We spoke with Saul B. Helman, MD and Christine Longawa, CPA, CFE about major hurdles and enforcement trends facing life sciences companies in the coming years. Saul and Christine are the President and Director, respectively, of the newly formed Epsilon Life Sciences, a firm of industry experts dedicated to providing dispute, investigation, strategy and compliance insights to clients across the Life Sciences industry.
What will be the major hurdles facing the industry over the next few years?
Saul: I like to think about these things in threes, it helps focus. So right now, here are three things I am thinking about on behalf of our clients:
- Privacy—Privacy continues to be an area of increasing focus and scrutiny. For example, Epsilon Life Science’s Data Privacy team has been working with clients and counsel to evaluate the impact of the wave of Warning Letters from the California Attorney General’s Office alleging a lack of compliance with the California Consumer Privacy Act (CCPA). These allegations have included very granular assessments of privacy policies and have pressed organizations for details of the level of implementation of their privacy governance programs. Common issues include insufficient privacy policies, improper third party contracts, non-compliant consumer request processes, and uncertainty around the definition of sales of personal information and use of website cookies and adtech.
- Data Analytics—Regulators have enhanced their in-house analytics skills with capabilities to aggregate and analyze information across disparate sets of both structured and unstructured information. Compliance teams need to be equally equipped with the skills to interrogate the information their organizations generate both internally and in cloud-based systems in order to identify red flags and proactively address compliance.
- Virtual Business Practices—While the virtual environment existed before COVID-19, many companies were forced to add additional virtual processes in place at the beginning of the pandemic. Many companies added these processes quickly and they were not formalized. Now that the virtual environment is enduring longer than originally planned and will never completely go away, companies need to review these processes and ensure the appropriate controls are in place. Companies should make sure these virtual business practices are formalized and integrated into written standards, these updates should be communicated and properly trained on, plus auditing and monitoring around virtual business practices should be ongoing and codified.
What are some recent enforcement trends?
Christine:Co-pay foundation interactions have continued to be seen as an area of scrutiny and enforcement. Recent settlements not only include pharmaceutical companies, but third party charitable foundations that were alleged to be acting as a conduit to enable the pharmaceutical companies to provide kickbacks to Medicare patients and not operating independently.
Other kickback allegations also continues to be an enforcement trend (e.g., consulting services, intellectual property, practice support, meals, entertainment). Kickback allegations relate to life sciences companies of all sizes, but most notably smaller medical device companies.
What are the implications for companies given the early 2022 PhRMA Code update?
Saul: Even if companies are not members of PhRMA they still should be interested in how their policies compare against the PhRMA Code, including the most recently announced iteration related to speaker programs and meal guidelines. Certain states, such as California and Nevada, specifically call-out consistency with the PhRMA Code as a requirement to doing business in the state.
With the most recent Office of Inspector General’s Special Fraud Alert on speaker programs, recent settlements and the PhRMA Code updates should not come as a huge surprise. The practical implementation of these updates will be met with challenges. Controls should be updated, implemented and tested. For example, for the restriction on alcohol, policies should be updated, training should be provided, updated program signage and announcements should be created, and the meal cap should be reviewed to determine if it should be adjusted/reduced if alcohol is eliminated. Epsilon Life Sciences is helping guide companies through these changes so they align with company policy and can be implemented knowing the multiple scenarios that might exist (e.g., healthcare provider purchasing a glass of wine from the bar and bringing it into the program, a server forgets about the no alcohol policy and provides alcohol to a healthcare provider during a program).
Just for fun...What profession other than your own have you always wanted to attempt and why?
Saul: I have been fortunate to have had four careers already – first as a practicing physician, second as a healthcare executive, third as a pharmaceutical marketer and fourth as a compliance consultant. Despite this variety of experiences, I do still dream about a fifth career – and that is running an ice cream shop on the beach. Why? It is a role that would bring joy – joy to the customers consuming the ice cream in that environment, and joy to me, being able to be part of what will be great memories.
What is a binge-worthy show you are watching right now?
Christine: I have really enjoyed watching Ted Lasso. It’s a funny comedy about an American football coach that knows nothing about soccer sent to England to coach a professional English soccer team. The coach was hired by the new owner to get revenge on her ex-husband who loves the team. I found one of the funniest lines of Ted to be: “How many countries are in this country?”.