Why Federal Agencies Are Targeting Executives

Federal enforcement is changing. Regulators aren’t just going after companies anymore. They’re naming CEOs, CMOs, heads of clinical, quality, and operations in consent decrees and injunctions. Once your name is on that document, it follows you for years and shapes your career.

In this episode we unpack:

• Why enforcement has shifted toward individual accountability
• How repeated compliance failures trigger personal liability
• Data integrity and why it matters more than ever
• Why clinical research and telehealth are now in regulators’ crosshairs
• What personal obligations look like inside a consent decree
• What executives should be doing now to protect themselves

If you lead in an FDA-regulated space, this one matters.

Get show notes and resources at www.kulkarnilawfirm.com

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Transcript

Darshan: 0:00

We're talking about a topic that absolutely every CEO, CMO, head of clinical, and quality needs to hear. What if a consent decree follows you and not just your company? Federal agencies have repeatedly shown that when they lose confidence in leadership, they look to escalate beyond the organization. They want to attach obligations to the actual people by name. Let's talk about why this happens, what it means, and how you protect yourself. Federal pattern, why are individuals being named? Recent injunction and consent decree cases, courts didn't just include the corporation. They named the president, the executive in charge of your operations, or the individual responsible for compliance oversight. This shift didn't come out of nowhere. Federal agencies have spent the last decade sending the same message. You can delegate tasks, you cannot delegate responsibility. When those people get named, the decree becomes part of the professional life no matter where they go next. So let's talk about when data integrity collapses and personal liability rises. Another major case that we just saw involved widespread data integrity issues spread across both the US and Indian operations. Once again, enforcement didn't just fall on the corporation. It included personal obligations like oversight by independent experts, mandated internal reorganization, accountability for truthful submissions, ongoing reporting, and heavy financial penalties. This one was interesting because it actually established a new office, an office of data reliability, something that we may want to consider as we consider going forward. This will be led by a new executive, it will be supported by a hotline, and by third-party audits. When the government loses trust in the data, they stop distinguishing between corporate failures and leadership failures, and that's when your name can appear in decrees. So why clinical research and telehealth? Why are these at risk now? A lot of leaders believe that consent decrees only happen in manufacturing. They don't. Not anymore. Federal enforcement is looking at systemic protocol violations, investigators not being supervised, missing safety reporting, inadequate vendor oversight, and this one's come up a couple different times. Telemedicine prescribing issues, poor audit trails and decentralized trials, compounding activities outside legal limits. And again, we've seen multiple cases involving state attorney generals in that case as well. Any of these persist across inspections and audits, leadership becomes fair game. Think about telehealth companies writing prescriptions at a scale without proper documentation. Think about decentralized trial companies with no verifiable chain of custody. Think about CROs running processes that the sponsor never verifies. And this is what turns corporate violations into leadership accountability. So what does personal liability look like? When your name is in the consent decree, you're not dealing with theoretical risk anymore. It's a real life, day-to-day responsibility.

SPEAKER_00: 3:35

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Darshan: 3:43

It can impact your restrictions on your ability to run or supervised operations because you may not be allowed to oversee manufacturing clinical processes until remediation is approved. You may be looking at mandatory certifications signed under penalty of law, and you personally verify corrective steps. You may need to have direct communication with the FDA and you become a point of contact for all oversight. There may be personal financial exposure, and that may apply to the executive and not just the company. You may be looking at multi-year federal supervision, and these decrees can last five years or more and explicitly attach to individuals. And this can actually impact future job responsibilities in an FDA regulated space. And that's why proactive compliance isn't just nice to have, it's now becoming self-preservation. Now nobody ever says, I hope today's the day I become personally named in a federal injunction. And if they did, you know what? I'd recommend therapy. Maybe yoga, maybe KO. I don't know. But humor aside, that's exactly why compliance is something that leadership has to actively champion. And it's not something that's delegated, then forgotten. If the company fails repeatedly, federal agencies are going to start looking at the person with the authority to stop it. So here's what you want to look at. This is straight from the KLF playbook. So treat every warning letter like it's a final warning. It's not a suggestion, it's not a friendly note, it's a warning. You want to fix systemic problems. These are not symptoms. You want to go after the root cause of the problems themselves. So if something shows up in consecutive inspections, leadership gets the focus. Strengthen data integrity. We just saw that they're actually naming new offices based on this. Whether it's manufacturing, research, telehealth, compounding, you want an office of data research, data integrity. Build true oversight into your decentralized and telehealth models. Audit trails matter. If your data is not traceable, regulators will assume the worst. I did a podcast recently and even had a newsletter about how data chains need to start mattering and we need to start tracking data. Document leadership involvement and compliance. You want a record that shows I looked, I acted, I funded, I verified. Validate vendors like they're part of your company because they mess up repeatedly, you're still responsible. This is where my team comes in. We work with CEOs, CMOs, heads of clinical and operations to help create compliance structures that will stand up to real inspection pressure. It means executive-level compliance reviews, mock FDA audits, and again, this might also include DOJ and HHS audits, vendor qualification frameworks, clinical oversight, promotional compliance guardrails, telehealth prescribing and documentation, investigating and eliminating root causes before regulators find them. If you want to make sure that your name doesn't appear in a consent decree, bring us in early. Visit www.clcarneylawfirm.com, schedule a consult. As you can tell, compliance isn't just about legal, it's operational. It's data-driven, it's documentation driven. And that's where Ceres comes in. Ceres gives your team a controlled way to share documents, to track interactions, to maintain audit trails, to identify risk hotspots, and ensure that what you think is happening is actually happening. Whether you're running clinical ops, telehealth programs, metaphors workflows, or vendor management, Ceres lets you see the full picture. If you don't have a structured, traceable compliant system, that's the risk federal agencies look for. Saris helps eliminate that uncertainty. Follow our page on LinkedIn. Consent decrees are evolving, they're becoming personal, and federal agencies have shown that they're willing to name individuals in leadership roles. If this scares you a little, good. It should. That's exactly why these agencies are going after individuals. Because the solution is within your control. You want to support your compliance teams. And the compliance teams, if you don't have that support, you have a problem. You want to fix your problems early. You want to use tools like SARS to keep everything auditable. You want to work with KLF to ensure that operations will withstand scrutiny and then stay ahead of the enforcement curve. Call, click, or email.