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Because individual prosecutions involving the federal Food, Drug, and Cosmetic Act (“FDCA”) are relatively rare, it is easy to forget that the FDCA is a criminal statute.   It also is a strict liability statute, meaning that simply failing to comply with the statute’s requirements is a misdemeanor that can result in substantial fines and up to one year’s imprisonment.[1]  However, FDCA violations can become felonies, with up to three years in prison, if the government proves a person acted with intent to defraud or mislead.[2]

Two recent developments are crucial reminders to life science employees and executives of the personal consequences of such violations.  In December 2023, the U.S.  Court of Appeals for the First Circuit upheld the misdemeanor convictions and sentencing, including substantial fines (i.e., >$500 K), for the former Chief Executive Officer and Vice President of Sales of Acclarent, a medical device manufacturer.[3]  The executives were convicted of promoting a medical device for an unapproved use (i.e., “off-label”) and actively training the company’s sales representatives on how to do so.

More recently, Peter Stoll, III was sentenced to 12 months in prison and one year of supervised release for creating two fictitious FDA medical device marketing clearance letters.[4]    Stoll, a company regulatory affairs specialist,  previously pled guilty to a single felony FDCA violation.[5]  As a result of his actions, the government contended that Stoll’s employer sold medical devices throughout the U.S. based on those false letters.

These cases are a stark reminder that company executives and employees violating the FDA’s requirements do so at their peril.  The Justice Department continues to stress its efforts to hold individuals accountable for corporate misdeeds, meaning we will likely see more of these types of prosecutions.  Moreover, they serve to dispel the “urban myth” still prevalent in the life science industry that the DOJ only pursues cases involving large companies.  That is untrue, and size does not matter when individual criminal liability is involved.

[1] See 21 U.S.C. § 333(a)(1).

[2] See 21 U.S.C. § 333(a)(2).

[3] See U.S. v. William Facteau (2023), Case No. 21-1080 and 21-1082 (1st Cir. Dec. 14, 2023).

[4] See Press Release, U.S. Dep’t of Justice, Former Employee of Medical Device Manufacturer Sentenced for Forging Two FDA Letters that Led to Illegal Sale of Medical Devices (Jan. 24, 2024).

[5] See Press Release, U.S. Dep’t of Justice, Former Employee of Medical Device Manufacturer Pleads Guilty to Forging Two FDA Clearance Letters for Medical Devices (July 20, 2023).