US drug companies are hiring their own auditors to review compliance following civil violations, raising conflict of interest fears

Billy Bambrough
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EY and PwC are two auditors that have been hired by existing pharma clients to carry out compliance reviews (Source: Getty)

Some of the US' biggest drug companies have been found to be hiring their existing auditors to carry out compliance reviews, creating a potential conflict of interest.

The compliance reviews are a part of government settlements over alleged civil violations, such as off-label drug promotion or paying kickbacks.

Federal records revealing the practise were uncovered by a Reuters freedom of information request.

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Big pharma has become wrapped up in controversy in recent months, in scandals from price hiking, to corruption.

The US department of health and human services inspector general does not prevent companies from hiring auditors they have existing contracts with – unlike the Justice Department or the Securities and Exchange Commission.

EY and PwC have both been hired by drug makers – including Novartis, GlaxoSmithKline, Merck, Sanofi and Allergan – to carry out reviews, despite the auditors doing current or previous work for the firms.

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The pharma firms said they had disclosed their business relationships to the regulator.

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