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Internal Investigation & Compliance – Pharmaceutical Marketing & Sales Lawyers

In today’s complex business world, internal investigations, or audits, for compliance are mandatory to maintain a health company. Not only can audits strengthen a company’s relationship with its employees, but they can also foster a culture of compliance. Putting this into perspective, compliance keeps your company out of federal crosshairs.

Typically, the focus of compliance audits is narrow and defined. Nevertheless, it can cause concern among your employees. Documentation, visual inspections and employee interviews are guaranteed parts of the process. Questions about the work they perform can create internal tension among your workforce unless misunderstandings are handled correctly.

Since internal compliance is a critical aspect of running a solid business, using a third-party service with an objective view is probably best.

Understanding an Internal Investigation and Compliance Audit

Defining internal audits is helpful to understand the relationship to ensuring compliance. Whether your business is publicly held, privately owned, nonprofit or for-profit, internal reviews of operations is required on a regular basis.

Some reviews are legally required; others are simply best practices. Either way, the results can help you maintain a healthy functioning company and avoid penalties and fines due to noncompliance.

Types of Internal Compliance Audits

Basically, there are four types of internal audits. Industry, location, and, entity and regulatory requirements for your company distinguishes the type of audits you need.

• Contractual audits are designed to ensure that your company complies with customer specifications in contract requirements.
• Governmental audits are for companies – usually nonprofits – that receive grants or other types of funds that include contractual obligations.
• Industrial standards may apply to health care facilities and compliance with HIPAA regulations. Food handlers is another industry that have health regulations with constant oversight to ensure food safety standards are met.
• Risk management relates to workplace safety where compliance audits and constant monitoring are the norm.

Crimes revealed are often some form of theft or fraud. However, rarely will a company support prosecuting the employee or employee involved because they want to avoid bod publicity. If noncompliance with OSHA regulations results in severe injuries or death, a criminal charge will most likely follow.

Laws Governing Compliance Audits

Currently, there are no laws that specifically address internal compliance audits. However, a combination of these audits may fall within broader legislative guidelines. President Bush signed the Public Company Accounting Reform and Investor Protection Act of 2002 to deal with internal auditing and publicly held companies.

Internal auditing functions were greatly expanded under this Act. Senior management must sign off on all financial audits and the responsibilities of the Board of Directors increased. While financial audits are the focus of this Act, it does highlight the importance of self-policing for every company.


Penalties and punishments for violations that are uncovered by an internal compliance audit may vary based on the type of violation. Typically, when something violates the law, it will apply to civil statutes. Fines and court levied injunctions against the company are usually the resulting punishment.

For pharmacological companies, adhering to strict marketing guidelines is very important. Patients and doctors rely on the information these companies share, including advertising, to make decisions about different treatment options.

The United States has laws to address the relationship that sales representatives have with medical professionals. These include:

• Anti-bribery laws
False Claims Act
• Food, Drug and Cosmetic Act
• U.S. Foreign Corrupt Practices Act

Pharmacological companies are encouraged, as well as expected, to follow these laws.

Pharmaceutical Marketing & Sales

In addition to following specific laws, pharmaceutical companies should remain proactive in monitoring and preventing unethical practices. Having strong sanctions in place may help to prevent specific behavior by representatives that could lead to a costly violation.

A self-regulating system can also help to ensure internal compliance audits will work in favor of the company. If potentially risky practices are revealed by an audit, implementing changes to reduce those risks should occur without delay.

Hire a Strong Legal Advocate

Hiring a strong legal advocate from Spodek Law Group, PC can help you expose any issues with compliance. Even if jail time is not part of the penalty for noncompliance, you want to avoid paying hefty fines. Whether you are a pharmaceutical company or other type of company, call us today so we can begin working towards the best possible outcome for your company.

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