"Pharma/Device Enforcement: A Year in Review"

We are pleased to provide "Pharma/Device Enforcement: A Year in Review," Skadden's annual look at trends in the sector. This year's edition includes details on 2011 DOJ settlements, FDA enforcement trends, enforcement actions, compliance program developments and expectations for 2012. We welcome your feedback and suggestions on this newsletter so we can further enhance its utility.

In This Issue:

Introduction ... 1

DOJ Settlements ... 1

FDA Enforcement Trends ... 3

Individual Enforcement Actions ... 4

Compliance Program Developments ... 4

Looking Forward to 2012 ... 5

Appendices ... 7

- Introduction

Pharmaceutical and medical device companies faced another year of aggressive and increasingly coordinated enforcement actions from the Department of Justice (DOJ), Food and Drug Administration (FDA), and HHS Office of Inspector General (OIG). Although the number of federal settlements (13) against drug and device makers in 2011 decreased from the prior record-setting year, DOJ secured more than $1.4 billion in penalties and fines from industry participants.

While fewer than half (6) of this year’s settlements with pharmaceutical and device companies included a Corporate Integrity Agreement (CIA), most companies either had or now have a CIA in place. The proliferation of CIAs has created a somewhat reliable model for corporate compliance programs; in 2011, however, OIG previewed its intention to reassess the effectiveness of common CIA provisions.

FDA and DOJ obtained 21 criminal convictions across all industries under the Food, Drug and Cosmetic Act (FDCA) in 2011. In doing so, regulators reaffirmed their commitment to holding individual corporate officers accountable for alleged regulatory shortcomings — an enforcement initiative culminating in the sentencing of four former industry executives to prison.