Trends: Two Months & Four Settlements That Have Changed Our World John T. Bentivoglio jbentivoglio@kslaw.com 202.625.5591 Copyright, King & Spalding LLP, 2008

Cautionary Notes All of the factual information discussed regarding the recent settlements is based on publicly available information None of the information shared today about identifiable companies reflects non-public or “inside” information Much of the information discussed today is based on settlement documents, complaints, DOJ statements and related materials – caution is appropriate with respect to whether these documents provide a complete, accurate, and/or fair depiction of the conduct of any company or individual The focus of this presentation is on the settlement requirements – not at the conduct giving rise to the settlements. Many of the practices and/or requirements in the settlements involve practices the companies adopted prior to the settlements.

Key Compliance Standards, Processes Pfizer DTC Advertising Content and use of detailing materials Compliance with ACCME standards Financial disclosure by speakers CME funding Authorship of manuscripts Patient testimonials Detailing practices for multiple products Prohibition on mentorships Conduct, disclosure of clinical studies Medical information letters, MSLs Reprint practices Grant review and approval Samples Lilly Promotional activities Dissemination of medical information Response to unsolicited requests for information Reprints Healthcare economic information CME and grants Payments to consultants and speakers Product samples Clinical research

Key Compliance Standards, Processes Merck Clinical trial registry Written or oral promotional claims (including regarding JV products) DTC requirements Presentation of clinical data in marketing, promotional pieces ACCME compliance, CME practices DSMB requirements Authorship of Merck-sponsored articles, manuscripts Cephalon Board oversight Management certifications Disclosure of HCP payments Notification to HCPs

Pfizer Settlement with State Attorneys General Summary $60 million to resolve civil allegations involving promotional practices Products: Bextra® and Celebrex® 33 States and the District of Columbia Investigations pursued under state consumer fraud statutes No admission of liability or wrongdoing of any kind

DTC Advertising

Dissemination of Study Results

Conduct, Funding of Clinical Trials

Continuing Medical Education Activities

Continuing Medical Education Activities (cont’d)

Medical Information, MSLs

Marketing Practices, Samples

Medical Education Grants

Medical Education Grants (cont’d)

Lilly Settlement with State Attorneys General Summary $62 million to resolve civil allegations involving promotional practices Product: Zyprexa® 32 States and the District of Columbia Investigations pursued under state consumer fraud statutes No admission of liability or wrongdoing of any kind

Promotional Slide Kits

Dissemination of Medical Information

Dissemination of Medical Info (cont’d)

Responding to Unsolicited Requests

Responding to Unsolicited Requests (cont’d)

Payments to HCPs

Samples

Clinical Studies

Cephalon Corporate Integrity Agreement Summary $425 million in fines and penalties to resolve off-label promotion allegations Misdemeanor plea under FDCA Products: Actiq®, Gabitril®, and Provigil® 5-year CIA

Compliance Program Oversight

Compliance Program Oversight (cont’d)

Management Certifications

Management Certifications (cont’d)

Reporting of HCP Payments

Notification to HCPs

We Knew Some of This Was Coming … NY AG Settlement with GSK Requiring Clinical Trial Disclosure August 26, 2004

HHS OIG Guidance April 2003

More Recently … HHS OIG Testimony on Physician- Industry Relationships February 27, 2008

Important Take-Aways Recent state settlements have established important benchmarks for pharmaceutical sales, marketing, and medical information practices Not required as a matter of law May be viewed as de facto safe harbors (i.e., if you comply with these standards, could be difficult for federal or state agencies to take action) Definitely should be considered in establishing company policies, procedures and practices Compliance issues extend beyond sales and marketing -- extending into medical affairs, clinical research Several trends are powerful -- and unlikely to abate in near term Disclosure, transparency (payments, clinical studies) Internal compliance certifications (DPAs, Cephalon) Requirement to take corrective action Board, management accountability These settlements provide insight on possible/likely future requirements … we should use them to bolster current compliance programs

Again, please remember my cautionary notes … Questions?

Biography -- John T. Bentivoglio John Bentivoglio is a partner in the firm’s Washington, D.C., office and serves as Co-Chair of the FDA/Healthcare Group. His practice focuses on assisting pharmaceutical, medical device, and biotechnology manufacturers in three broad areas: FDA and healthcare regulatory counseling, compliance program development and implementation, and representation of companies in civil and criminal investigations by federal and state law enforcement agencies. On the regulatory side, he advises companies on federal and state anti-kickback laws, FDA advertising and promotional rules, drug pricing and reporting, and Medicare reimbursement issues. He has assisted numerous companies in developing, implementing and assessing corporate compliance programs in line with U.S. Sentencing Commission and HHS Office of Inspector General Guidelines, and with state compliance program laws and regulations. And he has represented pharmaceutical and medical device manufacturers in investigations by U.S. Attorney’s Offices in Massachusetts, New York, Maryland, Philadelphia, and California. From 1997-2000, he served as Associate Deputy Attorney General and Special Counsel for Healthcare Fraud at the U.S. Department of Justice. In these capacities, he advised the Attorney General and Deputy Attorney General on national enforcement initiatives, healthcare investigation and prosecution policies, interagency coordination, and related issues. Earlier in his career, Mr. Bentivoglio served as a professional staff member to the Chairman of the U.S. Senate Committee on the Judiciary, where he handled criminal law and procedure, white-collar crime issues (including healthcare and financial fraud), and international crime and terrorism legislation. jbentivoglio@kslaw.com 202.626.5591