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The Morning Risk Report: Health-Care Industry Faces Scrutiny Around Payments to Doctors
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The Office of Inspector General for the U.S. Department of Health and Human Services has issued a special fraud alert regarding the health-care industry’s longstanding practice of paying doctors to promote products. PHOTO: SAUL LOEB/AGENCE FRANCE-PRESSE/GETTY IMAGES
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Good morning. The health-care industry’s longstanding practice of paying doctors to explain and promote products is under review after the Office of Inspector General for the U.S. Department of Health and Human Services issued a rare warning.
The special fraud alert by the watchdog will prompt pharmaceutical and medical-device companies to take a hard look at the policies and controls associated with their speaker programs, compliance professionals say. The alert also may cause the industry to move away from the promotional practice altogether in the long run—a course of action the OIG appeared to endorse in its warning.
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“We want [companies] to think about whether these are a necessity, and whether they are appropriate—and whether it’s appropriate to continue with business as usual in a post-pandemic time period, when in-person meetings resume,” Gregory Demske, the OIG’s chief counsel, tells Risk & Compliance Journal’s Dylan Tokar.
In recent years, a stream of enforcement cases have underscored regulators’ concerns about the practice, which often involves small groups of physicians meeting over dinner and drinks in private rooms in restaurants or conference spaces.
Although the alert essentially advises against a long-used tactic, current and former pharmaceutical compliance executives said, it doesn’t contain any substantively new information about how companies should conduct themselves. “It’s really unusual insofar as you’ve had so much enforcement that this has been on everybody’s radar for the last two decades,” said Gary Giampetruzzi, a lawyer at Paul Hastings LLP who previously served as head of government investigations for pharmaceutical giant Pfizer Inc.
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The cotton harvest in October in China’s Xinjiang region. PHOTO: PULATI NIYAZI/SIPA ASIA/ZUMA PRESS
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The Trump administration banned imports of cotton products from China’s Xinjiang region, saying evidence suggests the products are made with the forced labor of Uighurs.
The Department of Homeland Security said that U.S. Customs and Border Protection officials would start detaining shipments containing cotton and cotton products originating from the Xinjiang Production and Construction Corps, a state-owned paramilitary organization known as XPCC. U.S. and other Western governments have criticized Beijing for human-rights abuses of the Uighurs, who are mostly Muslims.
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Iran has sent arms and dispatched paramilitary operatives to help Venezuela President Nicolás Maduro maintain his hold on power, the top U.S. military commander for Central and South America said Wednesday.
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Adm. Craig Faller, the head of the U.S. Southern Command, also says the U.S. has expended considerable effort trying to distinguish between humanitarian cargo and shipments that run afoul of international sanctions aimed at undermining Mr. Maduro’s grip on power.
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The European Union is completing regulatory plans outlining how online platforms should remove illegal content quickly and refrain from using their power to quash rivals or push their own products on their sites. The commission plans penalties for violators that include fines and possible separation of assets, according to people familiar with the matter.
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The federal judge overseeing the U.S. Justice Department’s antitrust case against Google said the two sides need to do more work in crafting rules about who will have access to sensitive information provided to the federal government by other companies.
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The Small Business Administration’s release of new information on borrowers under the Paycheck Protection Program highlights how money flowed to both mom-and-pop businesses and larger firms, and it raises questions about the agency’s ability to track key information about aid recipients.
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The Alibaba booth at a Wuzhen, China, conference on Nov. 23. Alibaba is one of the companies that could be affected by the House-passed legislation. PHOTO: ALEX PLAVEVSKI/EPA/SHUTTERSTOCK
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The House approved legislation that threatens a trading ban of shares of some Chinese companies over concerns that their audits aren’t sufficiently regulated. The bipartisan measure passed the Senate in May and could quickly become law with President Trump’s signature. Chinese companies and their auditors would have three years to comply with the inspections before a trading prohibition could take effect.
U.S. regulators are working on another proposal that could allow Chinese auditors to comply with the inspection requirement without violating their home country’s laws, which limit the sharing of information. The Securities and Exchange Commission could issue such a proposal this month, although it wouldn’t immediately take effect.
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New leadership at the Securities and Exchange Commission is expected to spur increased oversight of public-company audits, according to former regulators and auditors. SEC Chairman Jay Clayton and William Hinman, director of the regulator’s corporate finance division, plan to step down this month after about 3½ years in their roles.
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The planned investigation would be the latest probe into the government’s use of location data derived from mobile phones. PHOTO: LEONARD ORTIZ/SCNG/ZUMA PRESS
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The Department of Homeland Security’s internal watchdog said it would open an investigation into the use of mobile-phone surveillance technologies to track Americans without a warrant, the latest salvo in a debate within the U.S. government over the legality of such techniques.
The department’s inspector general told five Democratic senators that his office would initiate an audit “to determine if the Department of Homeland Security (DHS) and its components have developed, updated, and adhered to policies related to cell-phone surveillance devices,” according to a letter sent last week to Capitol Hill and shared with The Wall Street Journal.
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Nicholas Gravante Jr.’s exit follows the loss of nearly 60 partners this year at David Boies’s firm. PHOTO: BOIES SCHILLER FLEXNER
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The law firm Boies Schiller Flexner LLP is losing one of its leaders, Nicholas Gravante Jr., less than a year after the firm tapped him and another lawyer to help build a future for the firm beyond its founder, famed litigator David Boies. The impending departure of Mr. Gravante and three other partners to New York law firm Cadwalader, Wickersham & Taft LLP follows a cascade of nearly 60 partner departures from Boies Schiller this year.
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The European Central Bank’s chief economist plans to place private calls to banks and investors after the ECB’s policy meeting next week, continuing an unusual communications practice that has raised eyebrows among financiers and central-bank officials. The calls break with the central bank’s usual practice of delivering information to all market participants at the same time.
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Commissioner Stephen M. Hahn says FDA teams are working days, nights and weekends to review test data from Pfizer and BioNTech. PHOTO: GRAEME JENNINGS/PRESS POOL
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Food and Drug Administration Commissioner Stephen M. Hahn defended his agency’s vetting process for Pfizer Inc.’s Covid-19 vaccine, saying a thorough and meticulous review is needed to assure a skeptical public of the vaccine’s safety and effectiveness.
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Health-care workers face another challenge in keeping up with a recent surge in coronavirus cases: The number of people who say the virus isn’t as bad as public-health and news reports indicate, as well as those who say the virus isn’t real.
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New Jersey Gov. Phil Murphy strongly discouraged residents from traveling out of state for nonessential reasons as Covid-19 cases continued to mount in the region. Visitors and residents returning to New Jersey should quarantine for 14 days, under the state’s newest version of its travel advisory, Mr. Murphy said. New Jersey residents who travel to Pennsylvania, New York or Connecticut for work are exempt.
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