Multi-Jurisdictional Investigation Issues

Transcription

1 4 th International Pharmaceutical Compliance Congress Berlin, Germany 18 May 2010 Multi-Jurisdictional Investigation Issues Stephen Mohr Global Compliance Officer Jonathan Kellerman Partner John Bentivoglio Gary DiBianco Partners

2 Overview Enforcement Environment Initial Steps to Respond to a Multi-Jurisdictional Investigation Employee Interviews and Disciplinary Action International Data Collection and Production Cooperation Among Multiple Regulators Strategic Issues in Resolving Multiple Investigations 2

3 Legal and Enforcement Developments 35 Resolved Enforcement Actions in 2009 Individuals Convictions (13) DPAs (2) NPAs (3) Corporate Pleas (3) Individuals Settled with SEC (4) Corporate Settled with SEC (3) 3

4 Legal and Enforcement Developments Largest FCPA Settlements in Terms of Combined Penalties $800 million Siemens(2008) $579 million Haliburton and KBR (2009) $400 million BAE(Not FCPA) (2010) $185 million Daimler AG (2010) $44.1 million Baker Hughes (2007) $32.3 million Willbros (2008) $30 million Chevron(2007) $28.5 million Titan(2005) $27.5 million Innospec (2010) $26 million VetcoGray(2007) $0 $100 $200 $300 $400 $500 $600 $700 $800 4

5 Legal and Enforcement Developments Prosecutorial focus on pharmaceutical industry Application of anti-corruption laws to interactions with HCPs Significant increase in activities by non-u.s. law enforcement agencies: U.K., Italy, Germany, Eastern Europe, Russia, China Ongoing cooperation among international regulators Streamlined information-sharing mechanisms, both formal and informal 5

6 The Initial Call PharmCo s General Counsel arrives at his office in Boston to learn that the offices of PharmCo s German subsidiary, PharmCo GmbH, have been raided by the Berlin Police and public prosecutor s office. The police are searching and seizing paper and electronic files at PharmCo GmbH and questioning PharmCo GmbH s sales director and key accounts manager. The Search Order issued by the Local Court alleges that PharmCo GmbH entered into lucrative consulting agreements with executives and physicians of state and private hospitals and that travel and gifts were provided to influence the purchase of PharmCo products. 6

7 Initial Issues Possible parallel investigations Document preservation, collection, and review Securing corporate and criminal counsel for the company Securing counsel for individuals Conducting an internal investigation 7

8 The Interviews After questioning, the Public Prosecutor's Office obtains arrest orders against the sales director and key accounts manager. The raid has not yet become public, but PharmCo is anxious to conduct its own internal investigation and approach appropriate regulators. PharmCo would like to conduct interviews with the sales director and key accounts manager, as well additional employees. However, the public prosecutor in charge informs PharmCo s criminal defense counsel to not to conduct these interviews because they could taint his investigation. 8

9 Interview and Investigation Issues Cooperation and voluntary disclosures Possible disciplinary actions against employees Managing the German investigation Communicating U.S. law enforcement concerns Negotiating interview parameters to address German law enforcement concerns Assessing possible involvement of additional regulators Assessing customer considerations 9

10 The Expanding Investigation PharmCo is working through the internal investigation issues when the Wall Street Journal publishes a story about the Berlin Public Prosecutor's Investigation. Following the report, PharmCo receives inquiries from the U.S. DOJ, HHS OIG, and SEC for a broad range of information, including correspondence, ledger data, and expense records from PharmCo GmbH. PharmCo believes that the US regulators also are in contact with the Berlin Public Prosecutor. PharmCo s Polish operation, a subsidiary of PharmCo GmbH, is contacted by public prosecutors regarding sales from Germany into Poland. 10

11 Responding to Additional Authorities Managing US regulatory expectations Jurisdictional questions Access to employee e- accounts and computer files Data Privacy directives and cross-border transmission of information Access to documents that have been seized by the Berlin police Increased chance of employee whistleblowers / cooperation with enforcement authorities 11

12 Key Strategic Issues Ongoing reporting and disclosures to authorities Strategic considerations in negotiating a global resolution with multiple regulators Considerations regarding suspension, debarment, exclusion from public programs and tenders Dealing with a monitor/remedial measures Disclosure to and cooperation with the Company s auditors: timing, tone and content 12