CALIFORNIA COMPLIANCE POLICY AND DECLARATION
NOTICE: this information is provided pursuant to the requirements of Cal. Health & Safety Code § 119402 (S.B. 1765), which requires certain pharmaceutical and medical device companies doing business in California to make available their program for compliance with applicable federal and state laws and industry standards regulating the marketing and promotion of their products.
1. Written Standards
Akorn, Inc. has developed a Corporate Compliance Policy and Procedures Manual containing several policies and procedures regarding appropriate interactions with Health Care Professionals ("HCPs") consistent with "Compliance Program Guidance for Pharmaceutical Manufacturers," developed by the United States Department of Health and Human Services Office of Inspector General (OIG). Hereafter, the policies and procedures in Akorn, Inc.'s Corporate Compliance Policy and Procedures Manual shall be referred to as "Compliance Program".
This Compliance Program has been implemented at the direction of the Board of Directors of Akorn, Inc. and applies to all employees and agents of Akorn or one of its wholly-owned subsidiaries (collectively, the "Company" or "Akorn").
Annual Spending Limit
For purposes of complying with the California Health and Safety Code 119402, Akorn has established a maximum annual aggregate dollar limit of $2,000 for gifts, promotional materials or activities provided to California health care professionals.
The annual spending limit does not apply to the following:
2. Compliance Officer
- Drug samples given to physicians and other HCPs intended for free distribution to patients
- Financial support for continuing medical education forums
- Financial support for health educational scholarships
- Payments for legitimate professionals services, including, but not limited to consulting
Akorn has designated a Compliance Officer to implement and oversee the Compliance Program as a priority of the Company to ensure employee compliance with the Company's commitment to lawful conduct of its business. The Compliance Officer will report to the Board of Directors no less than on an annual basis, or as otherwise deemed appropriate by the Compliance Officer and the Board of Directors.
3. Education and Training
The Compliance Officer in coordination with the Human Resources Department shall distribute the Company Corporate Compliance Policy and Procedures Manual to each employee upon their employment or as soon as practicable thereafter.
The Compliance Officer will, in consultation and coordination with other personnel of the Company, arrange for compliance training sessions or programs for all employees. Every employee shall attend or participate in the required sessions/programs, which requirement shall not be less than one such session or program per annum. The Compliance Officer will maintain or cause to be maintained records of attendance at compliance training sessions.
The Compliance Officer will direct to be posted at each Akorn facility a notice that:
4. Lines of Communication
- states the Company's commitment to comply with all applicable laws set forth in the Corporate Compliance Program Policy and Procedure Manual;
- designates the Compliance Officer to receive any reports of misconduct or unlawful conduct relating to the Company's operations or practices of which any employee may have knowledge, whether committed by an employee of the Company, an employee of another company or organization, an employee of a governmental agency, or any other person;
- states that no employee will suffer any penalty or retribution for the act of reporting, in good faith, any known or reasonably suspected unlawful conduct or misconduct involving the Company;
- requires employees to report known or reasonably suspected unlawful, conduct or misconduct involving the Company;
- states that the Company will investigate all such reports, and that any Company employee found to have engaged in unlawful conduct involving the Company will be subject to appropriate treatment, up to and including dismissal; and
- states that the Compliance Officer is available for consultation with the Company employees concerning the application of the Company's operations or practices or applicable law.
All Company employees are required to report all known or suspected instances of unlawful conduct, violations of applicable law or violations of the Compliance Program.
Anonymous reports can be submitted to either:
The Toll-Free Hotline
US: US: 1-855-832-7264
India: 000-117; when prompted, dial 855-832-7264
Switzerland: 0-800-890011; when prompted, dial 855-832-7264
The Website (http://www.akorn.ethicspoint.com)
Any employee who, in good faith, reports any improprieties or misconduct shall not suffer retribution for the act of good faith reporting.
5. Auditing and Monitoring
The Compliance Officer is responsible for establishing procedures or process for internal non-financial audits to promote compliance with applicable laws, regulations and standards of conduct (other than those relating to financial matters).
The Chief Financial Officer of Akorn will be responsible for ensuring the conduct of an annual financial audit to promote compliance with applicable laws, regulations and standards of conduct relating to financial matters.
Summaries of all internal and outside audits relating to compliance with laws, regulations, or standards of conduct (whether financial or non-financial) shall be provided to the Compliance Officer or the Chief Financial Officer, as appropriate, and to the Board of Directors.
6. Responding to Potential Violations
The Compliance Officer will ensure that good faith reports of unlawful conduct relating to the Company's operations or practices are duly investigated. The Corporate Compliance Officer and the CEO will invite appropriate members of management to participate, as necessary and appropriate, in investigations and the formation of action plans and decisions on discipline.
An investigation file will be opened on all reports made in good faith and will appropriately investigate such reports. The Company will use reasonable efforts to protect the confidentiality of the reporting person.
7. Corrective Action Procedures
If evidence of a violation exists, the Compliance Officer will recommend an appropriate course of action to management. The Compliance Officer will relate the outcome of investigations and actions taken to the Board of Directors. The Committee will be asked for advice and approval of actions taken. Meetings of this Committee will be documented in the Akorn, Inc.'s Board of Directors Minutes.
Any approved action plans will be documented and implemented and monitored by the management designee delegated by the CEO. Action plans will be filed in the Corporate Compliance files.
When possible, the subject matter of a report will be incorporated into the next round of applicable training sessions.
8. Disciplinary Guidelines
It is the policy of the Company that the standards of conduct and procedures for compliance with the laws and regulation applicable to the Company's business set forth in the Compliance Program shall be consistently enforced through appropriate disciplinary mechanisms. Disciplinary actions may be up to and including dismissal, and may extend, as appropriate, to individuals responsible for the failure to prevent, detect, or report an offense.
The Compliance Officer, in consultation with the CEO and Human Resources, will assist in a company-wide disciplinary system, including written disciplinary procedures, designed to produce appropriate and consistent results in disciplinary cases. The system will provide for the making of disciplinary decisions by appropriate company officials in consultation with the Compliance Officer.
The Compliance Officer will require that records be maintained in the personnel files of all disciplinary actions taken for violation of the standards of conduct or procedures for compliance with laws and regulations applicable to the Company's business set forth in the Policy and Procedure Manual.
The Compliance Officer will report periodically to Management on the disciplinary system.
As part of Akorn's continuing commitment to corporate compliance, we have developed a Comprehensive Compliance Program as mandated by California law that is designed to comply with applicable federal and state laws and industry standards relating to the marketing and promotion of our products. To our knowledge as of the date of this declaration, Akorn is in compliance with our Comprehensive Compliance Program, as described here, and with California Health & Safety Code sections 119400 and 119402.
To obtain a written copy of this Comprehensive Compliance Program summary and declaration, call (800) 932-5676 Extension 6103.
Dated: February 22, 2016