Upload
others
View
6
Download
0
Embed Size (px)
Citation preview
© 2017 HURON CONSULTING GROUP INC.
MEASURING & MONITORING
RISK USING ANALYTICS
APRIL 13, 2017
PRESENTERS
2 © 2017 HURON CONSULTING GROUP INC.
Jack Tanselle
Managing Director
Huron Consulting Group
Jeff Fisher
Director
Huron Consulting Group
Brian Bohnenkamp
Partner
King & Spalding
TABLE OF CONTENTS
3 © 2017 HURON CONSULTING GROUP INC.
1 CURRENT LANDSCAPE 4
2 ASSESSING RISKS; DRIVING MONITORING
PLANS13
3 EVOLUTION OF COMPLIANCE ANALYTICS AND
CASE STUDIES19
4 ROADMAP FOR ESTABLISHING AGILE ANALYTIC
CAPABILITIES40
CURRENT LANDSCAPE
1
© 2017 HURON CONSULTING GROUP INC.4
RECENT LIFE SCIENCES SETTLEMENTS
5 © 2017 HURON CONSULTING GROUP INC.
Company Settlement Year Alleged Conduct
Sanofi Pasteur ~$20 million 2017 Pricing
Orthofix ~6 million 2017 FCPA Violations
Advanced BioHealing $350 million 2017 Kickbacks
Teva $519 million 2016 FCPA Violations
Forest $38 million 2016 Kickbacks
Biocompatibles $36 million 2016 Misbranding
Mylan $465 million 2016 Pricing
Novartis $16 million 2016 Off-Label Promotion
Acclarent $18 million 2016 Off-Label Promotion
Valeant/Salix $54 million 2016 Kickbacks
Genentech/OSI Pharmaceuticals $67 million 2016 Misleading Statements
Aegerion ~$40 million settlement reserve disclosed 2016 Off-Label Promotion
Pfizer/Wyeth $784 million 2016 Pricing
Olympus $646 million 2016• FCPA Violations
• Kickbacks
Novartis $390 million 2015 Kickbacks
Warner Chilcott $125 million 2015 Kickbacks
Millennium Health $256 million 2015 Kickbacks
Johnson & Johnson $25 million 2015 •GMP Violations
“Companies have spent a lot of time,
effort, and resources to comply with
open payments reporting requirements,
and I would recommend that [they]
capitalize on those investments.”
– Mary Riordan, OIG Senior Counsel,
from her Keynote Address at the
2015 Pharmaceutical Compliance
Congress
PERSPECTIVE FROM THE OIG: GROWING EMPHASIS ON KICKBACKS
Ms. Riordan went on to challenge
manufacturers:
• What types of financial relationships does
your company have with prescribers,
purchasers, or recommenders of your
products?
• Are there legitimate business needs for
those relationships?
• Are there processes and controls in place
to make sure these relationships are lawful
and don’t run afoul of kickback statutes?
6 © 2017 HURON CONSULTING GROUP INC.
TRENDING RISK AREAS
7 © 2017 HURON CONSULTING GROUP INC.
• Speaker programs
• Meals
• “Value-added services”
• Consulting arrangements
• Equipment loans
• Grants and donations
• Arrangements with specialty pharmacies
• Arrangements with PBMs and payors
• Interactions with patients and patient advocacy groups
• Coupons and co-pay cards
GROWING NUMBER OF RELEVANT AUTHORITIES TO CONSIDER IN ASSESSING POTENTIAL RISKS
8 © 2017 HURON CONSULTING GROUP INC.
• Federal– Anti-Kickback Statute
– FDA laws and regulations (e.g., advertising and promotion, clinical trials, adverse event , GMPs)
– False Claims Act
– Foreign Corrupt Practices Act
– Drug price reporting laws and regulations (e.g., Medicaid Best Price)
– Prescription Drug Marketing Act (samples)
– Executive Branch ethics laws (apply to interactions with VA and DoD)
– Open Payments/Sunshine Act
• State– State kickback prohibitions and false claims acts
– State gift bans and compliance program laws
– State transparency laws
– State consumer protection laws and restrictions on unfair trade practices
– State government ethics laws and lobbying requirements/restrictions
• Other important non-legal authorities– Industry codes of conduct (PhRMA Code, AdvaMed Code)
– Institutional conflicts of interest policies
BIG DATA ON THE SCENE . . .
9 © 2017 HURON CONSULTING GROUP INC.
• Gov’t reliance on data analytics
continues to increase
• Federal law enforcement
encouraged to use data analytics
prospectively to identify potential
fraud and abuse
• Open Payments and Medicare
Provider Utilization and Payment
Data databases available for
sophisticated analytics
. . . FOR EVERYONE TO USE
10 © 2017 HURON CONSULTING GROUP INC.
EVOLVING EXPECTATIONS FOR COMPLIANCE PROGRAMS
11 © 2017 HURON CONSULTING GROUP INC.
• Federal enforcement authorities are increasingly focused on compliance program
operational effectiveness.
• In November 2015, DOJ hired Hui
Chen, the first ever DOJ
Compliance Counsel, to provide
guidance to prosecutors on
compliance program effectiveness.
• In February 2017, DOJ published
guidelines to evaluate corporate
compliance programs.
EVOLVING EXPECTATIONS FOR COMPLIANCE PROGRAMS
12 © 2017 HURON CONSULTING GROUP INC.
• Risk Assessment and Mitigation
Process (RAMP) requirements
have become boilerplate provisions
in CIAs with HHS-OIG.
• In March 2017, OIG/HCCA
published the Resource Guide for
Measuring Compliance Program
Effectiveness.
ASSESSING RISKS; DRIVING MONITORING PLANS
2
© 2017 HURON CONSULTING GROUP INC.13
RISK ASSESSMENT AND MITIGATION PROCESS (“RAMP”)
14 © 2017 HURON CONSULTING GROUP INC.
A RAMP program is the backbone of a sustainable, effective compliance program,
creating a repeating cycle of continuous improvement through risk mitigating activity.
RISK ASSESSMENT
(annual and ad hoc)
AUDITING &
MONITORING• Traditional audits
• “For cause” audits
• Live/field monitoring
• Records reviews
• Analytics monitoringContinuous
Improvement*
Mitigation planning
driven by risk
assessment output
Mitigation output and
external forces serve as
risk assessment inputs
External Forces:
Hotline, Investigations,
Changing Regulations,
Market Conditions
*Continuous Improvement:
• Management responses
• Evolving policies and procedures
• Improved/increased training
• Improved/increased communications
• Business ownership of compliance
• Routine, integrated dialogue
RISK ASSESSMENT PROCESS
Risk Activity
Catalogue
Assess Current Controls
Risk Scoring
(prioritize)
Create A&M Plans
Re-assess Refine Repeat
Create a
catalogue of
all potential
compliance
risk activities
Include risk
categories
as well as
specific risk
areas
Assess
controls
related to
each risk
activity
Meet with
risk activity
stakeholders
to learn
needs and
concerns
Use criteria
that may
include:
current
enforcement,
current
controls,
levels of
spending,
frequency
and volume
of activity
The risk
ranking
drives
auditing and
monitoring
plans,
including
dashboards
and reports
needed
Evaluate the
progress of
mitigation
efforts
Continue
dialogue w/
stakeholders
and assess
for changes
Repeat at
least
annually
15 © 2017 HURON CONSULTING GROUP INC.
RISK ACTIVITY CATALOGUE – EXAMPLES
16 © 2017 HURON CONSULTING GROUP INC.
RISK SCORING MODELS – EXAMPLE
17
Area for Review
Current
Enforcement
Activity
Level of
Spending
Frequency
of Activity
Existing
ControlsTotal
Sales & Marketing
Speaker Programs 5 5 5 5 20
Third-Party Arrangements 5 3 5 5 18
Consulting/Ad Boards 5 3 3 3 14
Promotional Materials 3 5 0 3 11
Gifts& Business Courtesies 3 3 5 0 11
Time & Expense Reporting 3 0 0 5 8
Medium
Maximum
Minimum Minimal risk with strong corporate compliance controls 0
Current or historical enforcement action with some compliance
controls
High risk due to current enforcement action and/or high levels of
scrutiny outside the organization. Action (or inaction) may impact
multiple areas within the organization
3
5
© 2017 HURON CONSULTING GROUP INC.
RISK ASSESSMENT: CRITICAL SUCCESS FACTORS
18 © 2017 HURON CONSULTING GROUP INC.
• Risk assessments, and the mitigation plans driven by the output from them, must
be jointly developed and implemented in partnership with business leadership.
• Risk activities must be identified and scored on a relative scale for prioritization.
• Key Performance Indicators (“KPIs”) must be developed to continually measure
the effectiveness of risk-mitigation actions.
– It can be challenging to prove the effectiveness of a compliance program, given the
objective is often to try to prove a negative: “the risk-mitigation actions must be working
since the bad event hasn’t occurred.”
– The solution lies partly in a company’s ability to develop meaningful KPIs that act as
surrogates to predict the success or failure of your compliance initiatives.
EVOLUTION OF COMPLIANCE
ANALYTICS AND CASE STUDIES
3
© 2017 HURON CONSULTING GROUP INC.19
OPPORTUNITY: USING ANALYTICS FOR DECISION MAKING
• Life Sciences companies are exploring how to best create an analytics platform
that provides the following:
– Summary and detailed analysis of operational and financial data
– Algorithms to measure and visually display operational and compliance risk
– Proactive alerts that identify risk trends
– Analytic views that meet customized needs of individual business users
– Flexibility and scalability to meet needs as demands increase
20 © 2017 HURON CONSULTING GROUP INC.
BARRIERS: USING ANALYTICS FOR DECISION MAKING
• Implementing a compliance analytic and dashboard application presents
significant challenges, including:
– Identifying source systems and data elements that have relevance to measure
compliance
– Identifying measures that can display compliance risk
– Determining requirements and design for compliance management and dashboard
application
– Incorporating best practices and industry current practices, as applicable, into the
design
– Creating and maintaining required data mart and visualization application
21 © 2017 HURON CONSULTING GROUP INC.
Tools
Web-Based
Forms
Data
Aggregation
Data
Visualization
Proactive Monitoring
Characterized by:
Retrospective Monitoring
Characterized by:
Highly/
entirely
manual
processes
Random
sampling &
reporting =
limited
insights
Time,
resource, and
cost-
intensive
Resources
less focused
on action;
consumed by
process
Does the
data exist?
Can we
access it?
Is it
structured so
we can
create the
analysis we
want? How much is it
going to cost?
How long is it
going to take?
Highly/entirely
automatic
analyses &
reporting
Complete
analysis =
comprehensive
insights
Reporting &
metrics that
are time,
resource, and
cost-effective
Resources
focused on
analysis and
actionGOAL
A long-term
solution that
flexes with
your needs
Embeds
subject matter
expertise in an
automated
platform
Redundancy in
analyses
Time to
structure data
Time to
generate ad hoc
reports
Time to execute
monitoring
activities
22 © 2017 HURON CONSULTING GROUP INC.
EVOLUTION: MORE PROACTIVE & AUTOMATED
SAMPLE DATA SETS
23
Data Set Sample Analyses Examples of Business Value Stakeholders
Expense
Data
• Identification of Expense
Outliers
• Per Attendee Meal Spend vs.
Policy Requirements
• Identify total vendor spend via expense
reporting to inform negotiations
• Identify potentially excessive spenders and
take action centrally
Compliance,
Marketing,
Medical
HCP Target
List
• Appropriateness of Physician
Specialty Targeting – e.g. on-
label/off-label; NSAID Rx
volume
• Faster decisions to include/exclude HCPs
nominated by the field for detailing
• Enhanced promotional targeting (e.g. pain
specialists, rheums, GP/FP, other audiences)
• Refinement of field resource allocation
Compliance,
Sales, Sales
Operations
HCP
Consultant
Spend
• HCPs Consultant Spend vs.
Policy Cap
• Strategic allocation of HCP engagement
based on transparency to potential cap
limitations
Compliance; all
who engage
HCPs
Promotional
Programs
Attendee
List
• List of HCPs that attend
multiple programs on the
same product, with frequency
• Increase market spend efficacy by knowing
when to refrain from inviting an HCP to
multiple programs on the similar topics
Compliance,
Marketing, Sales
Operations
Clinical Trial
Data
• Annual snapshot of
compliance with FDAAA and
NIH requirements
• Sourcing potential new drug candidates
• Identify highest-enrolling sites for a given TA
Clinical,
Commercial,
Regulatory, R&D
Training
Records
• Personnel training compliance
statistics
• Increase knowledge development of company
products and practices
Compliance,
Legal/HR
© 2017 HURON CONSULTING GROUP INC.
OTHER EXAMPLES
24
Multi-Source
Analysis
Compliance Value Business Value Stakeholders
HCP Risk
Scoring
Proactively identify
inappropriate relationships
Provides full picture of
information to assess
relationship with HCP
Compliance,
Marketing,
Sales, Sales
Operations
MSL Risk
ScoringProactively identify
candidates for increased
monitoring and records
audits
Proactive monitoring of
potential risks such as off-
label promotion, kick-
backs, misbranding, etc.
may mitigate suspicion,
investigations, hefty fines,
and loss of brand value.
Compliance,
Sales, Sales
Operations
RBM Risk
Scoring
Sales Rep Risk
Scoring
Competitor
HCP Spend
Analysis
Identify spend outliers
compared to competitors
Determine whether
reallocation of spend is
necessary
Compliance,
Marketing,
Sales, Sales
Operations
© 2017 HURON CONSULTING GROUP INC.
CASE STUDY #1: OPEN PAYMENTS PEER ANALYSIS
25 © 2017 HURON CONSULTING GROUP INC.
• The commercial group wanted to gain insights into the promotional activities of their peers. The Requirement
• Commercial and Compliance collaborated on the project to ensure adherence to business goals and company policies.
• Key analytics were created to provide insights into speaker programs and HCP utilization.
The Analysis
• Compliance was able to discover key insights into peer makeup of speaker programs and HCP utilization.
The Results
COMPLIANCE MONITORING WITH OPEN PAYMENTS:Comparing HCP Utilization
26 © 2017 HURON CONSULTING GROUP INC.
Viewing how other peer companies engage HCPs that your company also utilizes
can help to identify optics seen by government and the public.
CASE STUDY #2: MEDICARE PART D TRENDS
27 © 2017 HURON CONSULTING GROUP INC.
• The compliance group wanted to gain an understanding, using publicly available data, of the prescribing patterns of the HCPs they engaged.
The Requirement
• Open Payments were analyzed in relation to Part-D data.
• Commercial and Compliance collaborated closely to ensure adherence to company policies, important in a sensitive exercise of analyzing HCP prescribing patterns.
The Analysis
• Compliance was able to identify HCPs outliers warranting further analysis due to potentially worrisome prescribing patterns.
The Results
COMPLIANCE MONITORING WITH OPEN PAYMENTS:Sales Correlated with Fee Payments
28 © 2017 HURON CONSULTING GROUP INC.
Sales information (e.g. Part-D) can be correlated with physician fee payments to
identify appearance of potential inappropriate influence.
CASE STUDY #3: SPEAKER PROGRAM MONITORING
29 © 2017 HURON CONSULTING GROUP INC.
• The compliance group wanted to track speaker program metrics in real-time. The Requirement
• Monitoring dashboards were created to provide real-time views of speaker programs, monitoring results, and investigations.
The Analysis
• Compliance was able to efficiently identify trends in speaker program policy violations resulting in a rapid response which included retraining and a shift in attendee invitation practices.
The Results
COMPLIANCE MONITORING OF SPEAKER PROGRAMSProgram Monitoring Summary
30 © 2017 HURON CONSULTING GROUP INC.
Tracking findings and corrective actions associated with monitoring Speaker
Programs figures to remain a staple activity to include in monitoring dashboards.
COMPLIANCE MONITORING SPEAKER PROGRAMSAttendee Count Distribution
31 © 2017 HURON CONSULTING GROUP INC.
Analysis of attendees can identify programs with low utilization.
CASE STUDY #4: SALES FORCE EXPENSE MONITORING
32 © 2017 HURON CONSULTING GROUP INC.
• The compliance group wanted to gain insights into the expense activity of sales reps and the organization’s association with vendors who present policy or perception risks.
The Requirement
• Analytics were created to monitor T&E expenses to identify vendors and key metrics.The Analysis
• Compliance was able to identify several risks in expense meal venues and per-person costs.The Results
COMPLIANCE MONITORING WITH CONCURTop Specialty Spending
33
Using analytics to inspect Concur expenses can identify potential HCP attendees
with inappropriate specialties.
© 2017 HURON CONSULTING GROUP INC.
CASE STUDY #5: PRICING & CONTRACTING ACCRUALS
34 © 2017 HURON CONSULTING GROUP INC.
• The Government Program group wanted reliable, repeatable, and efficient analysis of their monthly pricing and liabilities.
The Requirement
• Analytics were created to seamlessly integrate with the GP systems and processes, tailored to the organizations unique needs and variance drivers.
The Analysis
• Compliance was able to significantly reduce the burden of month- and quarter-end analysis of GP liabilities, and create informative, actionable management reports.
The Results
SAMPLE: QUARTERLY AMP SUMMARY REPORT
© 2017 HURON CONSULTING GROUP INC.35
CASE STUDY #6: CALIBRATING FAIR MARKET VALUE
36 © 2017 HURON CONSULTING GROUP INC.
• The commercial group wanted to gain insights into the compensation peers were providing to HCPs.
The Requirement
• Analytics were created to statistically analyze the distribution of payments for various types of HCP engagements, including speaking and consulting for both CME and non-CME activities.
The Analysis
• Compliance was able to identify how their own compensation compared to peers.The Results
COMPLIANCE MONITORING WITH OPEN PAYMENTSFMV of Speaker Program Payments
37 © 2017 HURON CONSULTING GROUP INC.
Open Payments data can be used to compare your speaker program payments
against peers, giving insight into your FMV range.
CASE STUDY #6: RETURN ON EDUCATION
38 © 2017 HURON CONSULTING GROUP INC.
• The commercial group wanted to move towards optimizing total spend and distribution of spend to optimize return on education investment with speaker programs.
The Requirement
• Commercial and Compliance collaborated on the project to ensure adherence to business goals and company policies.
• Key analytics were created to provide insights into speaker programs and HCP utilization.
The Analysis
• Commercial and Compliance were able to jointly agree on shifts to be made in speaker program content, speaker selection, and regional spend while enhancing risk mitigation
The Results
RETURN ON EDUCATIONEvent Location Pattern Analysis
39 © 2017 HURON CONSULTING GROUP INC.
Inputs• Product sales
• Category sales
• SPB events
Outputs• Potential for more targeted
education
• SBP overlay in a click-through
national dashboard
Implications• Resource over/underdeployment
• Restricted speaker access
environments
• Suggestion of content
requirements
ROADMAP FOR ESTABLISHING AGILE ANALYTIC CAPABILITIES
4
© 2017 HURON CONSULTING GROUP INC.40
STRATEGIC CONSIDERATIONS
• Consider your organization’s unique vision statement and goal for conducting
analyses
– For example: To identify positioning vis-a-vis competitors, and to draw insights that
inform both compliance and HCP engagement functions
• Consider a governance document to guide analytics work at your company
• Identify stakeholders across all functional areas and build consensus around
a unified team
• Evaluate internal capability to:
– Interpret analyses from both a compliance and commercial perspective
– Construct effective, informative analyses, including technology solutions
– Manage the project in a controlled manner, taking into account the numerous
stakeholder sensitivities
41 © 2017 HURON CONSULTING GROUP INC.
DETERMINE REQUIREMENTS: BUSINESS, COMPLIANCE, FUNCTIONAL AND DATA
42 © 2017 HURON CONSULTING GROUP INC.
Activity Work Steps Deliverables
Identify Business/
Functional
Requirements
• Review existing compliance policies and other documentation
• Identify business, functional, and compliance analysis requirements
• Conduct stakeholder interviews/workshops to determine functional/business
requirements
• Create analysis views for proof-of-concept application
• Create risk management algorithms
• Identify required data elements
• Evaluate completeness and accuracy of data capture and identify gaps and
solutions to remediate them
• Develop Functional Design Specification
• Develop requirements traceability matrix
• Business/Functional
Requirements
• Traceability matrix
documenting business
and regulatory
requirements
• Draft Functional
Design Specification
for Proof-of-Concept
Application
Develop and
Deploy Proof-of-
Concept
Application
• Develop data-based visualizations in accordance with the Functional Design
Specification
• Review functionality with project team
• Incorporate feedback into functionality
• Implement Proof-of Concept Application
• Updated Functional
Design Specification
• Proof-of-Concept
Application
• Identify functional, business, and compliance requirements then combine with
data requirements to help the team develop an end-to-end compliance and
dashboard application
• Specific work activities and deliverables for the requirements gathering phase
are provided in the table below.
EXAMPLE METHODOLOGY
43 © 2017 HURON CONSULTING GROUP INC.
Objective(s) Key Activities Key Deliverables
1. Create initial
designs for
visualizations and
dashboards
2. Identify source
data requirements
that will support
visualization and
dashboard
designs
1. Utilize risk assessment visualization library as a
baseline to help users describe risk visualization
requirements
2. Work with client stakeholders to identify visualization
requirements
3. Create initial designs for dashboards and
visualizations
4. Design drill-down, roll-up, and data amplification
scenarios and designs
5. Define alert criteria
6. Identify source data elements for visualizations
7. Review source systems to ensure data elements are
resident within the source systems
8. Work with client IT to create approach to capture data
elements not currently stored in source systems
• Dashboard mock-up diagrams
• Dashboard data requirements,
refresh processes, and ongoing
support recommendations
Phase I
Design/Enhance
Risk
Assessment
Process
Phase II
Determine Data
and Risk
Measures
Phase III
Design
Dashboards
and
Infrastructure
Phase IV
Replicate for
Global Rollout
THANK YOU