosures. Not much more on either investigation was released by Alexion, the SEC, or the DOJ. That is, until recently, when the news broke about the May annual report that indicated an agreement in principle had been reached.</p> <p><strong>The Agreement</strong></p> <p>Alexion has set aside $25 million for the “agreement in principle” to resolve the allegations levied against the company. It is important to note that <a href="https://ir.alexion.com/static-files/03035174-d46e-403f-a30b-d35f7f6c0785">Alexion also indicates</a> that “there can be no assurance that a definitive agreement reflecting the terms of the agreement in principle will be agreed to or finalized.” The annual report also notes that if a definitive agreement cannot be reached, or if the terms of any definitive agreement are different than the agreement in principle, it is possible that a loss related to these matters may be incurred and it may be larger than the amount currently set aside.</p> <p>The <a href="https://ir.alexion.com/static-files/03035174-d46e-403f-a30b-d35f7f6c0785">filing also discusses</a> what will happen if a definitive agreement is not reached and the SEC continues its investigation. In that case, the SEC may pursue litigation to determine whether Alexion’s operations or activities were not in compliance with existing laws or regulations. That litigation may result in additional fines, civil penalties, or equitable remedies, including disgorgement, injunctive relief, and/or other sanctions.”</p> <p>The <a href="https://ir.alexion.com/static-files/03035174-d46e-403f-a30b-d35f7f6c0785">annual report indicates</a> that Alexion will continue to cooperate with the probes and that the company is “committed to strengthening its compliance program and is currently enhancing and continuing to implement a comprehensive company-wide transformation plan” to improve its “business processes, structures, controls, training, talent, and systems” across its global operations.</p> ]]></content:encoded> <wfw:commentRss>https://www.policymed.com/2020/07/alexion-reaches-agreement-in-principle-with-sec-over-fcpa-violations.html/feed</wfw:commentRss> <slash:comments>0</slash:comments> </item> <item> <title>Christmas Comes Early – The FCPA Pilot Program Made Permanent</title> <link>https://www.policymed.com/2018/01/christmas-comes-early-the-fcpa-pilot-program-made-permanent.html</link> <comments>https://www.policymed.com/2018/01/christmas-comes-early-the-fcpa-pilot-program-made-permanent.html#respond</comments> <dc:creator><![CDATA[Thomas Sullivan]]></dc:creator> <pubDate>Thu, 18 Jan 2018 23:30:00 +0000</pubDate> <category><![CDATA[FCPA]]></category> <category><![CDATA[Life Science Compliance Update]]></category> <category><![CDATA[NEW]]></category> <guid isPermaLink="false">http://www.policymed.com/christmas-comes-early-the-fcpa-pilot-program-made-permanent/</guid> <description><![CDATA[<div style="margin-bottom:20px;"><img width="679" height="452" src="https://www.policymed.com/wp-content/uploads/2018/01/11-1.png" class="attachment-post-thumbnail size-post-thumbnail wp-post-image" alt="" decoding="async" loading="lazy" srcset="https://www.policymed.com/wp-content/uploads/2018/01/11-1.png 679w, https://www.policymed.com/wp-content/uploads/2018/01/11-1-300x200.png 300w" sizes="auto, (max-width: 679px) 100vw, 679px" /></div>When we first introduced the FCPA Pilot Program in the June 2016 issue, we noted the uncertainties of outcomes for companies who voluntarily self-disclose potential violations. On November 29, 2017, Deputy Attorney General Rod Rosenstein announced that the US Department of Justice (DOJ) had made the FCPA Pilot Program permanent. This article will review some of […]]]></description> <content:encoded><![CDATA[<div style="margin-bottom:20px;"><img width="679" height="452" src="https://www.policymed.com/wp-content/uploads/2018/01/11-1.png" class="attachment-post-thumbnail size-post-thumbnail wp-post-image" alt="" decoding="async" loading="lazy" srcset="https://www.policymed.com/wp-content/uploads/2018/01/11-1.png 679w, https://www.policymed.com/wp-content/uploads/2018/01/11-1-300x200.png 300w" sizes="auto, (max-width: 679px) 100vw, 679px" /></div><p><em><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">When we first introduced the FCPA Pilot Program in the June 2016 issue, we noted the uncertainties of outcomes for companies who voluntarily self-disclose potential violations. On </span><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">November 29, 2017, Deputy Attorney General Rod Rosenstein announced that the US Department of Justice (DOJ) had made the FCPA Pilot Program permanent. This article will review some of the key highlights outlined by the DOJ and some considerations for compliance professionals.</span></em></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">The heat is on life science companies. Since 2013, there have been 25 Foreign Corruption Practices Act (“FCPA”) matters involving life science companies, 13 of which occurred in the last two years. Although life science companies have not been immune to FCPA investigations in the past, the statement of Acting Chief of the U.S. Department of Justice (“DOJ”) Fraud Section, Sandra Moser in August was loud and clear – the DOJ would be increasing its enforcement efforts of healthcare related companies.</span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">We reviewed the outcomes of the FCPA Pilot Program (“Pilot Program”) in the September 2017 issue of the Update, examining the benefits of self-disclosure under the program. Now, a <span style="color: #b9b9b9;">y<span style="background-color: #ffffff;">ear since its inception, the DOJ has announced that the Pilot Program will now be permanent.</span></span></span></p> <div style="height: 30px; background: #336699; width: 750px; padding: 10px 0px 4px 20px; font-family: Verdana,sans-serif; font-size: 1.2em; color: white;">To Read the Full Story, <a style="color: white;" href="http://www.lifescicompliance.com/subscription-options/"><strong>Subscribe</strong></a>, <strong>Download a <a style="color: white;" href="https://www.lifescicompliance.com/sample-issue-contact-information/">Sample Issue</a></strong>, or <a style="color: white;" href="https://www.lifescicompliance.com/login/"><strong>Sign In</strong></a></div> <div style="width: 770px;"><a href="http://www.lifescicompliance.com"><img decoding="async" class="asset asset-image at-xid-6a00e5520572bb883401b8d1c8ad6d970c image-full img-responsive" style="width: 770px;" title="PM_LSCU_Box" src="http://policymed.typepad.com/.a/6a00e5520572bb883401b8d1c8ad6d970c-800wi" alt="PM_LSCU_Box" height="253" border="0" /></a></div> ]]></content:encoded> <wfw:commentRss>https://www.policymed.com/2018/01/christmas-comes-early-the-fcpa-pilot-program-made-permanent.html/feed</wfw:commentRss> <slash:comments>0</slash:comments> </item> <item> <title>To Disclose or Not to Disclose… That is the Question: The DOJ’s FCPA Pilot Program – Insights from Year One and Beyond</title> <link>https://www.policymed.com/2017/09/to-disclose-or-not-to-disclose-that-is-the-question-the-dojs-fcpa-pilot-program-insights-from-year-o.html</link> <comments>https://www.policymed.com/2017/09/to-disclose-or-not-to-disclose-that-is-the-question-the-dojs-fcpa-pilot-program-insights-from-year-o.html#respond</comments> <dc:creator><![CDATA[Thomas Sullivan]]></dc:creator> <pubDate>Thu, 21 Sep 2017 23:30:00 +0000</pubDate> <category><![CDATA[DOJ]]></category> <category><![CDATA[FCPA]]></category> <category><![CDATA[Life Science Compliance Update]]></category> <category><![CDATA[NEW]]></category> <guid isPermaLink="false">http://www.policymed.com/to-disclose-or-not-to-disclose-that-is-the-question-the-dojs-fcpa-pilot-program-insights-from-year-o/</guid> <description><![CDATA[<div style="margin-bottom:20px;"><img width="1024" height="505" src="https://www.policymed.com/wp-content/uploads/2017/09/1-2.png" class="attachment-post-thumbnail size-post-thumbnail wp-post-image" alt="" decoding="async" loading="lazy" srcset="https://www.policymed.com/wp-content/uploads/2017/09/1-2.png 1024w, https://www.policymed.com/wp-content/uploads/2017/09/1-2-300x148.png 300w, https://www.policymed.com/wp-content/uploads/2017/09/1-2-768x379.png 768w" sizes="auto, (max-width: 1024px) 100vw, 1024px" /></div>It has been over one-year since the US Department of Justice has launched its pilot program aimed to incentivize companies to self-report potential Foreign Corrupt Practices Act violations. Since its launch on April 5, 2016, the Justice Department resolved nine investigations. However, the question still remains – “Is the carrot bigger than the stick?” This […]]]></description> <content:encoded><![CDATA[<div style="margin-bottom:20px;"><img width="1024" height="505" src="https://www.policymed.com/wp-content/uploads/2017/09/1-2.png" class="attachment-post-thumbnail size-post-thumbnail wp-post-image" alt="" decoding="async" loading="lazy" srcset="https://www.policymed.com/wp-content/uploads/2017/09/1-2.png 1024w, https://www.policymed.com/wp-content/uploads/2017/09/1-2-300x148.png 300w, https://www.policymed.com/wp-content/uploads/2017/09/1-2-768x379.png 768w" sizes="auto, (max-width: 1024px) 100vw, 1024px" /></div><p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;"><em>It has been over one-year since the US Department of Justice has launched its pilot program aimed to incentivize companies to self-report potential Foreign Corrupt Practices Act violations. Since its launch on April 5, 2016, the Justice Department resolved nine investigations. However, the question still remains – “Is the carrot bigger than the stick?” This article examines settlement trends before and during the Pilot Program to answer the question of whether or not it is sensible to self-disclose.</em></span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">Last month, Sandra Moser, the acting chief of the DOJ’s Fraud Section made it clear that the DOJ would be increasing its enforcement efforts of healthcare related companies. Although life science companies have not been immune to Foreign Corrupt Practices Act (“FCPA”) investigations in the past, Moser stated that the DOJ viewed the healthcare industry as ‘one that faces serious compliance and corruption challenges not only in high risk markets overseas but right here at home as well.’ Simply put, life science companies will <span style="color: #b9b9b9;">be under the FCPA microscope more than ever.</span></span></p> <div style="height: 30px; background: #336699; width: 750px; padding: 10px 0px 4px 20px; font-family: Verdana,sans-serif; font-size: 1.2em; color: white;">To Read the Full Story, <a style="color: white;" href="http://www.lifescicompliance.com/subscription-options/"><strong>Subscribe</strong></a>, <strong>Download a <a style="color: white;" href="https://www.lifescicompliance.com/sample-issue-contact-information/">Sample Issue</a></strong>, or <a style="color: white;" href="https://www.lifescicompliance.com/login/"><strong>Sign In</strong></a></div> <div style="width: 770px;"><a href="http://www.lifescicompliance.com"><img decoding="async" class="asset asset-image at-xid-6a00e5520572bb883401b8d1c8ad6d970c image-full img-responsive" style="width: 770px;" title="PM_LSCU_Box" src="http://policymed.typepad.com/.a/6a00e5520572bb883401b8d1c8ad6d970c-800wi" alt="PM_LSCU_Box" height="253" border="0" /></a></div> ]]></content:encoded> <wfw:commentRss>https://www.policymed.com/2017/09/to-disclose-or-not-to-disclose-that-is-the-question-the-dojs-fcpa-pilot-program-insights-from-year-o.html/feed</wfw:commentRss> <slash:comments>0</slash:comments> </item> <item> <title>TEVA – Using Legitimate Distributor Payments to Conceal Bribes</title> <link>https://www.policymed.com/2017/04/teva-using-legitimate-distributor-payments-to-conceal-bribes.html</link> <comments>https://www.policymed.com/2017/04/teva-using-legitimate-distributor-payments-to-conceal-bribes.html#respond</comments> <dc:creator><![CDATA[Thomas Sullivan]]></dc:creator> <pubDate>Sun, 23 Apr 2017 23:30:00 +0000</pubDate> <category><![CDATA[FCPA]]></category> <category><![CDATA[Life Science Compliance Update]]></category> <category><![CDATA[NEW]]></category> <guid isPermaLink="false">http://www.policymed.com/teva-using-legitimate-distributor-payments-to-conceal-bribes/</guid> <description><![CDATA[<div style="margin-bottom:20px;"><img width="553" height="369" src="https://www.policymed.com/wp-content/uploads/2017/04/TEVA-Using-Legitimate-Distributor-Payments-to-Conceal-Bribes.png" class="attachment-post-thumbnail size-post-thumbnail wp-post-image" alt="" decoding="async" loading="lazy" srcset="https://www.policymed.com/wp-content/uploads/2017/04/TEVA-Using-Legitimate-Distributor-Payments-to-Conceal-Bribes.png 553w, https://www.policymed.com/wp-content/uploads/2017/04/TEVA-Using-Legitimate-Distributor-Payments-to-Conceal-Bribes-300x200.png 300w" sizes="auto, (max-width: 553px) 100vw, 553px" /></div>On December 22, 2016, the Securities and Exchange Commission (SEC) announced that Teva Pharmaceutical Industries Limited had agreed to pay more than $519 million to settle parallel civil and criminal charges that it violated the Foreign Corrupt Practices Act (FCPA) by paying bribes to foreign government officials in Russia, Ukraine, and Mexico. The interesting aspect […]]]></description> <content:encoded><![CDATA[<div style="margin-bottom:20px;"><img width="553" height="369" src="https://www.policymed.com/wp-content/uploads/2017/04/TEVA-Using-Legitimate-Distributor-Payments-to-Conceal-Bribes.png" class="attachment-post-thumbnail size-post-thumbnail wp-post-image" alt="" decoding="async" loading="lazy" srcset="https://www.policymed.com/wp-content/uploads/2017/04/TEVA-Using-Legitimate-Distributor-Payments-to-Conceal-Bribes.png 553w, https://www.policymed.com/wp-content/uploads/2017/04/TEVA-Using-Legitimate-Distributor-Payments-to-Conceal-Bribes-300x200.png 300w" sizes="auto, (max-width: 553px) 100vw, 553px" /></div><p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;"><em>On December 22, 2016, the Securities and Exchange Commission (SEC) announced that Teva Pharmaceutical Industries Limited had agreed to pay more than $519 million to settle parallel civil and criminal charges that it violated the Foreign Corrupt Practices Act (FCPA) by paying bribes to foreign government officials in Russia, Ukraine, and Mexico. The interesting aspect of this settlement is as the government alleges, the bribes were concealed in the form of legitimate payments to distributors.</em></span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">It has been a long time coming. The U.S. Department of Justice (“DOJ”) and the Securities and Exchange Commission (“SEC”) have been investigating the Israeli drug giant, Teva Pharmaceutical Industries Limited (“Teva”) for alleged Foreign Corrupt Practices Act (“FCPA”) violations since 2012. Four years later and right before Obama left office, the SEC finally announced a settlement with Teva.</span></p> <div style="height: 30px; background: #336699; width: 750px; padding: 10px 0px 4px 20px; font-family: Verdana,sans-serif; font-size: 1.2em; color: white;">To Read the Full Story, <a style="color: white;" href="http://www.lifescicompliance.com/subscription-options/"><strong>Subscribe</strong></a>, <strong>Download a <a style="color: white;" href="https://www.lifescicompliance.com/sample-issue-contact-information/">Sample Issue</a></strong>, or <a style="color: white;" href="https://www.lifescicompliance.com/login/"><strong>Sign In</strong></a></div> <div style="width: 770px;"><a href="http://www.lifescicompliance.com"><img decoding="async" class="asset asset-image at-xid-6a00e5520572bb883401b8d1c8ad6d970c image-full img-responsive" style="width: 770px;" title="PM_LSCU_Box" src="http://policymed.typepad.com/.a/6a00e5520572bb883401b8d1c8ad6d970c-800wi" alt="PM_LSCU_Box" height="253" border="0" /></a></div> ]]></content:encoded> <wfw:commentRss>https://www.policymed.com/2017/04/teva-using-legitimate-distributor-payments-to-conceal-bribes.html/feed</wfw:commentRss> <slash:comments>0</slash:comments> </item> <item> <title>Zimmer Biomet Pays $30 Million to Resolve New FCPA Charges</title> <link>https://www.policymed.com/2017/02/zimmer-biomet-pays-30-million-to-resolve-new-fcpa-charges.html</link> <comments>https://www.policymed.com/2017/02/zimmer-biomet-pays-30-million-to-resolve-new-fcpa-charges.html#respond</comments> <dc:creator><![CDATA[Thomas Sullivan]]></dc:creator> <pubDate>Thu, 02 Feb 2017 00:02:00 +0000</pubDate> <category><![CDATA[DOJ]]></category> <category><![CDATA[FCPA]]></category> <category><![CDATA[NEW]]></category> <guid isPermaLink="false">http://www.policymed.com/zimmer-biomet-pays-30-million-to-resolve-new-fcpa-charges/</guid> <description><![CDATA[<div style="margin-bottom:20px;"><img width="1024" height="576" src="https://www.policymed.com/wp-content/uploads/2017/02/6a00e5520572bb883401b8d253b83b970c.png" class="attachment-post-thumbnail size-post-thumbnail wp-post-image" alt="" decoding="async" loading="lazy" srcset="https://www.policymed.com/wp-content/uploads/2017/02/6a00e5520572bb883401b8d253b83b970c.png 1024w, https://www.policymed.com/wp-content/uploads/2017/02/6a00e5520572bb883401b8d253b83b970c-300x169.png 300w, https://www.policymed.com/wp-content/uploads/2017/02/6a00e5520572bb883401b8d253b83b970c-768x432.png 768w" sizes="auto, (max-width: 1024px) 100vw, 1024px" /></div>Medical device maker Zimmer Biomet Holdings, Inc., agreed to pay $30.5 million to resolve Department of Justice (DOJ) and Securities and Exchange Commission (SEC) investigations into the company’s “repeat” violations of the Foreign Corrupt Practices Act (FCPA). The $30.5 million is split between a criminal fine of $17.46 million and an SEC penalty of $13 […]]]></description> <content:encoded><![CDATA[<div style="margin-bottom:20px;"><img width="1024" height="576" src="https://www.policymed.com/wp-content/uploads/2017/02/6a00e5520572bb883401b8d253b83b970c.png" class="attachment-post-thumbnail size-post-thumbnail wp-post-image" alt="" decoding="async" loading="lazy" srcset="https://www.policymed.com/wp-content/uploads/2017/02/6a00e5520572bb883401b8d253b83b970c.png 1024w, https://www.policymed.com/wp-content/uploads/2017/02/6a00e5520572bb883401b8d253b83b970c-300x169.png 300w, https://www.policymed.com/wp-content/uploads/2017/02/6a00e5520572bb883401b8d253b83b970c-768x432.png 768w" sizes="auto, (max-width: 1024px) 100vw, 1024px" /></div><p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">Medical device maker Zimmer Biomet Holdings, Inc., agreed to pay $30.5 million to resolve Department of Justice (DOJ) and Securities and Exchange Commission (SEC) investigations into the company’s “repeat” violations of the Foreign Corrupt Practices Act (FCPA). The $30.5 million is split between a criminal fine of $17.46 million and an SEC penalty of $13 million (consisting of $6.5 million in disgorgement and interest and a $6.5 million penalty).</span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">Biomet entered into a <a href="https://www.justice.gov/opa/press-release/file/925171/download">deferred prosecution agreement</a> (DPA) with the DOJ, requiring them to retain an independent compliance monitor for three years, and settled the claims with the SEC through an <a href="https://www.sec.gov/litigation/admin/2017/34-79780.pdf">internal administrative order</a>, halting the need to go to court.</span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;"><strong>Previous Charges</strong></span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">Biomet first faced FCPA charges from both the DOJ and SEC in March 2012, paying nearly $23 million to settle that enforcement action. At that time, Biomet entered into a DPA with the DOJ and also retained an independent compliance monitor for three years. In 2013, Biomet learned about more potential anti-bribery violations in Brazil and Mexico and notified the monitor.</span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">Even after the 2012 DPA, according to the DOJ, Biomet “knowingly and willfully continued to use a third party distributor in Brazil known to have paid bribes to government officials on Biomet’s behalf.” In Mexico, Biomet failed to implement an adequate system of internal accounting controls at a subsidiary, “despite employees and executives having been made aware of red flags suggesting that bribes were being paid.”</span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">The 2012 enforcement action involved Biomet’s bribery of government officials in Argentina, Brazil, and China. The three-year DPA from 2012 was extended by the DOJ for another year after Biomet reported to the monitor the suspected bribery in Brazil and Mexico. At the end of that year, according to the DOJ, “the independent monitor was unable to certify that the company’s compliance program satisfied the requirements of the 2012 DPA.” In 2015, Zimmer bought Biomet in 2015 for about $14 billion, and the combined company trades on the Stock Exchange under ZBH.</span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;"><strong>Repeat Violations </strong></span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">In June 2016, the DOJ said that Biomet had breached the 2012 DPA “based on conduct in Brazil and Mexico.” Once the DOJ told Zimmer Biomet it was in breach of the 2012 DPA, the company “fully cooperated” and provided information about individuals involved in the misconduct. This agreement imposes another three-year DPA on Zimmer Biomet with an independent compliance monitor.</span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">Assistant Attorney General Leslie R. Caldwell <a href="http://blogs.wsj.com/riskandcompliance/2017/01/12/zimmer-biomet-to-pay-30-million-after-breaching-anti-bribery-deal/">said</a>, “In appropriate circumstances the department will resolve serious criminal conduct through alternative means, but there will be consequences for those companies that refuse to take these agreements seriously.”</span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">A <a href="http://blogs.wsj.com/riskandcompliance/2017/01/12/zimmer-biomet-to-pay-30-million-after-breaching-anti-bribery-deal/">statement from the company</a> said the money to be paid was previously recorded in financial statements. Chad Phipps, senior vice president, general counsel, and secretary at Zimmer Biomet, said that the company is pleased to have resolved “legacy Biomet FCPA compliance matters.” Phipps also said, “Zimmer Biomet is committed to upholding the highest ethical and legal standards in our business practices across the globe, and we look forward to continuing to integrate the legacy Biomet business operations into our robust corporate compliance program.”</span></p> ]]></content:encoded> <wfw:commentRss>https://www.policymed.com/2017/02/zimmer-biomet-pays-30-million-to-resolve-new-fcpa-charges.html/feed</wfw:commentRss> <slash:comments>0</slash:comments> </item> <item> <title>The Trump Administration: One Predictive Perspective</title> <link>https://www.policymed.com/2017/01/the-trump-administration-one-predictive-perspective.html</link> <comments>https://www.policymed.com/2017/01/the-trump-administration-one-predictive-perspective.html#respond</comments> <dc:creator><![CDATA[Thomas Sullivan]]></dc:creator> <pubDate>Fri, 20 Jan 2017 00:11:00 +0000</pubDate> <category><![CDATA[FCPA]]></category> <category><![CDATA[NEW]]></category> <guid isPermaLink="false">http://www.policymed.com/the-trump-administration-one-predictive-perspective/</guid> <description><![CDATA[<div style="margin-bottom:20px;"><img width="286" height="176" src="https://www.policymed.com/wp-content/uploads/2017/01/6a00e5520572bb883401b8d250a435970c.jpg" class="attachment-post-thumbnail size-post-thumbnail wp-post-image" alt="" decoding="async" loading="lazy" /></div>We recently had the pleasure of speaking with Michaeline Daboul, President and CEO of MediSpend, about the upcoming administration and what she portends for the future of compliance and enforcement. Ms. Daboul introduced the first open source SaaS compliance solution to the life sciences industry and has been introducing disruptive technologies in the pharmaceutical industry […]]]></description> <content:encoded><![CDATA[<div style="margin-bottom:20px;"><img width="286" height="176" src="https://www.policymed.com/wp-content/uploads/2017/01/6a00e5520572bb883401b8d250a435970c.jpg" class="attachment-post-thumbnail size-post-thumbnail wp-post-image" alt="" decoding="async" loading="lazy" /></div><p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">We recently had the pleasure of speaking with Michaeline Daboul, President and CEO of MediSpend, about the upcoming administration and what she portends for the future of compliance and enforcement. Ms. Daboul introduced the first open source SaaS compliance solution to the life sciences industry and has been introducing disruptive technologies in the pharmaceutical industry for drug development, genomics research, and compliance since 1985.</span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">With so many compliance regulations in different parts of the world, global business leaders need to understand the different laws and industry codes of conduct that they encounter on a regular basis. Compliance solutions that aggregate business data daily allow companies to manage the constant changes in laws, currency and data differences, and multiple language cross-border interactions.</span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">For life science companies, relevant and timely compliance management and monitoring is extremely important. The impending Trump administration will likely influence how companies continue to comply with US laws like the Foreign Corrupt Practices Act (FCPA), Anti-kickback and Securities and Exchange Commission (SEC) laws, not to mention the complications Brexit and changes in Italy add to the mix.</span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">We have seen an era of vigorous FCPA enforcement from roughly 2000 up to the present, with Attorneys General making prosecuting foreign bribery a significant priority and/or devoting substantial resources to the area.</span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">As someone who has been entrenched in the life sciences industry for over thirty years, she has seen her fair share of changes, and the ebbs and flows with each presidential administration and corresponding Congresses. With respect to the upcoming Trump Administration and Republican-led Congress, Ms. Daboul says, “We don’t know what is going to happen, but all signs lead to a more relaxed interpretation of the law. These laws were enacted to control and prevent corruption. Companies need to operate in an ethical manner – and organizing and aggregating the data needed to be in compliance with the many existing laws will go a long way towards preventing non-compliance and corruption.”</span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">While there is no current movement in Congress to change the FCPA, Ms. Daboul believes that President-Elect Trump may try to relax the law. She refers back to a <a href="http://video.cnbc.com/gallery/?video=3000089630&play=1,">2012 episode of CNBC’s Squawk Box</a> when Mr. Trump referenced the FCPA saying, “It’s a horrible law, and it should be changed.” He believes the FCPA inhibits US businesses from conducting business abroad in places like China, Colombia, and Brazil.</span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">Alexandra Wrage, president and founder of TRACE International, <a href="http://blogs.wsj.com/riskandcompliance/2016/11/11/some-experts-predict-fcpa-enforcement-drop-under-trump/">also believes</a> that enforcement will slow during the Trump Administration, noting that “[Mr.] Trump has championed reduced regulation and has derided the FCPA, so it seems likely that fighting corruption will be a considerably lower priority.”</span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">If Mr. Trump indeed ushers in a period of deregulation, Ms. Daboul recommends that companies around the world continue to focus on improving business process workflows, transparency between organizational stakeholders, and doing the right thing by managing end-to-end business activities with proper controls.</span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">Ms. Daboul also made sure to note that in order to do business all over the world, it is imperative to understand how to interact and operate globally – the FCPA is only one law and there are other new and forthcoming laws by which global companies need to abide.</span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;"><strong>Mr. Trump Nominates Jay Clayton</strong></span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">In early January 2017, Donald Trump nominated Jay Clayton (currently in private practice as a partner at Sullivan & Cromwell) to lead the SEC during his administration. Mr. Clayton presently represents companies in FCPA investigations.</span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">In 2011, prior to the wave of global anti-bribery cooperation, Mr. Clayton <a href="http://abovethelaw.com/2017/01/is-trump-the-end-of-fcpa-enforcement/">authored a 2011 New York City Bar Association paper</a> about the FCPA, addressing the “lasting harm to the competitiveness of U.S. regulated companies” due to the current “anti-bribery regime.” </span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">Richard Bistrong at the FCPA Blog <a href="http://www.fcpablog.com/blog/2017/1/10/is-jay-clayton-another-andrew-weissmann-lets-hope-so.html">seems to think</a> that Mr. Clayton may be another Andrew Weissman, who was appointed as Chief of the DOJ Fraud section a year ago. Prior to being appointed to that position, Weissman aggressively advocated limiting the FCPA, which led many to believe that his appointment would result in less FCPA enforcement. However, that did not happen, and instead, <a href="http://www.fcpablog.com/blog/2017/1/3/the-2016-fcpa-enforcement-index.html">led the biggest 365 days</a> in FCPA enforcement history.</span></p> ]]></content:encoded> <wfw:commentRss>https://www.policymed.com/2017/01/the-trump-administration-one-predictive-perspective.html/feed</wfw:commentRss> <slash:comments>0</slash:comments> </item> <item> <title>Teva Pharmaceutical to Pay $519 Million to Settle FCPA Charges</title> <link>https://www.policymed.com/2016/12/teva-pharmaceutical-to-pay-519-million-to-settle-fcpa-charges.html</link> <comments>https://www.policymed.com/2016/12/teva-pharmaceutical-to-pay-519-million-to-settle-fcpa-charges.html#respond</comments> <dc:creator><![CDATA[Thomas Sullivan]]></dc:creator> <pubDate>Tue, 27 Dec 2016 00:14:00 +0000</pubDate> <category><![CDATA[DOJ]]></category> <category><![CDATA[FCPA]]></category> <category><![CDATA[NEW]]></category> <guid isPermaLink="false">http://www.policymed.com/teva-pharmaceutical-to-pay-519-million-to-settle-fcpa-charges/</guid> <description><![CDATA[<div style="margin-bottom:20px;"><img width="320" height="180" src="https://www.policymed.com/wp-content/uploads/2016/12/6a00e5520572bb883401b8d24abc32970c-320wi.png" class="attachment-post-thumbnail size-post-thumbnail wp-post-image" alt="" decoding="async" loading="lazy" srcset="https://www.policymed.com/wp-content/uploads/2016/12/6a00e5520572bb883401b8d24abc32970c-320wi.png 320w, https://www.policymed.com/wp-content/uploads/2016/12/6a00e5520572bb883401b8d24abc32970c-320wi-300x169.png 300w" sizes="auto, (max-width: 320px) 100vw, 320px" /></div>Right before the holiday weekend, news broke that Teva Pharmaceutical Industries had come to an agreement to pay $519 million in a deferred prosecution agreement (DPA) and civil settlement, and a subsidiary will plead guilty after the pharma giant admitted it paid bribes to government officials in Russia, Ukraine, and Mexico. The settlement money is […]]]></description> <content:encoded><![CDATA[<div style="margin-bottom:20px;"><img width="320" height="180" src="https://www.policymed.com/wp-content/uploads/2016/12/6a00e5520572bb883401b8d24abc32970c-320wi.png" class="attachment-post-thumbnail size-post-thumbnail wp-post-image" alt="" decoding="async" loading="lazy" srcset="https://www.policymed.com/wp-content/uploads/2016/12/6a00e5520572bb883401b8d24abc32970c-320wi.png 320w, https://www.policymed.com/wp-content/uploads/2016/12/6a00e5520572bb883401b8d24abc32970c-320wi-300x169.png 300w" sizes="auto, (max-width: 320px) 100vw, 320px" /></div><p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">Right before the holiday weekend, <a href="https://www.justice.gov/opa/pr/teva-pharmaceutical-industries-ltd-agrees-pay-more-283-million-resolve-foreign-corrupt">news broke</a> that Teva Pharmaceutical Industries had come to an agreement to pay $519 million in a deferred prosecution agreement (DPA) and civil settlement, and a subsidiary will plead guilty after the pharma giant admitted it paid bribes to government officials in Russia, Ukraine, and Mexico.</span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">The settlement money is split between a criminal penalty of $283 million and an additional $236 million to settle civil charges. <a href="https://www.justice.gov/opa/pr/teva-pharmaceutical-industries-ltd-agrees-pay-more-283-million-resolve-foreign-corrupt">According to</a> Assistant Attorney General Leslie R. Caldwell, “Teva and its subsidiaries paid millions of dollars in bribes to government officials in various countries, and intentionally failed to implement a system of internal controls that would prevent bribery. Companies that compete fairly, ethically and honestly deserve a level playing field, and we will continue to prosecute those who undermine that goal.”</span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">According to the companies’ admissions, Teva executives and Teva Russia employees paid bribes to a high-ranking Russian government official intending to influence the official to use his authority to increase sales of Teva’s multiple sclerosis drug, Copaxone, in annual drug purchase auctions held by the Russian Ministry of Health. The arrangement took place at the same time the Russian government was seeking to reduce the amount spent on costly foreign pharmaceutical products, such as Copaxone. Between 2010 and 2012 (possibly even later), pursuant to an agreement with a repackaging and distribution company owned by the Russian government official, Teva earned more than $200 million in profits on Copaxone sales to the Russian government. Additionally, the Russian official earned roughly $65 million in corrupt profits through inflated profit margins granted to the official’s company.</span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">Teva also admitted to paying bribes to a senior government official within the Ukrainian Ministry of Health to influence the Ukrainian government’s approval of Teva drug registrations, which were necessary for the company to market and sell its products in the country. From 2001 to 2011, Teva paid the official a monthly fee as a “registration consultant,” also paying for travel and other things of value totaling approximately $200,000.00. In exchange for the benefits received from Teva, the official used his position and influence within the Ukrainian government to influence the registration in Ukraine of Teva products, including Copaxone.</span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">In Mexico, Teva admitted that it failed to implement an adequate system of internal accounting controls and failed to enforce the controls it had in place at its Mexican subsidiary, which allowed bribes to be paid by the subsidiary to doctors employed by the Mexican government. Teva’s Mexican subsidiary had been bribing these doctors to prescribe Copaxone since at least 2005. While Teva executives in Israel were responsible for the development of the company’s anti-corruption compliance program, they were also aware of the bribes paid to government doctors in Mexico. Nevertheless, Teva executives approved policies and procedures that they knew were not sufficient to meet the risks posed by Teva’s business and were not adequate to prevent or detect payments to foreign officials. Teva also admitted that its executives put in place managers to oversee the compliance function, but those executives were unable or unwilling to enforce the anti-corruption policies that had been put in place.</span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;"><strong>Criminal Information and Charges</strong></span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">Teva entered into a DPA in connection with <a href="https://www.justice.gov/opa/press-release/file/920236/download">a criminal information</a> filed in the Southern District of Florida on December 22, 2016. The information charged the company with one count of conspiracy to violate the anti-bribery provisions of the FCPA and one count of failing to implement adequate internal controls. The DPA also included a provision requiring Teva to pay a criminal penalty in the amount of $283,177,348. Teva also agreed to continue to cooperate with any ongoing DOJ investigations, enhance its compliance program, implement rigorous controls and retain an independent corporate compliance monitor for three years. </span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">Teva Russia signed a <a href="https://www.justice.gov/opa/press-release/file/920241/download">plea agreement</a> (subject to court approval), agreeing to plead guilty to a one-count criminal information, charging the company with conspiring to violate the anti-bribery provisions of the FCPA. The case has been assigned U.S. District Judge Kathleen M. Williams and Teva Russia’s initial court appearance is scheduled for January 12, 2017.</span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;"><strong>Securities and Exchange Commission</strong></span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">The United States Securities and Exchange Commission (SEC) <a href="https://www.sec.gov/litigation/litreleases/2016/lr23708.htm">filed a cease and desist order</a> against Teva, whereby the company agreed by pay roughly $236 million in disgorgement of profits to the SEC, including prejudgment interest. The SEC’s complaint alleges that the company made more than $214 million in illicit profits by making the influential payments to increase its market share and obtain regulatory and formulary approvals as well as favorable drug purchase and prescription decisions.</span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;"><strong>Conclusion </strong></span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">The Criminal Division’s Fraud Section <a href="https://www.justice.gov/opa/pr/teva-pharmaceutical-industries-ltd-agrees-pay-more-283-million-resolve-foreign-corrupt">reached the resolution</a> based on a variety of factors, including that Teva did not timely voluntarily self-disclose the conduct, but did cooperate with the department’s investigation after the SEC served it with a subpoena. Teva received a twenty percent discount off the low end of the United States Sentencing Guidelines fine range because of substantial cooperation and remediation. The company did not receive full cooperation credit, because, according to the DOJ, there were several issues that resulted in delays in the early stages of the investigation, including vastly overbroad attorney-client privilege assertions and failure to timely produce relevant documents.</span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">However, the announcement by the DOJ made no mention of any resolution of bribery probes that Teva <a href="http://www.timesofisrael.com/teva-bribery-settlement-raises-questions-on-argentina-romania-probes/">had previously acknowledged</a> in Argentina and Romania. According to Teva, the Argentina internal review has been closed, but still no mention of a resolution involving Romania.</span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">The Teva settlement at $519 million joins the ranks of Seimens ($800 million), Alstrom ($772 million), and KBR/Halliburton ($579 Million) as number five in the largest FCPA settlements in history.</span></p> ]]></content:encoded> <wfw:commentRss>https://www.policymed.com/2016/12/teva-pharmaceutical-to-pay-519-million-to-settle-fcpa-charges.html/feed</wfw:commentRss> <slash:comments>0</slash:comments> </item> <item> <title>AstraZeneca Pays $5.5 Million to Resolve FCPA Offenses</title> <link>https://www.policymed.com/2016/09/astrazeneca-pays-55-million-to-resolve-fcpa-offenses.html</link> <comments>https://www.policymed.com/2016/09/astrazeneca-pays-55-million-to-resolve-fcpa-offenses.html#respond</comments> <dc:creator><![CDATA[Thomas Sullivan]]></dc:creator> <pubDate>Thu, 01 Sep 2016 00:05:00 +0000</pubDate> <category><![CDATA[FCPA]]></category> <category><![CDATA[NEW]]></category> <guid isPermaLink="false">http://www.policymed.com/astrazeneca-pays-55-million-to-resolve-fcpa-offenses/</guid> <description><![CDATA[<div style="margin-bottom:20px;"><img width="320" height="108" src="https://www.policymed.com/wp-content/uploads/2016/09/6a00e5520572bb883401b7c88e1f36970b-320wi.png" class="attachment-post-thumbnail size-post-thumbnail wp-post-image" alt="" decoding="async" loading="lazy" srcset="https://www.policymed.com/wp-content/uploads/2016/09/6a00e5520572bb883401b7c88e1f36970b-320wi.png 320w, https://www.policymed.com/wp-content/uploads/2016/09/6a00e5520572bb883401b7c88e1f36970b-320wi-300x101.png 300w" sizes="auto, (max-width: 320px) 100vw, 320px" /></div>The United States Securities and Exchange Commission (SEC) has charged AstraZeneca PLC with violating the books and records and internal controls provisions of the Foreign Corrupt Practices Act. The charges stem from wholly-owned subsidiaries in China and Russia that made illegal payments to boost drug sales. China According to the SEC, AstraZeneca sales staff in […]]]></description> <content:encoded><![CDATA[<div style="margin-bottom:20px;"><img width="320" height="108" src="https://www.policymed.com/wp-content/uploads/2016/09/6a00e5520572bb883401b7c88e1f36970b-320wi.png" class="attachment-post-thumbnail size-post-thumbnail wp-post-image" alt="" decoding="async" loading="lazy" srcset="https://www.policymed.com/wp-content/uploads/2016/09/6a00e5520572bb883401b7c88e1f36970b-320wi.png 320w, https://www.policymed.com/wp-content/uploads/2016/09/6a00e5520572bb883401b7c88e1f36970b-320wi-300x101.png 300w" sizes="auto, (max-width: 320px) 100vw, 320px" /></div><p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt; text-transform: initial;">The United States Securities and Exchange Commission (SEC) has </span><a style="font-family: arial, helvetica, sans-serif; font-size: 12pt; text-transform: initial;" href="https://www.sec.gov/litigation/admin/2016/34-78730.pdf">charged</a><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt; text-transform: initial;"> AstraZeneca PLC with violating the books and records and internal controls provisions of the Foreign Corrupt Practices Act. The charges stem from wholly-owned subsidiaries in China and Russia that made illegal payments to boost drug sales.</span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;"><strong>China</strong></span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;"><a href="https://www.sec.gov/litigation/admin/2016/34-78730.pdf">According to the SEC</a>, AstraZeneca sales staff in China “made numerous improper payments in cash, gifts and other items” to doctors at state-owned healthcare providers “as incentives to purchase or prescribe AstraZeneca pharmaceuticals” from 2007 until 2010. According to the SEC, “Sales and marketing team members, including managers within various business units at AZ China, designed and implemented the improper payment schemes.”</span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">The gifts and payments were <a href="http://marketexclusive.com/heres-cause-astrazeneca-plc-nyseazns-5-5-million-regulatory-slap/25962/">allegedly spread out</a>, with some going to individual doctors and others going to hospitals or medical departments. AZ China sales staff and managers are suggested to have funded the illegal payments using fake fa piao (tax receipts). It didn’t stop there, however, AstraZeneca China <a href="https://www.sec.gov/litigation/admin/2016/34-78730.pdf">purportedly</a> worked with a “collusive travel vendor who submitted fake or inflated invoices to generate cash that could be used to funnel money” to the doctors and healthcare providers; the China staff set up bank accounts in doctors’ names.</span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">They also paid speaker fees to doctors for events which <a href="https://www.sec.gov/litigation/admin/2016/34-78730.pdf">documentation</a> contained “no meeting date, venue, subject or fees associated with the particular speaking event. … In some instances, the related speaker engagement was totally fabricated and never occurred.” </span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;"><strong>Russia</strong></span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">AstraZeneca China was not the only subsidiary to face allegations from the SEC. In <a href="http://www.channelnewsasia.com/news/business/astrazeneca-to-pay-us-5m-fine-over-china-russia-bribes/3089954.html">Russia</a>, from 2005 until 2010, AstraZeneca employees used similar tactics to make and hide illegal payments to government-employed physicians. Russian employees of AstraZeneca kept charts that recorded doctors’ names, where they practiced, and how much influence they had over purchasing decisions.</span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">The <a href="http://www.fcpablog.com/blog/2016/8/31/astrazeneca-pays-55-million-to-resolve-china-russia-fcpa-off.html">charts</a> used by AstraZeneca Russia employees showed “the manner in which they could be motivated to purchase AstraZeneca products through gifts, conference support, and other means.” According to the SEC, several levels of AstraZeneca Russia management either directed or approved the illegal gifts and payments.</span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;"><strong>AztraZeneca’s Cooperation</strong></span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">While AstraZeneca <a href="http://www.fcpablog.com/blog/2016/8/31/astrazeneca-pays-55-million-to-resolve-china-russia-fcpa-off.html">did not self-report</a> the Foreign Corrupt Practices Act violations, the company did provide “significant cooperation” to the SEC during the agency’s investigation. According to the SEC, AstraZeneca “immediately took a cooperative posture and ensured that it consistently provided complete information in a timely manner” and “voluntarily and timely disclosed information obtained during its own internal investigation.”</span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">While the investigation was open and ongoing, AstraZeneca <a href="http://www.cnbc.com/2016/08/31/astrazeneca-to-resolve-us-sec-foreign-bribery-case.html">worked to enhance</a> its internal controls and compliance programs, in part by adding compliance budgets and staff at the corporate level and in the local markets. AstraZeneca also fired some employees that were involved in the FCPA offenses and reassigned others to lower-risk positions and gave them targeted training.</span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">AstraZeneca also has since enhanced its anti-corruption training and audits, improved its policies governing interactions with healthcare providers and government officials regarding gifts, travel and entertainment, third-party engagements, meetings, congresses, and contributions.</span></p> <p><span style="font-family: arial, helvetica, sans-serif; font-size: 12pt;">In the settlement, AstraZeneca has <a href="https://www.sec.gov/litigation/admin/2016/34-78730.pdf">agreed to pay</a> $4.325 million in disgorgement, $822,000 in prejudgment interest, and a $375,000 civil penalty. As is typical, AstraZeneca settled the enforcement action without admitting or denying any wrongdoing or any of the SEC’s findings.</span></p> ]]></content:encoded> <wfw:commentRss>https://www.policymed.com/2016/09/astrazeneca-pays-55-million-to-resolve-fcpa-offenses.html/feed</wfw:commentRss> <slash:comments>0</slash:comments> </item> <item> <title>Is the Carrot Bigger Than the Stick? – The DOJ’s FCPA “Pilot Program”</title> <link>https://www.policymed.com/2016/06/is-the-carrot-bigger-than-the-stick-the-dojs-fcpa-pilot-program.html</link> <comments>https://www.policymed.com/2016/06/is-the-carrot-bigger-than-the-stick-the-dojs-fcpa-pilot-program.html#respond</comments> <dc:creator><![CDATA[Thomas Sullivan]]></dc:creator> <pubDate>Wed, 22 Jun 2016 23:55:00 +0000</pubDate> <category><![CDATA[DOJ]]></category> <category><![CDATA[FCPA]]></category> <category><![CDATA[Life Science Compliance Update]]></category> <category><![CDATA[NEW]]></category> <guid isPermaLink="false">http://www.policymed.com/is-the-carrot-bigger-than-the-stick-the-dojs-fcpa-pilot-program/</guid> <description><![CDATA[<div style="margin-bottom:20px;"><img width="207" height="151" src="https://www.policymed.com/wp-content/uploads/2016/06/6a00e5520572bb883401b7c86ea0ff970b.jpg" class="attachment-post-thumbnail size-post-thumbnail wp-post-image" alt="" decoding="async" loading="lazy" srcset="https://www.policymed.com/wp-content/uploads/2016/06/6a00e5520572bb883401b7c86ea0ff970b.jpg 207w, https://www.policymed.com/wp-content/uploads/2016/06/6a00e5520572bb883401b7c86ea0ff970b-86x64.jpg 86w" sizes="auto, (max-width: 207px) 100vw, 207px" /></div>Kurt Stitcher, Senior Compliance Consultant The U.S. Department of Justice’s FCPA Pilot Program is nominally designed to encourage voluntary self-disclosure of FCPA violations by providing more certainty around the outcome of such disclosure. The price of this “certainty” is fairly onerous, however, and the program suffers from many ambiguities and flaws that make it only […]]]></description> <content:encoded><![CDATA[<div style="margin-bottom:20px;"><img width="207" height="151" src="https://www.policymed.com/wp-content/uploads/2016/06/6a00e5520572bb883401b7c86ea0ff970b.jpg" class="attachment-post-thumbnail size-post-thumbnail wp-post-image" alt="" decoding="async" loading="lazy" srcset="https://www.policymed.com/wp-content/uploads/2016/06/6a00e5520572bb883401b7c86ea0ff970b.jpg 207w, https://www.policymed.com/wp-content/uploads/2016/06/6a00e5520572bb883401b7c86ea0ff970b-86x64.jpg 86w" sizes="auto, (max-width: 207px) 100vw, 207px" /></div><p><span style="font-family: Arial;"><em><span style="font-size: 12pt;">Kurt Stitcher, Senior Compliance Consultant</span> </em></span></p> <p><span style="color: #221e1f; font-family: Arial; font-size: 12pt;"><em>The U.S. Department of Justice’s FCPA Pilot Program is nominally designed to encourage voluntary self-disclosure of FCPA violations by providing more certainty around the outcome of such disclosure. The price of this “certainty” is fairly onerous, however, and the program suffers from many ambiguities and flaws that make it only marginally useful to Life Sciences companies when structuring compliance programs and determining the benefits of voluntary self-reporting. </em></span></p> <p><span style="color: #221e1f; font-family: Arial; font-size: 12pt;">On April 5, 2016, U.S. Assistant Attorney General Leslie Caldwell announced the roll-out of a Foreign Corrupt Practices (“FCPA”) Pilot Program designed to encourage companies to self-report potential FCPA violations. Accompanying her announcement was an “Enforcement Plan and Guidance” from Andrew Weissman, the Chief of the DOJ’s Fraud Section. The FCPA Guidance enumerates several benefits offered to companies that voluntarily disclose such violations, including reduced fines (beyond those offered under the United States Sentencing Guidelines) and the removal of any corporate monitor requirement. In the DOJ’s opinion, specifying the benefits of voluntary self-disclosure provides transparency in the process and, thus, more certainty for companies when they are deciding whether to self-report. </span></p> <p><span style="color: #221e1f; font-family: Arial; font-size: 12pt;">In exchange for these potential benefits, however, the DOJ requires (1) truly voluntary self-disclosure; (2) full cooperation with federal authorities in the ensuing investigation; and (3) rapid remediation of any flaws in the company’s compliance program.70 Moreover, these Pilot Program requirements are in addition to those imposed under the Principles of Federal Prosecution<span style="color: #e7e6e6;"> of Business Organizations set forth in the U.S. Attorneys’ Manual71 and under the U.S. Sentencing Guidelines, both of which speak to the steps that companies must…. </span></span></p> <p><a href="http://www.lifescicompliance.com/june-2016-life-science-compliance-update-2/"><span style="color: #660000; font-family: Arial; font-size: 12pt; background-color: white;">Read Full Article in the June 2016 Issue of Life Science Compliance Update</span></a></p> <div style="height: 30px; background: #336699; width: 750px; padding: 10px 0px 4px 20px; font-family: Verdana,sans-serif; font-size: 1.2em; color: white;">To Read the Full Story, <a style="color: white;" href="http://www.lifescicompliance.com/subscription-options/"><strong>Subscribe</strong></a>, <strong>Download a <a style="color: white;" href="https://www.lifescicompliance.com/sample-issue-contact-information/">Sample Issue</a></strong>, or <a style="color: white;" href="https://www.lifescicompliance.com/login/"><strong>Sign In</strong></a></div> <div style="width: 770px;"><a href="http://www.lifescicompliance.com"><img decoding="async" class="asset asset-image at-xid-6a00e5520572bb883401b8d1c8ad6d970c image-full img-responsive" style="width: 770px;" title="PM_LSCU_Box" src="http://policymed.typepad.com/.a/6a00e5520572bb883401b8d1c8ad6d970c-800wi" alt="PM_LSCU_Box" height="253" border="0" /></a></div> ]]></content:encoded> <wfw:commentRss>https://www.policymed.com/2016/06/is-the-carrot-bigger-than-the-stick-the-dojs-fcpa-pilot-program.html/feed</wfw:commentRss> <slash:comments>0</slash:comments> </item> </channel> </rss>