New standard questions in PAR letters
I recently started seeing a series of questions on post-approval review letters that seem to be more adversarial than previous PAR letters were. I do not think it is necessarily intentionally so, but I know the companies I speak with have felt quite concerned by the tone. The series is as follows:
1. Has the policy form been issued? If so, please identify the number of policy forms issued.
2. Is the policy form still being issued? If not, when did sales cease?
3. Has the policy form been replaced by a subsequently approved form? If so, please identify by form number, Department file number, and date of approval.
These introductory questions are then typically followed by any substantive questions or requests for clarification. But then the most alarming questions get asked - still in this first letter before there is any discussion of the issues, which are often quite minor. These new questions read:
--In view of the comments made herein, is it your company's intention to continue to issue the policy form? If so, please note that penalties imposed for statutory and regulatory violations can take into consideration the number of forms issued.
-- If you wish to replace this form with a corrected form for use on a going forward basis it will be necessary to make a new submission..
This new approach might make sense if most of the questions that were raised on post-approval reviews were significant statutory and regulatory issues. But most of the comments in these letters are requests for clarification, changes to language based on department interpretations of the entire contract requirements and changes based on assertions that there is a potential for something to be unjust, unfair and inequitable.
The suggestion of penalties at the outset of the review can't help but make company's responses more guarded. It seems to add to the confusion over what these reviews are: are they efforts to make the policies as much to the department's liking as possible? If so then the language tweaks and the emphasis on entire contract might make sense. But those questions - the ones I typically see - just do not seem to rise to the level where a company would consider pulling the product from the market or conceding in a first letter that revisions in the form of a new submission are necessary for compliance. If these reviews are intended to find the significant violations of law or regulation then the emphasis on penalties may make sense, but very few of those seem to be found, based on the letters I have seen.
Given this disconnect, the new standard questions make an appropriate response much more difficult for a company to craft.
