The U.S. Justice Department's stepped up enforcement in the pharmaceutical industry has struck "the fear of God" in executives, a top lawyer at GlaxoSmithKline said today, addressing whether prosecutors have gone too far in building cases rooted in business conduct.
The Glaxo lawyer, Elpidio Villarreal, vice-president of global litigation at the pharmaceutical company, said the rhetoric coming out of DOJ in the last couple of years concerns the ability and intent of the government to hold accountable an executive for the person's mere position in the company.
Executives, Villarreal said, speaking generally at a panel discussion sponsored by DRI—The Voice of the Defense Bar, are now living “in fear of losing everything" not for personal conduct but for what someone else may have done.
“It does seem to be imposing an astronomical burden on a well-meaning, well-intentioned, competent executive,” Villarreal said. GlaxoSmithKline, he said, has “spent a fortune” building and strengthening what he called a “robust” corporate compliance program.
The notion that an executive who does the right thing but still could end up getting charged will foster cynicism and create a sense of distrust, Villarreal said. Both feelings, he added, could undermine the government’s legitimate interest in corporate compliance.
Still, Villarreal said the increased government scrutiny is welcomed, calling the pharmaceutical industry “vastly improved” since ten years ago.
The panel’s moderator, Jonathan Rosen, a white-collar defense partner in the Washington office of Shook, Hardy & Bacon, described what he called a “highly aggressive” enforcement environment.