DOJ says to expect consent decrees like the one Ranbaxy signed as its tool of choice

Ranbaxy Laboratories had a compliance program and plenty of warning signs that there were problems at its plants before the FDA and Department of Justice got involved in an investigation that led to serious actions and a $500 million fine. It just didn't have the culture or the buy-in at all levels to fix them.

Assistant Attorney General Stuart Delery--Courtesy
Assistant Attorney General Stuart Delery--Courtesy of

That is the assessment of Assistant Attorney General Stuart Delery who told the CBI Pharmaceutical Compliance Congress Wednesday that the Department of Justice (DOJ) is more interested in "identifying nonmonetary measures," like consent decrees and corporate integrity agreements than hefty fines to prevent repeat offenses. "That is why we have put a renewed emphasis on identifying nonmonetary measures that will help us to prevent the recurrence of misconduct," Delery said, according to a copy of his speech posted on the DOJ website.

The consent decree with Ranbaxy not only meant the company had to focus on improvements--it was crafted to allow the government to rope in any other Ranbaxy plants that had issues, Regulatory Focus points out. That way, a drugmaker can't just move production from one plant to another to avoid oversight. The FDA and the DOJ invoked that provision in recent months to include two Ranbaxy plants under the 55-page consent decree that were not a part of the original agreement. One plant was added last week, after regulators found it overwriting failed inspection reports with new results.

In announcing its latest action against Ranbaxy, the FDA said the Toansa active pharmaceutical ingredient plant, like the three other banned facilities before it, will now fall under the 55-page consent decree that Ranbaxy and its parent Daiichi Sankyo agreed to in 2011. The decree outlines tight controls on manufacturing, requiring the company to bring in independent auditors to oversee its operations and to report directly to the FDA if they face any issues in doing their jobs.

While the DOJ will not back down from taking serious actions against companies when they have gone too far, Delery said he understands that the healthcare landscape is not an easy one to navigate. Most drugmakers want to do what is right and the Justice Department will give credit to those companies that voluntarily "disclose wrongdoing." Delery said the agency isn't "interested in merely collecting a large fine and moving on to the next case. We strive to give companies the incentives--and the tools--to craft better compliance practices in the future."

- here's the speech
- read more from Regulatory Focus