As Red Cross fined $9.6M, questions arise on use of penalties

January 18, 2012|By Marie McCullough, Inquirer Staff Writer

As the Red Cross faces yet another fine in a decadelong series of multimillion-dollar fines for unsafe blood-management practices, questions are being raised about the effectiveness of the penalties.

The Food and Drug Administration's latest fine of $9.6 million covers many facilities, but focuses on hundreds of violations found during a late-2010 inspection of two new blood-donor support centers in Philadelphia and Charlotte, N.C.

The FDA announced the fine Friday, exactly a week after the consumer advocacy group Public Citizen contended that the agency was stalling. The group said federal officials had agreed on a fine "months ago."

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Including the latest sanction, the FDA has levied $47 million against the Red Cross blood business since 2003. It cited chronic problems with understaffing, inadequate training, quality assurance, and product surveillance that put blood donors and recipients at risk.

"Many of the violations recounted in this letter are virtually identical to violations charged" in previous penalty-notification letters, FDA official Evelyn Bonnin wrote Friday to the Red Cross. The organization "has failed to take adequate steps to correct them."

In a written statement on its website, the Red Cross maintained that it had corrected the problems and expressed "disappointment" that the FDA "believed it necessary to issue a fine" for an inspection done 15 months ago.

Yet, the Red Cross would not release more-recent inspections because they are considered "open."

"You'd have to go through the FDA to get them," said Red Cross spokeswoman Stephanie Millian.

An FDA spokeswoman said Tuesday evening that the agency did not have time to answer questions submitted by e-mail early in the day.

Sidney Wolfe, director of Public Citizen's Health Research Group, said the FDA's unsuccessful pursuit of compliance has become "a vicious continuum."

"The longer the FDA waits to impose fines, the more opportunity the Red Cross has to say: 'That was then. This is now. Everything is fine,' " Wolfe said from his Washington office.

Even if the FDA were to act in a more timely fashion, fines simply would not be enough incentive for improvement, Wolfe and other observers believe.

"The Red Cross considers the fines part of the cost of doing business," said Daniel Borochoff, president of CharityWatch, a watchdog group that evaluates the efficiency of charities. "They may feel it's cheaper to pay the fines than to handle the blood supply in a more correct way."

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