Saturday, September 26, 2009

Schering-Plough Employees Garner New Rights Under Merck Agreement With DoJ, Through At Least 2013. . . .

Last night, I uploaded the currently-operative Merck federal "plea agreement" (though, to be fair, Merck and the DoJ styled it as a more palatable "corporate integrity agreement", when each signed it in February 2008). I did so, not really to make public the need for the current US Attorney General to let the working US Attorneys (on the relevant files) handle the "judgment calls", for I have complete confidence in the current Attorney General to ensure just that happens.

No, I uploaded it primarily to be able to show -- in one convenient place -- all current Schering-Plough employees how this Merck plea agreement creates additional rights for each of you -- especially those of you in finance, government relations, government pricing, or government contracting -- at Schering-Plough, or New or Old Merck.

You see, once the reverse merger occurs, each of you who are "Covered Persons" will be governed by, and possess rights under the provisions of the Merck CIA agreement. Quoting from pages 16 and 17 of the agreement, then:

. . . .E. Disclosure Program.

Prior to the Effective Date, Merck established a multi-faceted Disclosure Program that enables individuals to raise concerns related to any potential unethical or illegal behavior associated with Federal health care programs or Merck's policies, procedures, or practices confidentially to the Office of Ethics. The Disclosure Program includes Merck's AdviceLine and Ombudsman Program, mechanisms that individuals can access and for which appropriate confidentiality is maintained.

Merck's AdviceLine is a tollfree telephone line staffed by a third-party that is available 24 hours a day, seven days a week. Merck's Ombudsman Program is staffed by individuals in the Office of Ethics.

Merck shall continue this Disclosure Program during the term of this CIA [until at least February of 2013]. Merck publicizes, and shall continue to publicize, the existence of the Disclosure Program in the Code of Conduct, the Ethical Operating Standards, through training sessions, and by posting information in prominent common areas of Merck's headquarter facilities, on Merck's intranet sites, and on Merck's external website.

The Disclosure Program emphasizes confidentiality and a nonretribution, nonretaliation policy. Merck makes and shall continue to make a preliminary, good faith inquiry into the allegations set forth in every disclosure to ensure that it obtains all necessary information to determine whether a further review should be conducted. For any disclosure that is sufficiently specific so that it reasonably: (1) permits a determination of the appropriateness of the alleged improper practice; and (2) provides an opportunity for taking corrective action, Merck conducts and shall continue to conduct an internal review of the allegations set forth in the disclosure. Merck shall ensure that proper follow-up is conducted. Disclosures made through the AdviceLine and the Ombudsman Program are investigated, as appropriate, by a designee from the Office of Ethics, who then determines the appropriate resolution in coordination with the appropriate parties, including the Compliance Officer or designee.

Merck maintains, and shall continue to maintain, a disclosure log, which includes a record and summary of each disclosure received (whether anonymous or not), the status of the respective internal reviews, and any corrective action taken in response to the internal reviews. This disclosure log shall be made available to OIG [the federal government Office of Inspector General] upon request. . . .

[And, from agreement pages 2 and 3:]

"Covered Persons" includes:

. . . .f. employees of [Schering-Plough's or] Merck's Corporate Finance Organization who are engaged in, or have responsibilities that directly support, the Covered Functions as defined below in Section II.C.5;

g. all employees of U.S. Pharmaceuticals (U.S. Pharma);

h. U.S.-based personnel who are assigned to MVID, Global Pharmaceuticals, GMFBS, or any other [Schering-Plough or] Merck divisions and who are engaged in, or have responsibilities that directly support, the Covered Functions as defined below in Section II.C.5; and

l. all contractors, subcontractors, agents, and other persons who perform Governent Pricing and Contracting Functions (as defined below in Section II.C.3) or who perform Promotional and Product Services Related Functions (as derined below in Section II.C.5) on behalf of [Schering-Plough or] Merck. . . .

"Relevant Covered Persons" includes those Covered Persons whose job responsibilities relate to Governent Pricing and Contracting Functions (as defined below in Section II.C.3) or to Promotional and Product Services Related Functions (as defined below in Section II.C.5). . . .

Be careful out there -- be very careful. . . .

[Some other time, I'll explain how much more could have been done, to add more "teeth" to this Merck version CIA agreement. Even so, suffice it to say that the Merck agreement is much tougher, by far, than the currently-operative Schering-Plough federally-mandated corporate integrity agreement. Thus, the above Merck agreement will control the conduct of the merged entity, under well-settled principals of applicable law.]

1 comment:

Anonymous said...


I do believe that I recently read on the FDA website that under certain circumstances that if there are additional violations of defrauding the FDA such as obtaining drug approvals via fraudulant means that the company is prohibited from submitting any new applications for 5 years.

Sure hope Freddy got a provision in his contract about no clawbacks.