What the Future Holds for Compliance in the Life Sciences Industry

More than ever, the life sciences industry is under the microscope for its relationships, pricing, and practices. Sticking to a practical compliance strategy is of the utmost importance, as demonstrated by Potomac River Partners, compliance consultants for the life sciences industry, which recently released its eleventh annual year in review for 2018.


State Laws and Regulations

Last year’s headlines were dominated by news and laws related to data privacy, reducing drug prices, and addressing the opioid epidemic in the United States, according to the report. In fact, drug price transparency laws were proposed, passed, or bolstered in Oregon, Connecticut, Maine, Colorado, and Vermont. 

In addition, Tennessee became the second state to allow off-label promotion, while Massachusetts’ anti-opioid law banned manufacturers from providing copay assistance. Meanwhile, California passed the strongest data privacy law in the United States. It could conceivably serve as a template for the federal government.


Global Laws and Regulations

Transparency was top of mind around the world in 2018. British Columbia proposed transparency for HCP payments, and Colombia passed a transparency law. Also, Belgium published Sunshine data, and AstraZeneca disclosed payments to doctors in countries where it conducts business.

Europe’s long anticipated General Data Protection Regulation (GDPR) took effect in May 2018. Since its inception, others have considered similar regulations. Those in compliance in the life sciences have paid attention to enforcement.

In Greece, a prosecutor raided Novartis Athens in a bribery probe, which may involve politicians. The company also faced kickback allegations in China. Changsheng Bio-Technology received heavy penalties for the vaccine scandal in China.

Other news coming out of the country was word the China FDA would revise hundreds of device standards. The country also created a new drug regulator. In the meantime, the Dutch are investigating possible medical device inducement payments. One of the biggest stories to come out of international compliance is the fact that the International Federation of Pharmaceutical Manufacturers & Associations (IFPMA) revised its Code of Ethics.



Risk management and transparency become more important when organizations consider the high price of violations. In 2018, INSYS paid $150 million to settle a kickback investigation. Actelion settled FCA copay allegations by paying $360 million. And Amerisourcebergen doled out a whopping $625 million to settle FCA allegations and criminal liability.

Popular products, such as AbbVie’s AndroGel and Johnson & Johnson’s talc powder, also faced liability charges. These stories brought with them the need for PR damage control. AbbVie also faced legal action from the California Insurance Commissioner over alleged kickbacks related to nurse educator home visits.

Individuals Pay the Price

Last year, individuals in the life sciences faced the consequences of breaking the law. Martin Shkreli, known as the “Pharma bro,” was sentenced to 7 years in prison. Elizabeth Holmes, founder and CEO of Theranos, and the company’s COO Ramesh “Sunny” Balwani are facing charges of fraud. Both these stories dominated headlines and have been featured in news documentaries. Aside from the legal consequences, these individuals have completely destroyed their reputation and credibility. 

Drug Prices and the Opioid Epidemic

The extreme cost of medicine has posed an ethical dilemma recently. As a result, the administration of U.S. President Donald Trump has made lowering pharmaceutical drug prices a priority. The administration is asking drug makers to include prices in DTC advertisements. The government and individual organizations are questioning or even taking legal action against individual pharmaceutical companies for price hikes.

At the same time, pharmaceutical companies that had sold opioids are facing intense scrutiny over their practices as the United States continues to reel from the opioid epidemic. Trump signed the SUPPORT Act, which is comprehensive opioid legislation. The FDA is also making it easier for medical devices to get released to curb the crisis. Litigation against those organizations and individuals, who may have contributed to the epidemic, continues and will undoubtedly be part of the 2019 year in review.   

What to Expect in 2019

Potomac River Partners anticipates this year will be dominated by co-pay and patient assistance resolutions, enforcement of nurse educator conduct, drug pricing legislation, and implementation of AdvaMed and IFPMA codes. What was certain last year will be certain in the next year; transparency matters and to avoid violations, which can come in the form of hefty fines or years in prison, organizations must have an effective comprehensive compliance solution.

Tim Robinson, Esq.

Chief Legal and Privacy Officer, MediSpend

Posted on May 9, 2019 4:40:44 PM

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