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Current Good Manufacturing Practice (CGMP) Violations

Nolan Auerbach & White are experienced Pharmaceutical Fraud Lawyers helping courageous whistleblowers.

Current Good Manufacturing Practice (“CGMP”), explained in greater, but by no means sufficient, detail in regulations promulgated by the FDA, sets the minimum standards for drug manufacturers. Designed as a quality control measure to prevent super- and sub-potency, product mix-ups, contamination, and mislabeling, the CGMP regulations outline general rules for all aspects of drug manufacture including buildings and facilities, personnel, equipment, drug components and containers, production, packaging and labeling, and record-keeping. Failure to comply with CGMP regulations renders any resulting drug product “adulterated” and the drug product and its producer subject to regulatory action. See 21 C.F.R. Parts 210 and 211.

Good Manufacturing Practice Violations

Pharmaceutical and biotech companies are required to follow the current Good Manufacturing Practices (cGMP) in order to ensure that their products meet specific FDA requirements for purity, strength, stability and quality.

The cGMP regulations for drugs and biological products contain certain minimum requirements that must be met for the methods, facilities, and controls used in manufacturing, processing, and packaging.

The United States Civil False Claims Act, 31 U.S.C. § 3729, et seq., is the government’s principle means of redressing fraud by government contractors. The Act has implications for Good Manufacturing Practice Violations (GMP violations) because the United States (funding as it does the Medicare program, the majority of state Medicaid programs, the Veterans Administration, the TRICARE program, and others) is the world’s largest purchaser of prescription medications.

Qui tam whistleblowers, have already begun bringing additional such cases to the attention of the Government. Because the False Claims Act imposes liability on any government contractor which knowingly submits false claims to the United States or which uses false documents to get a false claim paid, a pharmaceutical manufacturer which knew or was recklessly indifferent to the fact that the manufacturing process was compromised by GMP violations is in the same position as any other contractor which is required to conform to contractual or regulatory standards. The basis of liability under the False Claims Act is that false records have been generated which caused (false) claims for drugs to be paid by the United States.2 The monetary damages result because the payor (in this case, the U.S.), is potentially paying for substandard drugs due to the GMP violations – later covered up by false statements in documents required to be completed under the GMP.

It makes sense, too – the GMPs are a set of regulations, which, by their very nature, are designed to ensure that drugs are manufactured in such a way that they meet the requirements of the federal Food, Drug and Cosmetic Act as to safety and have the identity and strength and meet the purity characteristics that they purport or are represented to possess. The major federally-funded government healthcare programs, Medicare and Medicaid, operate under the express provisions that they will only pay for medical services and products that are “reasonable and necessary.” Unsafe or ineffective drug products are neither reasonable nor necessary. Accordingly, as the theory goes, the United States suffers monetary damages if Medicare and Medicaid programs pay for unsafe or less effective products. These and other federally-funded healthcare programs spend billions of dollars every year on pharmaceuticals.

False representations concerning minor or technical violations will not be the basis for FCA liability. Distribution of products that are not totally GMP compliant (but have been falsely documented to be) do not necessarily result in unsafe (or sub-potent) products. The issuance of a substantial number of violations detailed in Form FDA 483 or also Warning Letter do not necessarily lead to FCA liability. Substantial violations of the GMP, later covered up in writing, however, could very well be the basis for FCA liability. False representations about compliance with 21 CFR 211.100, (failure to follow and/or document production and process control procedures) for example, could under some circumstances raise the issue. The common thread through each violation its that he violation is severe enough so that the drug product that finally reaches the public is foreseeably substantially less safe or less effective than if the GMPs were not violated.

On October 26, 2010, the United States Department of Justice announced the settlement of the first False Claims Act case predicated on cGMP violations. In this settlement, GlaxoSmithKline pled guilty and agreed to pay $750 million to resolve criminal and civil liability regarding manufacturing deficiencies at its Puerto Rico plant. According to the government, the company’s manufacturing operations failed to ensure that its drugs were free of contamination from microorganisms. Moreover, the government alleged that the company’s manufacturing process caused one of its two-layer tablet products to split, causing the potential distribution of tablets that did not have any therapeutic effect. Lastly, the government alleged that the plant was riddled with longstanding problems of product mix-ups, which caused tablets of one drug type and strength to be commingled with tablets of another drug type and/or strength in the same bottle.

Kathleen Hawkins

Dignity Health
$37 million

Kathleen Hawkins, RN MSN, had been employed by Defendant, Catholic Healthcare West (CHW) for approximately 6 years when she decided she had had enough of trying to change the hospital system from within.

CHW, a California not-for-profit corporation that operated hospitals in California, Arizona, and Nevada, was at the time the eighth largest hospital system in the nation and the largest not-for-profit hospital provider in California.


Joe Strom

Johnson & Johnson
$184 Million

Joe Strom contacted us in 2005. We were very grateful that he did. We immediately formed an all-star legal team and a process to stop a very harmful pharmaceutical marketing strategy. It was this process we set into motion that ultimately returned hundreds of millions of dollars to the U.S. Treasury, and a portion of that, very well-deserved, into Joe’s bank account.

Joe told us a very troubling story about the off-label promotion of a pharmaceutical drug for patients who already suffered from chronic heart failure.


Bruce A. Moilan Sr.

$27 Million

Bruce Moilan was a seasoned hospital systems expert by the time he contacted our Firm. At the time he decided to file his qui tam lawsuit, he was employed by South Texas Health System as a System Director for Materials Management. In this position, he oversaw $24 million in annual purchases of supplies and equipment and helped determine budget, reduction and cost analysis throughout the contract bidding and negotiations process. His job was to insure proper implementation for purchasing, receiving and management of inventory, for McAllen Hospitals, L.P.


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