Health Care Executives Targeted for Criminal Liability

In wake of many of the recent, massive pharmaceutical fraud settlements, government officials are exploring the possibility of holding pharmaceutical executives criminally liable for their company’s off-label promotion efforts. Despite the occurrence of massive settlements, many commentators and legal analysts believe they are simply the cost of doing business within the pharmaceutical industry. For this reason, further incentives are being developed to further deter fraud within pharmaceuticals.

Specifically, the FDA plans to more aggressively pursue misdemeanor prosecutions of CEOs, managers, and other executives under the “responsible corporate officer doctrine.” Under this doctrine, also known as the Parks doctrine, the FDA places affirmative duties upon corporate officers to seek out and remedy violations of the Food, Drug & Cosmetics Act, as well as to implement measures to prevent violations. A failure to exercise proper care in carrying out duties can create criminal liability. Primarily used in the 1960s and 1970s, the doctrine has since fallen out of use and is being resuscitated by the DOJ and Department of Health and Human Services to combat pharmaceutical fraud.