Thursday, March 04, 2010

FDA To Increase Criminal Prosecutions Of Execs

The pharmaceutical industry spends plenty on lawyers for all sorts of things - patent challenges, product-liability litigation, employment matters. The list is long, but it may be time to add another reason - criminal defense of executives.

Sure, there have been some big fines paid of late for such things as off-label promotions, but the FDA is now saying it will increase prosecutions of executives as part of an effort to bolster its Office of Criminal Investigations. It's not the first time FDA has made noises intended to get drug execs thinking about doing hard time.

So why the renewed vigor now? The agency is responding to a report issued today by the Government Accountability Office, which found there is little oversight of the OCI. This is the office that's responsible for probing counterfeit drugs and other criminal activities, as well as misconduct by FDA employees. But oversight is so lax that the GAO concluded the FDA "has relied largely on the OCI director to determine which aspects of OCI's operations and investigations are made known to FDA's top management." So who's in charge? Apparently not the FDA commissioner.

For instance, the OCI has six field offices across the U.S., and each office is supposed to undergo evaluation at least every three years. But the GAO found that only seven evaluations, or roughly 30 percent of those required, took place between 1996 and last August. One office has not been reviewed in more than a decade, according to the GAO report, which was undertaken at the request of Charles Grassley, the Iowa Republican on the US Senate Finance Committee who has regularly investigated drug safety issues.

The FDA is sent a more detailed response today to Grassley (see this), although the agency already agreed with the GAO findings (there is a letter at the end of the GAO report that you can read). For those looking to connect dots, the recent Senate Finance report on Avandia made a point of noting that several big drugmakers have paid huge fines for criminal violations, such as off-label promotion, and that more diligent oversight is needed to ensure consumer safety. In other words, Grassley was leaning on the FDA to get tough. But will anyone get convicted?

The FDA response (read here) says the agency will "increase the appropriate use of misdemeanor prosecutions, which allows responsible corporate officials to be held accountable and is a valuable enforcement tool." So maybe it is time to find a full-service law firm.

photo from flickr creative commons sbaker

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