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DoJ: Integrity contracts avoid compliance ‘worst nightmares’

By Fiona Barry , 05-Feb-2014

(Picture credit: flickr/Peter Eimon)
(Picture credit: flickr/Peter Eimon)

The US Department of Justice is supplementing financial punishments for pharmaceutical companies violating FDA rules with corporate integrity agreements (CIAs), said the US Assistant Attorney General.

In a speech to the CBI Pharmaceutical Compliance Congress in Washington, DC last week, Stuart Delery said the Department of Justice (DoJ) was “not interested in merely collecting a large fine and moving on to the next case,” and the integrity agreements were effecting longer-term changes.

CIAs are a type of consent decree between the Department of Health and Human Services and pharmaceutical corporations, entered into after violation charges have been settled. They include non-monetary conditions, which if violated can lead to further government measures.

They typically last five years and include requirements to hire compliance officers, develop written policies, implement employee training, retain an independent organisation for annual reviews, establish confidential disclosure programmes, report relevant events and investigations, and liaise with the Office of the Inspector General about compliance activities.

‘Ground-breaking’ Ranbaxy contract

Delery told attendees a CIA had recently “allowed the FDA to move swiftly and respond forcefully when it learned of problems at yet another Ranbaxy facility.” The company’s plant in Toansa, India, received a US FDA form 483 and a manufacturing ban on January 11 2014 under a provision in a CIA signed by Ranbaxy two years previously.

Ranbaxy signed the agreement in 2012 following allegations it submitted false data to the FDA, specifically surrounding backdating of tests, not at the Toansa plant but at different Indian facilities in Paonta Sahib, Batamandi, and Dewas – claims it later admitted in May 2013 . It included a clause permitting the FDA to “order additional Ranbaxy facilities to be covered by the decree if the agency discovers through an inspection that the facility is not operating in compliance with the law.”

Compliance’s ‘Worst nightmare’

Describing the need for “non-monetary measures” as well as fines to prevent misconduct, Delery said Ranbaxy’s guilty plea in 2013 came after a period of early warnings and audits, but “its actions never translated into real change.”

The ultimate result was a $500m resolution – the largest drug safety settlement ever with a generic drug manufacturer.

The situation was “a compliance officer’s worst nightmare,” said Deleney. “It demonstrates how a company can have the tools it needs to avoid violations of law, and yet have such violations happen anyway.

Policies alone are not enough. That is why we have put a renewed emphasis on identifying non-monetary measures that will help us to prevent the recurrence of misconduct.

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