California Compliance

A. Introduction

Foundation Medicine, Inc. (“FMI”) seeks to help patients and providers navigate the complex landscape of cancer care and provide genomic insights to help guide informed decisions. Our mission at FMI is to bring deep molecular information to the point of care for every patient living with advanced cancer.

FMI’s Code of Conduct (“Code of Conduct”) reflects our commitment to conducting business with high standards of ethical behavior. The Code of Conduct is applicable to all employees of FMI. All directors, officers and employees are expected to act with integrity and to make ethical decisions consistent with the Code of Conduct.   

FMI is committed to establishing and maintaining an effective compliance and ethics program that promotes conducting business with integrity and complying with the laws applicable to FMI and its operations. Our compliance and ethics program is based on the elements described in the "Compliance Program Guidance for Pharmaceutical Manufacturers" issued by the Office of Inspector General of the U.S. Department of Health and Human Services (the "OIG Guidance") and the "Code of Ethics on Interactions with Healthcare Professionals" issued by the Advanced Medical Technology Association (“AdvaMed Code”)

FMI’s compliance and ethics program is designed, implemented and operated with the goal of preventing, detecting and responding to potential or actual instances of non-compliance. All FMI employees are required to comply with the Code of Conduct, company policies, and applicable laws. However, as acknowledged by the OIG Guidance, the implementation of a comprehensive compliance program does not guarantee that there will be no misconduct. If FMI becomes aware of potential violations of law, the Code of Conduct or company policy, the matters are investigated. As appropriate, disciplinary and corrective actions are implemented to prevent future violations.  Additionally, FMI continuously assesses the effectiveness of its compliance program to enable it to implement necessary adjustments or refinements to the program. 

Following is an overview of FMI’s comprehensive compliance and ethics program which is reviewed and updated periodically to meet changing regulatory, legal and compliance requirements.

Leadership and Oversight

FMI has a Chief Compliance Officer who is responsible for developing, operating, and monitoring the compliance and ethics program. The Compliance Officer reports directly to the General Counsel. FMI’s Compliance Officer has the ability to effectuate change within the organization and to exercise independent judgment.

FMI has established a Compliance Committee designed to provide leadership and support for the company’s compliance and ethics program, assist FMI’s leadership team in managing the compliance and ethics program, and to provide assistance and guidance in assessing and verifying the effectiveness of the compliance and ethics program to promote our ethical business culture and compliant operating environment. The members of the Compliance Committee are senior leaders from multiple business functions. The Compliance Committee meets on a regular basis to monitor FMI’s comprehensive compliance and ethics program.

Written Standards

In addition to the Code of Conduct, FMI has developed and implemented compliance policies and procedures to help ensure compliance with applicable laws and to support ethical decision-making. These policies and procedures have been developed under the direction and supervision of the Chief Compliance Officer and Compliance Committee.  FMI’s written standards address the key areas of potential risk for medical device manufacturers identified in the OIG Guidance. All FMI employees and representatives are required to adhere to the company’s policies and procedures.

FMI’s relationships with healthcare professionals are intended to benefit patients and to enhance the practice of medicine.  Informational presentations and discussions by company representatives and others speaking on behalf of FMI provide valuable scientific and educational benefits. In connection with such presentations or discussions, FMI may offer occasional meals and items designed primarily for the education of patients and healthcare professionals in accordance with the AdvaMed Code.

With respect to business activities in California, FMI has established "a specific annual dollar limit on educational items and promotional activities FMI may give or otherwise provide to an individual medical or healthcare professional."  FMI has established an annual maximum dollar limit of $2,000, effective as of January 1, 2021.  FMI will evaluate this limit on an annual basis and make any necessary adjustments consistent with any operational or practical issues related to compliance with the statute. The annual limit does not include expenditures for the following:

• Financial support for continuing medical education programs
• Financial support for health educational scholarships
• Payments for legitimate professional services, and any meals or expenses associated with the provision of such services
• Patient educational materials provided to patients by their physician with the purpose of educating the patient or enhancing the patient’s understanding or management of the condition 

Education and Training

All FMI commercial employees in the U.S. receive appropriate compliance training which includes education on the OIG Guidance, the AdvaMed Code, anti-kickback laws and anticorruption, the federal False Claims Act, and requirements related to product promotion, privacy, conflicts of interest, and other applicable federal, state, and industry rules and guidelines. FMI regularly reviews and revises its compliance training and seeks to identify new areas of training that may be needed to educate employees on compliance matters and the laws and requirements applicable to FMI.

Internal Lines of Communication

FMI encourages open communication and maintains an open reporting environment.  The company has adopted and reinforces its policy against retaliation. FMI’s Code of Conduct and policies require employees to report any actual or suspected violations of the Code of Conduct, company policies or applicable law.  Each reported matter is appropriately investigated and addressed. Employees can raise concerns or report potential misconduct in a number of ways including managers and business leaders; the Compliance, Legal or Human Resources teams; or the third-party operated hotline.  Employees may raise concerns without fear of retaliation. In addition, FMI’s Compliance team maintains an internal website on which compliance-related policies, guidance and information can be found.

Auditing and Monitoring

FMI’s comprehensive compliance and ethics program includes an auditing and monitoring plan to assess whether policies and procedures which address compliance risk areas have been implemented and communicated and are followed. The areas for monitoring and auditing are reviewed and updated to reflect evolving compliance concerns, new regulatory requirements, changes in business practices, and other considerations. The results of auditing and monitoring activities are considered in adapting and improving existing compliance policies, procedures and training.

Responding to Potential Violations

Employees are required to adhere to the Code of Conduct and company policies.  Any violations can subject an employee to serious disciplinary measures, including possible termination of employment. Although the disciplinary and corrective actions for each situation are determined on a case-by-case basis, FMI seeks to ensure consistent and appropriate disciplinary and corrective actions are taken in response to violations.

Corrective Action

FMI conducts investigations of potential violations of the Code of Conduct and company policies in accordance with its written investigations and corrective action protocol to ensure timely, complete, and objective investigations.  In accordance with the OIG Guidance, the exact nature and level or thoroughness of the internal investigation will vary according to the circumstances. Once an internal investigation is completed, corrective action and preventative measures are determined and implemented as appropriate.

This description is effective as of January 1, 2022. FMI will assess its compliance program at least annually, for the purpose of declaring compliance with California Health and Safety Codes §§ 119400-119402.

California Declaration of Compliance

Foundation Medicine, Inc. (“FMI”) is committed to establishing and maintaining an effective compliance and ethics program that promotes conducting business with integrity and complying with the laws applicable to FMI and its operations.  Based on a good faith understanding of the requirements of Section 119402 of the California Health & Safety Code, FMI hereby declares that, to the best of its knowledge, as of January 1, 2022, FMI is in material compliance with its comprehensive compliance and ethics program and the requirements of the California Health & Safety Code §§ 119400-119402. It is FMI’s expectation that all employees and representatives comply with its compliance and ethics program and all policies that support this program. FMI is committed to assessing ongoing compliance with its compliance program, which is designed to prevent, detect and respond to potential or actual instances of non-compliance.

A copy of this Declaration may be obtained by contacting FMI at (888) 988-3639.