FCPA AND ANTI-CORRUPTION STRATEGIES FOR THE LIFE SCIENCES INDUSTRY
R&C: To what extent is the life sciences industry susceptible to bribery and corruption? Could you provide an overview of the risks companies in this sector typically face?
Young: Life sciences companies have been one of the most regulated industries over the past 10 to 15 years, with a significant number of Foreign Corrupt Practices Act (FCPA) enforcements in total, which is on a par with aerospace and just behind industrial goods and the oil and gas sectors.
McFerran: We see a few factors potentially increasing the risk of bribery and corruption violations for multinational life sciences companies. Governments across the world increased their demands to purchase personal protective equipment (PPE), medical devices such as respirators and medicines, and in many cases have issued special regulation to bypass requirements to organise public tenders. With government agencies closed across the world due to the coronavirus (COVID-19) pandemic, companies experienced significant delays in obtaining required permits, licences and visas. Governments paid large grants to pharmaceutical companies for research and development, which are prone to corruption. Given the travel restrictions in place, companies reduced or put on hold their in-country audits of distributors and other third parties.
Oct-Dec 2022 Issue
KPMG LLP