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PMCPA Code – can pharmaceutical companies be responsible for the actions of their corporate parent?

28/08/2018
Pharmaceutical companies rarely operate in one country, and are normally supported by an international parent company and numerous subsidiary companies around the globe. However, a parent company in another country may not appreciate the regulatory responsibilities in the UK, and may cause problems for the UK subsidiary.

Pharmaceutical companies rarely operate in one country, and are normally supported by an international parent company and numerous subsidiary companies around the globe.  However, a parent company in another country may not appreciate the regulatory responsibilities in the UK, and may cause problems for the UK subsidiary.  In this Prescription Medicines Code of Practice Authority (PMCPA) case, the actions of the US parent company led to Sunovion UK receiving a public reprimand and having to comply with ongoing audits of its compliance procedures in February, March and June 2018.

An ex-employee of Sunovion UK reported to the PMCPA (the entity which regulates the ABPI Code) that a manager at a regional meeting had encouraged staff to pressurise purchasers into prescribing its drug Latuda by suggesting that the prescribers may be sued if they did not consider all of the available options.  Sunovion investigated the report, interviewed attendees of the meeting and provided the PMCPA with a summary of these interviews stating that there was a "mixed and unclear impression" of what had been stated.  However, when the full transcripts were provided at the PMCPA's request, it became clear that the summary was inaccurate and "there was a strong possibility that [the manager] had done something wrong."

The Appeal Board questioned how this inaccuracy had arisen, and it became clear that a US parent company had been involved in deciding what information should be submitted to the PMCPA.  A UK director had been responsible for the investigation, including the interviews, and had concluded that, on the balance of probabilities, there had been a breach of the code.  However, the draft report to be disclosed to the PMCPA had been reviewed by the US parent company which, after obtaining external legal advice, decided that it was not its responsibility to prove the complaint and altered the draft report to state that the interviews gave an unclear impression, even though it had not had sight of the interview transcripts.  After seeing the revised version, the European director nevertheless stood by his original draft.  The revised version was sent to the PMCPA anyway.

Both the PMCPA Panel and Appeal Board were highly critical of Sunovion, and in particular the US parent company, but also the Japanese ultimate parent, Dainippon Sumitomo Pharma Co.  The decision highlights that the ABPI functions as a form of self-regulation, which relies "upon the provision of complete and accurate information from pharmaceutical companies".  The response provided to the PMCPA had been "deliberately inaccurate, misleading and disingenuous" and had "brought discredit upon and reduced confidence in the pharmaceutical industry".  As a result, Sunovion UK was issued with a public reprimand for providing inaccurate and misleading information to the Panel and Appeal Board and required to undergo ongoing audits of its procedures to comply with the Code from the PMCPA.

While international operations will often bring economies of scale and help to keep sight of and manage local risks by deploying advice from a central team, this case serves as a warning that the actions of a global HQ can result in regulatory findings against a sister company elsewhere.  In particular, not all jurisdictions have the same recognition of self-regulatory systems.  UK counsel to such companies will need to ensure that any international counsel involved understand the importance of the obligations of self-regulation and, even if it is not a formal legal procedure, the requirements should be taken equally seriously to avoid penalties and regulatory damage in that local jurisdiction.

Case from April 2018

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