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The Largest FCPA Enforcement Actions Involving Healthcare Related Companies

healthcare

In large part due to the expansive FCPA enforcement theory that physicians, lab personnel and others associated with most foreign healthcare systems are “foreign officials” under the FCPA (first brought to the FCPA context in 2002 – see here for the prior post), healthcare related companies have resolved numerous FCPA enforcement actions.

This post highlights the twenty largest FCPA enforcement actions (as measured by settlement amount) involving healthcare related companies (broadly speaking pharmaceutical, medical device, life sciences, and diagnostic companies as well as those selling health related products).

As indicated by the below list, the top three enforcement actions involve foreign companies.

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Stericyle Resolves A Net $59 Million FCPA Enforcement Action

stericle

Stericycle (an Illinois based medical waste disposal company) has been under FCPA scrutiny since mid-2017 (See here).

As highlighted here, approximately two months ago the company disclosed that it had “reached agreements in principle with the DOJ and SEC.” Specifically, Stericycle disclosed:

Yesterday, the DOJ and SEC announced (here and here) a parallel FCPA enforcement action against Stericycle.

The DOJ enforcement action involved this criminal information charging Stericycle with  two counts of conspiracy to violate (1) the FCPA’s anti-bribery provisions, and (2) the FCPA’s books and records provision. The criminal charges were resolved via this deferred prosecution agreement pursuant to which Stericycle agreed to pay a net $35 million criminal penalty.

The SEC enforcement action involved this administrative order finding that Stericycle violated the FCPA’s anti-bribery, books and records, and internal controls provisions pursuant to which the company agreed to pay a net approximate $24 million in disgorgement and prejudgment interest.

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Former DOJ FCPA Unit Chief Calls On Enforcement Agencies To Consider Domestic “Safe Harbors” In FCPA Matters Involving Life Sciences And Healthcare Companies

Stokes

It is as predictable as the sun rising in the east and dogs barking.

A former DOJ or SEC enforcement official leaves the government for private practice and criticizes certain aspects of FCPA enforcement and/or make recommendations for FCPA reform.

Patrick Stokes (Gibson Dunn and the DOJ’s former FCPA Unit Chief as well as the DOJ’s principal representative at the OECD Working Group on Bribery) is the lead author of this recent article published in Health Lawyer titled “Safe Harbors (And Other Strategies) For Life Sciences And Healthcare Companies In the International Anti-Corruption Storm.”

In it, Stokes and his co-authors call on the FCPA enforcement agencies to consider domestic “safe harbors” in FCPA matters involving life sciences and healthcare companies.

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