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Would you set sail with your family without reassuring yourself that the boat is well-equipped to reach your destination safely? Probably not. Yet, time and again, we see proof that companies voyage into the global business operations with a limited view of potential compliance threats. In recent years, companies in the pharmaceuticals and life sciences industry have been hard hit by costly FCPA enforcement actions that also sink their reputations.
The Pharmaceutical Compliance Monitor offers several reasons why the industry has experienced rough seas when it comes to FCPA violations.
Given these risks, companies need to ramp up their due-diligence strategies to better manage compliance threats on the distant horizon.
In looking at recent enforcement actions, several common violations have surfaced. Last March, the SEC’s director of the Division of Enforcement Andrew Ceresney told attendees of the CBI Pharmaceutical Compliance Congress that the SEC had “…identified the following three prosecutorial trends: pay-to-prescribe schemes, bribes disguised as charitable contributions, and bribes to place drugs on the approved list or formulary.” Given these trends, companies need to reevaluate how they manage risk, particularly when using third-party agents as their representatives in foreign countries. After all, FCPA isn’t the only compliance law in play. Numerous governments have passed anti-bribery and corruption laws, including China, Japan, Canada, Brazil and the UK.
Not all risk is created equal, of course. If you were just taking a short sail around the harbor, you’d check that everyone has a life vest; If you’re planning an around-the-world voyage, you’d equip yourself with as much information and technology needed to ensure a safe trip. The same holds true for managing compliance risk. In the “What’s Missing?” eBook, we look at many facets of risk in the pharma and life sciences industry and how you can fine-tune your risk assessment and due-diligence strategy to meet any level of risk effectively.