Corporate compliance – time to shape up in Europe
Paul Tunnah interviews Guillaume Roussel
Cegedim Relationship Management
A tightening of regulations over the next few years will result in pharma having to demonstrate increased transparency with regards to promotional spend on healthcare stakeholders. The US has led the way in this area historically, but all eyes are now on Europe as new regulations appear on the horizon, including the UK Bribery Act and forthcoming amendments to the Association of the British Pharmaceutical Industry (ABPI) code of conduct.
The cost of getting it wrong is too great burden for any pharma company to bear – recent history has seen other big corporate such as Siemens hit with billion dollar fines for failing to adhere to the rules and pharma execs could face jail sentences for illegal promotional activities. But with such a diverse customer base across healthcare providers, payers and patients how can pharma monitor all its internal activities and avoid compliance pitfalls at such a granular level?
pharmaphorum caught up Guillaume Roussel, Vice President of Compliance Solutions EMEA at Cegedim Relationship Management, to hear his perspective on these changes. In addition to elaborating on some observations of its recent European compliance survey, he outlines some key steps pharma needs to take to implement operational compliance and how he sees a positive transformation within pharma as a result of the new regulatory landscape.
To listen to the full interview, please click on the play button below, with a shortened transcript of some edited highlights shown in print below.
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PT: Why has corporate compliance suddenly become so important for the pharma industry?
GR: Compliance regulations have existed for quite some time. However, the US regulations were reinforced in 2009 when the Department of Justice clearly said they would be investigating the pharma industry and the medical advice industry, because by nature these industries were subject to corruption. That was the first big sign to the industry that something new was coming into the equation that was more stringent than in the past. Last year, the UK decided to move ahead with a very strict Bribery Act to prevent bribery activities worldwide and there is also the recent amendment to the ABPI Code of Conduct, which invites member companies to be able to disclose spend data for speakers and consultants by 2013 based on the 2012 data. All these changes create a very stringent and increasingly demanding regulatory environment that companies have to face in Europe.
“All these changes create a very stringent and increasingly demanding regulatory environment that companies have to face in Europe.”
PT: What do you see as being so important about the current changes in compliance regulations?
GR: The new regulatory landscape will most likely dramatically change the way the industry works with healthcare providers and stakeholders. There’s a very clear signal from the regulators to streamline the interactions of the pharma industry with healthcare providers and stakeholders. The regulators and the government want to have physicians prescribing without being influenced by the industry. That’s the main motivation for these changes.
PT: How long does pharma have to implement the required changes and what is the cost of getting it wrong?
GR: The sanctions for breach of either the US Foreign Corrupt Services Act (FCPA) or the UK Bribery Act could be civil or criminal. We have seen in the past, for example, Siemens agreed to pay $1.6 billion in fine to settle a FCPA case. That was the first huge fine for bribery activities and in the coming years those type of fines will sky rocket. But there could also be individual prosecutions. We have also seen some pharma executives sentenced to jail because they were failing to implement adequate compliance measures, or because they were found guilty of bribery or corruption in their countries. In terms of timing, 2011 and 2012 will be the two years where we’ll see proper solutions and technologies being reinforced and streamlined within companies to be able to better respond to these types of regulatory requirements. The UK Bribery Act will come into effect in April 2011, the first report of the ABPI amendment is expected in 2013.
PT: What do pharma execs need to do to ensure they are compliant with the new regulations?
GR: They should get involved and communicate internally that compliance is no longer about isolated departments, but is actually very important to spread ethical behaviour to all employees facing customers and this should be spread across all divisions of the company. Most companies today have implemented some global compliance programmes but there’s a lot of education still to be done. The next thing is to be able to get into operational compliance – we’re talking about what should be done in order to have access to more transparency across the enterprise at an operational level. Today most of the pharma companies and the medical device companies are structured in a very silo oriented way, so they are functioning separately by business unit or divisions. Most of them today cannot consolidate the spend data across such a fragmented environment, in order to reconcile the expenditure of the company to a unique physician – that’s what’s required in order to have the level of visibility to respond to the growing regulatory requirements.
“We have also seen some pharma executives sentenced to jail because they were failing to implement adequate compliance measures…”
PT: How can a pharma company really track the activity from all those different customer facing groups?
GR: Most of them have implemented processes to be able to monitor and track activity in the sales and marketing area. But the challenge now is actually going beyond that and companies need to implement enterprise wide architectures, as they are asked to collect all expenditures that are made across all customer facing groups Essentially the challenge is to be able to work not solely on the silo of sales and marketing, but to be able to expand the company capabilities to aggregate spending processes across the entire company and even integrating third party vendor’s data.
PT: How do you think these new regulations will change the way pharma engages with healthcare providers and patients?
GR: Changes will come as transparency becomes effective within companies and it will definitely open up a new way of interacting with the healthcare providers. If Europe follows the US model then the spend data will be available to the public and that could dramatically change the interactions and the relationship between the pharma industry and the different stakeholders and healthcare providers. It will refine and rationalise these interactions, making them more scientific-oriented, which will definitely be for the best interest of patients. All this is happening today and will create a safer environment for the end users: the patients.
PT: What feedback do you see from people working within pharma about these regulations? Do they share your view?
GR: Yes, absolutely. People are really seeing compliance as part of their new model and are educating the field force to apply such ethics to their interaction with physicians. By educating employees and conducting appropriate training this type of culture and “compliance spirit” will spread across the companies and become part of the behaviour of the company towards the market. People see that as a very positive thing in establishing long lasting relationships with their customers.
“By applying transparency and compliance in its daily activities and interactions with its customers, the pharma industry can establish real trust with them.”
PT: Will there be an impact for the service companies that work with the industry?
GR: Absolutely, and this is why my company has been working in this area for quite some time. For years we have been helping our pharma clients to better manage the relationship with their customers, through providing CRM and our healthcare professional database. Cegedim is now investing a lot in the compliance division in order to really help and support our clients’ initiatives to be able to streamline compliant relationships with their customers.
PT: What kind of pharma industry do you think we’ll see emerge from this new world of tighter corporate and operational compliance?
GR: The pharma industry will reconnect with their customers, in my opinion. In the past what we’ve seen happening is a saturation of marketing and promotional messages. By applying transparency and compliance in its daily activities and interactions with its customers, the pharma industry can establish real trust with them. This will be achieved by integrating ethical behaviour into customer conversations, along with scientific messaging to be able to really help the physician to prescribe the drugs in a more effective way.
About the interviewee:
Guillaume Roussel is currently Vice President, Compliance Solutions EMEA and he has worked with Cegedim for the past ten years in various roles.
Guillaume began his Cegedim career supporting the creation of the international customer service organization. Additionally, Guillaume managed the launch different solutions and establishes successful partnerships with strategic global Life Science companies to ensure solution adequacy with the industry’s needs and market requirements. He then integrated the global sales team leading him to relocate to the U.S. to drive Cegedim business development within large, US based accounts. Since the merger with Dendrite, Guillaume has highly contributed to define the OneKey and Compliance offering in the U.S. and develop the business on that strategic market.
After 4 years in the U.S., Guillaume moved back to Europe in 2010 to oversee the expansion and the growth of the Cegedim Compliance offering for the EMEA region.
How will pharma respond to tighter compliance in Europe?