Food and Drug Law Institute's Food and Drug Policy Forum, Vol. 2, No. 20, pp. 1-18, 2012
23 Pages Posted: 20 Nov 2012
Date Written: October 24, 2012
Despite the imposition of increasingly substantial fines and recently successful efforts to impose individual liability on corporate executives under the Park doctrine, punishing pharmaceutical companies and their executives for unlawful promotional activities has not been as successful in achieving compliance with the Federal Food, Drug, and Cosmetic Act (FD&C Act) as the protection of the public health demands. Over the past decade, the Food and Drug Administration (FDA) and the Department of Justice (DOJ) have shifted their focus from correction and compliance to a more punitive model when it comes to allegedly unlawful promotion of pharmaceuticals. The shift initially focused on imposing monetary penalties and was arguably justified by the expectation that financial punishment would achieve a level of compliance that would reduce the need for correction. By exacting enormous fines from companies, the agencies presumably hoped that the costs associated with unlawful promotion would be too high to justify the monetary benefits of non-compliance. Unfortunately, however, that approach has not been entirely successful. Despite the growth in settlements and penalties, and the recent efforts to hold individual executives liable for corporate misbehavior, the intended impact of substantially increased compliance has only partially materialized. The upward spiraling of settlement amounts and the trend toward prosecuting repeat offenders indicate that a change in approach is necessary.
This article argues that FDA and DOJ cannot justify a continued emphasis on punishment without more demonstrable improvement in compliance and corporate accountability.
The article goes on to describe several proposals to refocus the agencies’ efforts to effectively address the impact of unlawful promotion on public health by returning to an approach that emphasizes the more traditional goals of correction and compliance. It also argues that any meaningful protection of the public health ultimately requires a broader public understanding of the issues surrounding unlawful promotion of pharmaceutical products and greater participation by patients; physicians; health care professionals; and others with an interest in, and the opportunity to, impact this area. Increasing the public’s ability and interest in monitoring companies’ promotional activities at every level will reinforce the benefits of compliance, which will better serve the public health goals of the FD&C Act.
Keywords: drug pharmaceutical promotion, claims, FDA, DOJ, False Claims Act
JEL Classification: K30, K32, K39
Suggested Citation: Suggested Citation
Girard, Vicki W., Reducing Unlawful Prescription Drug Promotion: Is the Public Health Being Served by an Enforcement Approach that Focuses on Punishment? (October 24, 2012). Food and Drug Law Institute's Food and Drug Policy Forum, Vol. 2, No. 20, pp. 1-18, 2012; Georgetown Public Law Research Paper No. 12-185; Georgetown Law and Economics Research Paper No. 12-041. Available at SSRN: https://ssrn.com/abstract=2178041