January 18, 2019
Typically we write about fraud enforcement and our work representing whistleblowers. But equally important to us is preventing fraud from happening (which ironically would put us out of business). To that end, we recently participated in two events focused on how companies can maintain effective compliance programs, ones that prevent fraud against the government and retaliation against whistleblowers.
Suzanne Durrell attended the Nineteenth Annual Pharmaceutical and Medical Device Compliance Congress in Washington, D.C. and spoke on the Qui Tam panel. Meanwhile, Bob Thomas’s Boston University School of Law Health Care Fraud and Abuse class took a field trip to Ironwood Pharmaceuticals in Cambridge, MA to see first-hand the challenges companies face and how to do compliance right.
The Pharma Congress was kicked off by Mary Riordan of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG), stressing the critical importance of effective compliance programs, one of the hallmarks of which is that the highest levels of the company support and are actively involved with compliance. As a model, she highlighted the recent corporate integrity agreement from our recent settlement against AmerisourceBergen. The almost 500 attendees also heard her outline HHS-OIG’s health care fraud enforcement priorities (both established and emerging risk areas) and recent important settlements (including our Mylan and AmerisourceBergenCorporation). Following her lead, a panel of distinguished Assistant U.S. Attorneys not only described the Department of Justice’s growing health care fraud enforcement resources and current priority areas, but also emphasized the key role that a good compliance program can play as a mitigating factor when a company is under investigation by the DOJ. Then the Qui Tam panel (including Ms. Durrell) shared the compliance lessons to be learned from the whistleblowers who come forward to whistleblower lawyers and the government (including in the AmerisourceBergen case) and what the panelists are seeing as emerging areas of health care fraud.
Meanwhile, Mr. Thomas was at Ironwood Pharmaceuticals, where the vast array of federal and state laws with which health care companies must comply was graphically illustrated for his law students in a chart prepared by Chief Compliance Officer Gene Hull. At Ironwood, there is a cultural commitment to compliance that makes a huge difference in how effective these programs are. Following the HHS-OIG’s advice, the tone starts at the top, where CEO Peter Hecht and General Counsel Halley Gilbert join with Gene Hull in making clear that everyone in the organization has been involved in building the business and that it needs to be “protected,” as in the adopted (with permission) slogan “Protect this House.” Sales staff are not only trained in compliance but they are also evaluated on how well they have stayed in compliance. In other words, behaving the right way gets rewarded, in contrast to the many situations we’ve seen elsewhere where pushing the envelope of compliance is what gets rewarded.
What all companies should care about, at a minimum, is the avoidance of trouble with law enforcement and/or whistleblowers. There’s an easy way to achieve this: put together a truly meaningful compliance program and stick to it. We whistleblower lawyers would actually love there to be fewer fraud cases out there–it would mean the work we’re doing is having an effect. But we notice that some companies have compliance programs that fail, and sometimes fail repeatedly. There’s no excuse for that. The OIG has provided the road map and, as the folks at Ironwood have shown, it can be done well. It can work. The risk of doing compliance in a half-hearted way is that we will be here waiting to represent the whistleblowers when the company doesn’t get it right.