Pharmacological companies should be expected to adhere to strict marketing guidelines, given that doctors and patients rely on their information and advertising to make decisions concerning the treatment and health of their patients. There are national and international regulations, including the World Health Organization’s Ethical Criteria for Medicinal Drug Promotion that companies are expected and encouraged to follow. In the United States, additional laws address the relationship between pharmacy representatives and medical professionals, such as the False Claims Act, the Food, Drug and Cosmetic Act, anti-bribery laws, and the U.S. Foreign Corrupt Practices Act.
Pharmaceutical companies should be proactive in monitoring and preventing unethical practices by first, creating guidelines and policies that explicitly prohibit specific behavior by their representatives. There should be strong sanctions, such as termination, in the event the employee chooses to act outside the scope of these policies. Similarly, there should be an environment of rewards for employees with high standards of ethical behavior. Next, the company should create opportunities for training and guidance to ensure the highest ethical practices in pharmaceutical sales.
Companies need to create a self-regulating system to ensure that their internal audits work. Therefore, there should be a separate division or individual employee who is responsible for monitoring compliance with the laws and regulations. These divisions and employees should have a strong relationship with the executive officers or board of directors, to update them on potential risky practices and seek guidance on how to implement changes to reduce the risk.
Some common unethical practices that certain pharmaceutical companies have been engaged with are: making inaccurate claims about the safety or efficacy of their products; offering incentives to doctors to prescribe certain drugs including gifts and free samples; placing promotions and advertisements to students or social media to bypass bans on specific advertising reserved for doctors, or creating price hikes and false economies.
One major company that should have taken the need of internal auditing more seriously is Glaxo- Smith- Kline (or GSK). They were recently ordered to pay one of the largest healthcare fraud settlements in U.S. history – $3 billion in criminal and civil liabilities, including charges of promotion drugs for unapproved uses and paying kickbacks to doctors. Pharmaceutical companies can only market drugs according to what their package label says (which is approved by the FDA). Doctors can prescribe off-label drugs, but the pharmaceutical company cannot influence the decision to do this. One drug was encouraged by GSK for use in pediatric patients by doctors, by sponsoring dinners, arranging spa trips and other programs, despite the FDA warning against the use of this drug by children under the age of 18. GSK invested millions of dollars into off-label drug uses, often in spite of the FDA warnings to the latter. As a result, their failure to comply with ethical and criminal laws was a costly error.
Violations of the False Claims Acts are investigated and prosecuted by the Department of Justice. Often, the Department of Justice will send a subpoena at some point in the investigation, requesting documents and/or testimony, at which point, the company will only then begin an internal investigation to determine what the violation could be. It is most efficient to pester the government to release their suspicions as to violations under the FCA to the company so that the company can determine immediately what the issue is, and take action to rectify the behavior. Investigations can take years while the behavior subsists, resulting in potentially much greater liability to the company. A good defense attorney can help force the government’s hand before the investigation goes too far and culminates in continuous bad behavior by the company or its employees.