emerging trends in latin america · scandal include sbm offshore, saipem spa rolls-royce, and...
TRANSCRIPT
![Page 1: EMERGING TRENDS IN LATIN AMERICA · scandal include SBM Offshore, Saipem SpA Rolls-Royce, and Braskem SA Cooperation resulted in massive expansion of investigation and prosecutions,](https://reader033.vdocuments.us/reader033/viewer/2022050310/5f72833f1204a4135e7c8846/html5/thumbnails/1.jpg)
1
1
October 13, 2016
EMERGING TRENDS IN LATIN AMERICA
17th Annual Pharmaceutical & Medical Device Compliance Congress
Colleen Conry Michael CaseyPartner, Ropes & Gray LLP Counsel, Ropes & Gray LLP
![Page 2: EMERGING TRENDS IN LATIN AMERICA · scandal include SBM Offshore, Saipem SpA Rolls-Royce, and Braskem SA Cooperation resulted in massive expansion of investigation and prosecutions,](https://reader033.vdocuments.us/reader033/viewer/2022050310/5f72833f1204a4135e7c8846/html5/thumbnails/2.jpg)
2
22
� U.S. Enforcement in the Region
� Foreign Enforcement in the Region
� Risk Areas for Pharma and Medical Device Companies
� Other Factors Affecting Enforcement
� Key Themes
AGENDA
![Page 3: EMERGING TRENDS IN LATIN AMERICA · scandal include SBM Offshore, Saipem SpA Rolls-Royce, and Braskem SA Cooperation resulted in massive expansion of investigation and prosecutions,](https://reader033.vdocuments.us/reader033/viewer/2022050310/5f72833f1204a4135e7c8846/html5/thumbnails/3.jpg)
3
33
� U.S. Enforcement in the Region
� Foreign Enforcement in the Region
� Risk Areas for Pharma and Medical Device Companies
� Other Factors Affecting Enforcement
� Key Themes
AGENDA
![Page 4: EMERGING TRENDS IN LATIN AMERICA · scandal include SBM Offshore, Saipem SpA Rolls-Royce, and Braskem SA Cooperation resulted in massive expansion of investigation and prosecutions,](https://reader033.vdocuments.us/reader033/viewer/2022050310/5f72833f1204a4135e7c8846/html5/thumbnails/4.jpg)
4
4
U.S. Enforcement in the Region
� Historical attention to activities in the region
− More than 15 U.S. enforcement actions involving conduct in Brazil, Mexico, and Argentina in the past three years
− Per FCPABlog, conduct in Latin American countries covers at least 30% of all active FCPA investigations by DOJ/SEC
− High-profile nature of certain ongoing investigations only intensifies attention to the issue
![Page 5: EMERGING TRENDS IN LATIN AMERICA · scandal include SBM Offshore, Saipem SpA Rolls-Royce, and Braskem SA Cooperation resulted in massive expansion of investigation and prosecutions,](https://reader033.vdocuments.us/reader033/viewer/2022050310/5f72833f1204a4135e7c8846/html5/thumbnails/5.jpg)
5
5
U.S. Enforcement in the Region
� Regulator statements about pharma industry
– February 19, 2016: Chief of the SEC’s FCPA Unit states that the Commission’s future enforcement efforts will “[go] back to the pharma industry after a break for a period of years.”
– March 13, 2015: Director of SEC’s Enforcement Division: “Our FCPA focus obviously covers many industries…but the pharma industry is one on which we have been particularly focused in recent years.”
![Page 6: EMERGING TRENDS IN LATIN AMERICA · scandal include SBM Offshore, Saipem SpA Rolls-Royce, and Braskem SA Cooperation resulted in massive expansion of investigation and prosecutions,](https://reader033.vdocuments.us/reader033/viewer/2022050310/5f72833f1204a4135e7c8846/html5/thumbnails/6.jpg)
6
6
Regional focus Industry focus
U.S. Enforcement in the Region
![Page 7: EMERGING TRENDS IN LATIN AMERICA · scandal include SBM Offshore, Saipem SpA Rolls-Royce, and Braskem SA Cooperation resulted in massive expansion of investigation and prosecutions,](https://reader033.vdocuments.us/reader033/viewer/2022050310/5f72833f1204a4135e7c8846/html5/thumbnails/7.jpg)
7
7
U.S. Enforcement in the Region
� Olympus investigations
– Conduct in question
� Healthcare professionals at state-owned healthcare institutions designated by the company as “Key Opinion Leaders” received about $3 million in benefits, such as cash, gifts, entertainment
� Healthcare professionals were selected for benefits based on their ability to influence purchasing decisions at state-owned medical facilities, and the payments resulted in profits for Olympus totaling approximately $7.5 million
– Relevant countries
� Argentina, Bolivia, Brazil, Chile, Colombia, Costa Rica, Mexico
– Parallel enforcement with other U.S. statutes
� FCPA settlement as bookend to anti-kickback & FCA resolutions
![Page 8: EMERGING TRENDS IN LATIN AMERICA · scandal include SBM Offshore, Saipem SpA Rolls-Royce, and Braskem SA Cooperation resulted in massive expansion of investigation and prosecutions,](https://reader033.vdocuments.us/reader033/viewer/2022050310/5f72833f1204a4135e7c8846/html5/thumbnails/8.jpg)
8
8
U.S. Enforcement in the Region
� Issues in non-pharma matters in the region
− Travel & entertainment provided, directly or indirectly, for officials at state-owned companies in exchange for service contracts
� Key Energy Services
− Payments to government officials delivered through sham consulting agreements
� LATAM Airlines (formerly LAN Airlines)
![Page 9: EMERGING TRENDS IN LATIN AMERICA · scandal include SBM Offshore, Saipem SpA Rolls-Royce, and Braskem SA Cooperation resulted in massive expansion of investigation and prosecutions,](https://reader033.vdocuments.us/reader033/viewer/2022050310/5f72833f1204a4135e7c8846/html5/thumbnails/9.jpg)
9
99
� U.S. Enforcement in the Region
� Foreign Enforcement in the Region
� Risk Areas for Pharma and Medical Device Companies
� Other Factors Affecting Enforcement
� Key Themes
AGENDA
![Page 10: EMERGING TRENDS IN LATIN AMERICA · scandal include SBM Offshore, Saipem SpA Rolls-Royce, and Braskem SA Cooperation resulted in massive expansion of investigation and prosecutions,](https://reader033.vdocuments.us/reader033/viewer/2022050310/5f72833f1204a4135e7c8846/html5/thumbnails/10.jpg)
10
10
Foreign Enforcement in the Region
� Legislative infrastructure most closely resembling US/UK
– Clean Companies Act (2013)
� Active investigative environment
– Fantástico Report: Pharma and Medical Device Industries
– Operation Zealot: Tax Officials
– Opeartion Greenfield: Asset Management Industry
– Operation Mr. Hyde: Medical Device Industry
� Pharma industry & the “Judicializationof Healthcare”
– Policy debate viewed as recipe for fraudulent acquisition of therapeutic treatments
![Page 11: EMERGING TRENDS IN LATIN AMERICA · scandal include SBM Offshore, Saipem SpA Rolls-Royce, and Braskem SA Cooperation resulted in massive expansion of investigation and prosecutions,](https://reader033.vdocuments.us/reader033/viewer/2022050310/5f72833f1204a4135e7c8846/html5/thumbnails/11.jpg)
11
1111
Foreign Enforcement in the Region
� Petrobras investigation
– In March 2014, Brazilian authorities began money laundering investigation that eventually expanded into massive corruption scandal
– Alleged that Brazil’s state oil company Petrobras received improper payments for contracts using company profits
– Cooperation resulted in massive expansion of investigation and prosecutions, including numerous high-profile individuals, shaking the entire country
![Page 12: EMERGING TRENDS IN LATIN AMERICA · scandal include SBM Offshore, Saipem SpA Rolls-Royce, and Braskem SA Cooperation resulted in massive expansion of investigation and prosecutions,](https://reader033.vdocuments.us/reader033/viewer/2022050310/5f72833f1204a4135e7c8846/html5/thumbnails/12.jpg)
12
12
Foreign Enforcement in the Region
� Wave of prosecutions has had far-reaching impact – numerous Brazilian and multinational public companies implicated in corruption scandals
– Major companies that have been linked to the Petrobrasscandal include SBM Offshore, Saipem SpA Rolls-Royce, and Braskem SA
� Cooperation resulted in massive expansion of investigation and prosecutions, including numerous high-profile political officials and other individuals, shaking the entire country
![Page 13: EMERGING TRENDS IN LATIN AMERICA · scandal include SBM Offshore, Saipem SpA Rolls-Royce, and Braskem SA Cooperation resulted in massive expansion of investigation and prosecutions,](https://reader033.vdocuments.us/reader033/viewer/2022050310/5f72833f1204a4135e7c8846/html5/thumbnails/13.jpg)
13
13
Foreign Enforcement in the Region
� Legislative efforts targeting bribery and corruptio n
− Creates independent anti-corruption prosecutor
− Enhances whistleblower protections
− Streamlines cooperation across all levels of enforcement
− Increases transparency obligations of public sector officials
![Page 14: EMERGING TRENDS IN LATIN AMERICA · scandal include SBM Offshore, Saipem SpA Rolls-Royce, and Braskem SA Cooperation resulted in massive expansion of investigation and prosecutions,](https://reader033.vdocuments.us/reader033/viewer/2022050310/5f72833f1204a4135e7c8846/html5/thumbnails/14.jpg)
14
14
Foreign Enforcement in the Region
� Potential legislative changes in Argentina
– Bill under consideration would enable prosecutors to criminally charge corporations for bribery and corrupt acts
� Law 1778 in Colombia
– Imposes administrative and criminal penalties on companies and individuals who bribe public officials
– Extends liability for bribery and corruption to corporate subsidiaries and other parent company assets
![Page 15: EMERGING TRENDS IN LATIN AMERICA · scandal include SBM Offshore, Saipem SpA Rolls-Royce, and Braskem SA Cooperation resulted in massive expansion of investigation and prosecutions,](https://reader033.vdocuments.us/reader033/viewer/2022050310/5f72833f1204a4135e7c8846/html5/thumbnails/15.jpg)
15
1515
� U.S. Enforcement in the Region
� Foreign Enforcement in the Region
� Risk Areas for Pharma and Medical Device Companies
� Other Factors Affecting Enforcement
� Key Themes
AGENDA
![Page 16: EMERGING TRENDS IN LATIN AMERICA · scandal include SBM Offshore, Saipem SpA Rolls-Royce, and Braskem SA Cooperation resulted in massive expansion of investigation and prosecutions,](https://reader033.vdocuments.us/reader033/viewer/2022050310/5f72833f1204a4135e7c8846/html5/thumbnails/16.jpg)
16
16
Risk Areas for Pharma and Medical Device Companies
� Use of distributors and sub-distributors
� Customs clearance process
� Acquisition of product registrations
� Promotional concerns regarding access to unapproved drugs and devices
� Joint ventures
� Tax obligations
![Page 17: EMERGING TRENDS IN LATIN AMERICA · scandal include SBM Offshore, Saipem SpA Rolls-Royce, and Braskem SA Cooperation resulted in massive expansion of investigation and prosecutions,](https://reader033.vdocuments.us/reader033/viewer/2022050310/5f72833f1204a4135e7c8846/html5/thumbnails/17.jpg)
17
1717
� U.S. Enforcement in the Region
� Foreign Enforcement in the Region
� Risk Areas for Pharma and Medical Device Companies
� Other Factors Affecting Enforcement
� Key Themes
AGENDA
![Page 18: EMERGING TRENDS IN LATIN AMERICA · scandal include SBM Offshore, Saipem SpA Rolls-Royce, and Braskem SA Cooperation resulted in massive expansion of investigation and prosecutions,](https://reader033.vdocuments.us/reader033/viewer/2022050310/5f72833f1204a4135e7c8846/html5/thumbnails/18.jpg)
18
18
Other Factors Affecting Enforcement
� Increasing cross-border collaboration
– Embraer : US/Brazilian collaboration
– PetroTiger: US/Colombian collaboration
– Petrobras: Increased use of plea agreements
� Political unrest
![Page 19: EMERGING TRENDS IN LATIN AMERICA · scandal include SBM Offshore, Saipem SpA Rolls-Royce, and Braskem SA Cooperation resulted in massive expansion of investigation and prosecutions,](https://reader033.vdocuments.us/reader033/viewer/2022050310/5f72833f1204a4135e7c8846/html5/thumbnails/19.jpg)
19
19
Other Factors Affecting Enforcement
“The corruption itself, by most any account, is not new…. What is
new – or rather, news – is that we know about the corruption in
specific and comprehensive detail… Those once subject to little
more than resentment are now held accountable under the law.
And at least as important, other would-be perpetrators are plainly
on notice that Brazil is not what it once was.”
![Page 20: EMERGING TRENDS IN LATIN AMERICA · scandal include SBM Offshore, Saipem SpA Rolls-Royce, and Braskem SA Cooperation resulted in massive expansion of investigation and prosecutions,](https://reader033.vdocuments.us/reader033/viewer/2022050310/5f72833f1204a4135e7c8846/html5/thumbnails/20.jpg)
20
2020
� U.S. Enforcement in the Region
� Foreign Enforcement in the Region
� Risk Areas for Pharma and Medical Device Companies
� Other Factors Affecting Enforcement
� Key Themes
AGENDA
![Page 21: EMERGING TRENDS IN LATIN AMERICA · scandal include SBM Offshore, Saipem SpA Rolls-Royce, and Braskem SA Cooperation resulted in massive expansion of investigation and prosecutions,](https://reader033.vdocuments.us/reader033/viewer/2022050310/5f72833f1204a4135e7c8846/html5/thumbnails/21.jpg)
21
21
Key Themes
� Continued headlines relating to scandal and corruption have renewed calls for “clean government” across many Latin Amer ican countries
� As a result, Latin American regulators—like their counterparts in the US—are devoting significant resources to investigating allegations of corruption and fraud
� What is more, US and foreign investigative trends indicate that the pharmaceutical industry will remain a prominent tar get for enforcement efforts and that cross-border collaboration is expected to increase
![Page 22: EMERGING TRENDS IN LATIN AMERICA · scandal include SBM Offshore, Saipem SpA Rolls-Royce, and Braskem SA Cooperation resulted in massive expansion of investigation and prosecutions,](https://reader033.vdocuments.us/reader033/viewer/2022050310/5f72833f1204a4135e7c8846/html5/thumbnails/22.jpg)
22
22
22
Colleen A. ConryPartner, Ropes & Gray LLP
Washington, DC(202) 508-4834
Contact
Michael S. CaseyCounsel, Ropes & Gray LLP
Washington, DC(202) 508-4758