Legal Operations and Compliance: The Intersection of Law and Business at a Multinational

Kyle McEntee:

We're joined today by Jessica Colon, Associate General Counsel and Chief Compliance and Privacy Officer at West Pharmaceutical Services. And she's also responsible for legal operations. Pharma is one of the most highly regulated industries around. And while your company doesn't make drugs, West does manufacture devices and components that help other pharmaceutical companies deliver their drugs. How do you fit into this?

Jessica Colon:

Well, West has been around a hundred years and it's a really dynamic organization. My role is sort of twofold. I really support the organization in making sure that it's got great legal support from a variety of law firms around the globe to make sure that we can continue to operate. We operate in about 40 different countries and so it's important to have good legal support there. And also as the Chief Compliance and Data Privacy Officer, making sure we are doing the right things in the right way and delivering the reports on that to the various entities across the globe.

Kyle McEntee:

So let's talk a little bit about this legal structure because, as you pointed out, you're doing business in 40 different countries. You don't have enough lawyers on staff. You have to outsource a lot of the legal work. But what does the legal staff look like?

Jessica Colon:

We've got about 15, 16 lawyers on staff at the company who are responsible for the different topic areas or functional areas for the company, right? We're sort of broken up into sub-teams of experts. But obviously, that's not necessarily enough to handle 40 countries with really dynamic business and a lot of growth. And so we often reach out to local law firms to work with us on what I might call niche issues or niche topics that are very localized. So, for example, construction in country A, physical construction of buildings is going to be different than in country B, right? And so you really want to be able to tap into local experts to make sure that we're handling that well. Other examples are things like changes in regulations or tax laws or codes. You wanna make sure you're getting the best advice and guidance for the organization so that we are staying on track with the expectations of a multinational.

Kyle McEntee:

So it's not that corporations needing outside counsel is new, but legal operations as a profession within the profession is fairly new, maybe a decade old. Can you talk a little bit about the evolution of legal ops and how you've evolved with it?

Jessica Colon:

Legal ops, particularly at West, has been going from a single, big set of panel law firms, global firms, to more custom niche firms that are really fit for purpose as the organization has grown and changed over the last couple of years. And it seems to be working pretty well for us. Cause when I came to West, we had North of 70 firms supporting us and that leaves a very complicated puzzle for you to manage. And you don't always get the same consistency of support and transparency. And so we’ve taken a very different approach at West and streamlined it. Makes it a bit more efficient.

It's not just how much you're getting charged, but how quickly things can be turned around. Response time. But also the quality of the content and materials that you're getting back. If you ask for an enforceability review of potential new template for contracts, you can get that turned around more efficiently with a law firm that's been doing work for you and understands where your business is going versus say being a relatively small client at a very large firm and not necessarily getting that attention.

Kyle McEntee:

So one of the interesting things about legal ops is that the people who manage them are not always lawyers. But do you find that your background as a lawyer does help you do that maybe a little bit better? Or does it sometimes get in the way?

Jessica Colon:

I hadn't thought about that. That's a great question. I think it helps, but transparently, since I'm also a business person who eventually became a lawyer, it probably helps that I come more from a business background. When I go into those conversations with the firms about, well, what does next year's rates look like and work assignment and priorities need to be? I tend to come at it from more of a business perspective.

Kyle McEntee:

Yeah, and I guess it also probably makes it a little easier for you to have those conversations with firms. You can kind of call them on things because you know what it takes.

Jessica Colon:

Absolutely. And what we do have though is really good relationships with the primary partners at each of the firms. I have with our high volume firms, I have monthly sit downs with them. Make sure things are working well, that the folks on our side are communicating well with them, that they're getting the information and direction and response time from our folks. And then vice versa. I will also give them feedback of what our in-house counsel are saying about their firms. Whether they're happy, they're unhappy, they're impressed. If there is any billing questions or billing issues, we work really diligently to resolve those before they escalate. So, the first week of every month, I hang out with the key contacts at the firms.

Kyle McEntee:

So one of the challenges for a company of West size is that you have so much legal work and that's why you have to hire outside counsel. But that also means that reviewing their work to figure out are they being efficient is difficult.

Jessica Colon:

Mmhmm. We use a little bit of software, but we also have a regularly scheduled set of legal leadership team meetings in-house where we actually talk through how the relationships are going, where we may be spending more effort or time, and if there are concerns. And then I bring that forward into my monthly meetings with the relationship managers at the key firms.

For the most part, that seems to work. So I kind of get a heads up, then we have a conversation, we work it out, so then it doesn't roll into two or three billing cycles of disagreement or disputes or challenges. You know, we kind of grab it in the first two, three weeks when something happens.

Kyle McEntee:

So you're the one that is in charge of like when they overbill or they didn't scope things right.

Jessica Colon:

And I have the distinct pleasure of rejecting the bills. And for the most part, even when it's a difficult, you know, technically it's a difficult conversation when you have to turn around to someone and say, you know, let's talk about the bills because these entries for the month of November were problematic and you get into the details. I find that the firms are actually very responsive when we're specific. I think that there's difficulty between in-house teams and external teams when the feedback is generic. Like, “oh, that's just too high.” You need to give them something that they can action. And the other thing is we also have to be reasonable. It's not about turning around saying, I want bills that say zero dollars.

Kyle McEntee:

You still respect the work that they're doing.

Jessica Colon:

Exactly. Nobody works for free. And so you got to make sure that it's a good open relationship and a shared responsibility to make it a good relationship.

Kyle McEntee:

So how do you know when it's too high? Like what are the factors you're looking for and how did you learn to look for those factors?

Jessica Colon:

When you see multiple folks on the same day billing for really, if not identical stuff, really similar stuff, right? So if I see that there is a junior associate and a paralegal and a partner all doing research, time out. We need to have a conversation. That is not the way we do our business. The other thing is when looking at the dates of certain meetings. Who was really there? Who was really working on the, the construction contract or the leasing contract or, you know, fill in the blank, whatever the matter was. Really pressure testing that. All of our folks internally do take a very careful eye. When we see things that are unusual, they'll pull me in and then I'll have the conversation with the law firm. And we don't have any issue about asking for corrections.

The other thing is the software that we use for managing the billing allows us to make minor edits. So let's say, Kyle, you bill me for two hours and I say, we really were only on for an hour and a half. I can knock that back. The rest of your bill will get approved and get processed. And then I'll still call you and say, “Hey, Kyle, I knocked it back by a half hour.”

Kyle McEntee:

Do you get in kind of he said, she said situations with that or do they typically not bother?

Jessica Colon:

Nope, nope, not, haven't had any issues. But again, it goes back to we have the discussion at the beginning of the month. And so they know what's coming. I believe very strongly in not surprising my partners, even if it's something I find out about the day before we're supposed to have our monthly meeting. I'll text them and say, “Hey, heads up, these are the three things I want to talk about.” So they come to the conversation with some background and some context. They may even have the materials or the invoices in front of them.

Kyle McEntee:

Can you talk a little bit about how you got good at managing these sorts of things? Because this is not traditional legal work by any stretch.

Jessica Colon:

No, it's not traditional legal work. So I think as I mentioned at the beginning, I'm a business person who became a lawyer. And many years ago when I was working for a pharma company, one of the roles I took on was as a director of operations on the commercial side of the house. And then eventually in sales. And so the years I spent doing operations at a pharma company, kind of prepare you for this. It helps you kind of look at a situation and say, okay, where are the pain points and how do we streamline that? But also ensure that there's good, consistent open communication with the parties that are involved. Because if you communicate really often, chances are there's less misunderstandings. And the smoother your project goes.

Kyle McEntee:

Yeah, that makes total sense. And I think also highlights why it doesn't require someone to be a lawyer to do the legal ops job.

Jessica Colon:

Oh, absolutely.

Kyle McEntee:

Let's talk a little bit about the compliance work you do. Can you give a big picture of what sorts of compliance you're involved in?

Jessica Colon:

At West we make components for containment of pharmaceutical products and we make devices. The rules of the road for both sides actually apply to us. And so from a compliance perspective, I’ve got a program that is set up that aligns with the regulations of both a pharma company and a device company. The vast majority of our customers are other pharmaceutical and device companies. So, as long as our program aligns, it may not match everything that they do, but aligns with the base principles. In terms of anti-bribery, anti-corruption, we've got written policies, we have a hotline for people to call in with concerns or questions. We do have a mechanism for doing investigations and auditing and monitoring and risk assessment, right? All of the requirements we have in place and we are very, very active. But it is not solely for drug manufacturing or solely for devices. We've got to be able to balance the two. The other thing is that because we're a multinational, we have to take on board the requirements of the local laws. For example, from a privacy perspective, it's not just CCPA in California, considering we're in the States. But it's also GDPR or PIPL in China or Singapore.

Kyle McEntee:

So given all of this, what does your day look like? That sounds like a lot of complexity.

Jessica Colon:

There is a lot of complexity. It requires a bit of agility. Because although your schedule may be set with certain meetings and you walk in ready to tackle those topics, whether it is about preparing some of the ongoing annual reports that we need to do. Right now we're in the process of preparing our annual Conflicts Minerals Report that we have to file. That may be what's on the agenda. And yeah, there'll be a half hour where we talk about that. But then there are three back-to-back calls that come in unscheduled that are complaints or concerns that need to be dealt with from a hotline. Where somebody's calling and saying, “hey Jess, can I talk to you for a second? This happened.” And the this happened turns into an internal investigation, which is totally fine. And I love the fact that people feel comfortable to call. They don't always have to call the 800 number. They can call us direct, which is awesome. But that happens a lot. And so that's part of a typical day. You kind of have to take each phone call and say, “okay, what's new?” And take it as it comes. But then there's also really pragmatic things like reviewing contracts to make sure that the compliance terms in the contracts around things like debarment and exclusion and anti-bribery and auditing are things that align with the policies of the company. So that's very mundane, but really important and I'm sure compliance officers around the entire industry do this every day.

Kyle McEntee:

You pointed out your role in contracts. You're not drafting the contract. Someone's drafting it, running a provision by you and saying, “do I need to make any changes? Does this actually meet with your understanding of what the law requires of us?”

Jessica Colon:

That is correct. And I can give you some examples. Last week alone, I probably worked on four or five contracts that had multiple provisions that have a compliance implication. The process by which we follow at West, but also, when I was at the pharma companies was, also followed is what you want as a subject matter expert giving you feedback on is this feasible. Because once it's in the contract and the contract is signed, everybody's gotta live up to it. So you wanna make sure that whatever that says, you guys can really abide by.

Kyle McEntee:

And so it's not only the subject matter expertise that you provide, but then it's also connecting with the subject matter experts, say, scientists who can say, that's not how science works.

Jessica Colon:

Absolutely. Especially when we're talking about contracts for studies, whether it's a clinical study or an early development study, which is more about how you build the thing versus whether or not patients like the thing. You absolutely need to get their feedback. But you also need feedback from experts on things like intellectual property. You wanna make sure that your rights and the other party's rights are protected. I'd love to say I can help with that, but I can't. I don't do IP, but I wanna make sure that the IP team has a chance to look at stuff as well.

Kyle McEntee:

I think that humility is probably one of the most important features of a good lawyer, is knowing what you know, what you need to learn, and what you need to just have someone else do for you.

Jessica Colon:

Absolutely. I'm real clear what's in my wheelhouse and I'm happy to make a phone call to bring the other people that know much more than I could ever hope to join in and make sure that it's as good as it can be for the organization. And that's the nice thing about working in this organization in particular, but I find that to be the case in all of the companies I've worked at. Lawyers tend to want to solve problems. So, and they're very open when you pick up the phone and say, can you look at this and can you help? I've yet to meet one that says, no, I'm not gonna help.

Kyle McEntee:

So you mentioned earlier something called a Conflict Minerals Report. Can you tell me what that is?

Jessica Colon:

So Conflict Minerals Report is an annual disclosure that companies that, for the most part, make devices that have electronic components need to be able to disclose, especially if they're publicly traded companies like we are. It's an SEC requirement and there's a template. For us because we make medical devices, some of which have some metal components in them. Batteries, circuit boards, that sort of thing. Each of the elements of those core pieces that go into the devices have to be made in a particular way and if they come from a region that's known to have conflict minerals. And there are five countries that are particularly designated for that. You then have to be able to disclose that your supply chain is free of conflict minerals. It's a little complicated. It takes quite a bit of time, but what we do is we basically go through a very rigorous effort with our vendors and then their vendors behind them to say, “okay, where does that metal for the battery that you sold to us come from. Where do the wires for that circuit board come from? And who gave you the raw materials to make the wires that then end up in the circuit boards?” We try to chase it as far back to the actual mining of the original raw material. And that gets reported in May of every year to the SEC. And so that's our conflict minerals report. And we are in the middle of reporting season.

Kyle McEntee:

What does that look like? You know it's coming every May. When do you start to think about it? Because I'm guessing you're managing the process from beginning to end.

Jessica Colon:

We do manage the process from beginning to end. We have a steering committee that meets regularly. When we file our report in May, we kind of give everybody about a month off. And then, you know, we come back together just after the 4th of July and say, “all right, let's talk about how we're gonna start prepping for next year's report.” And we start over.

We make sure that we take any lessons learned, any new information or new suppliers that may have been identified in the current year. Because you're always reporting the prior year's data. But in the current year, if we have new suppliers or new vendors, we then start that relationship and that disclosure part with them. So that by the time we get to the end of the calendar year, we're in a really good place and it's a matter of QC-ing your data, not chasing your data, which is why we don't really take much of a break.

Kyle McEntee:

It seems like you really need to love rules and love puzzles to dive into the kind of work you do.

Jessica Colon:

I think you have to love problem solving. I'm very keen on trying to solve problems. I'm probably not the typical compliance officer that you'll meet at conferences and stuff. But I like sort of tinkering with things and figuring out, okay, well, how do we make it work? Because inevitably when people show up on my screen or at my door, it's because there's a problem. People don't come hang out with a compliance officer when everything's great.

Kyle McEntee:

Well, when you describe it that way, the clear connection to operations, in particular legal operations, is just immediately apparent to me.

Jessica Colon:

Mmhmm. I do think that there is a natural fit between compliance and privacy and operations. Operations is very much around, well, how do we make it smooth? Compliance and data privacy is about how do we keep everybody in their swim lane? And that's why they all kind of fit together. But it does require a certain attention to detail, which transparently, I don't always have, but I've got a great team that really are. They live by spreadsheets. I hang out at 30,000 feet, they hang out at like three feet above sea level. So we meet in the middle.

Kyle McEntee:

Tell me a little bit about this team that you work with. They got to be really detail-oriented, which…kind of a lifesaver.

Jessica Colon:

Oh, absolutely. No, they're amazing. And I am extraordinarily fortunate to have the team that I work with at West. The compliance team members are super detailed, very curious, and willing to ask questions, which from a compliance perspective is absolutely critical. Cause you want to understand what the situation or the circumstances are to then identify a solution. You don't wanna walk in with a preconceived notion about, “oh no, well, we're gonna go this way.” And then you end up at a dead end. No, no, you actually wanna go in with a very open mind and say, “okay, what happened? How did it happen?” Now let's figure out what the right path is so that the business can continue to operate. And whether that's disclosure that needs to be done, a change in a policy, training, you name it, it can all happen.

But the team that I've got, oh my gosh, I am so fortunate. They are folks that come from a really different perspective. I've got a privacy manager who's a paralegal. So super detail oriented, wicked smart, and unafraid to ask the questions. I've got somebody on the team who comes from a finance and audit background from the pharma side. So she's got many years of pharma experience, but in the finance and audit departments, which is really different than necessarily being a lawyer. I do have one lawyer on the team who has made an amazing transition from being a practicing lawyer to being a compliance officer. And she leads the work on our policy updates and our investigations and a couple of other areas for the program. And what's awesome is that she's been with the organization for quite some time, so she is a known entity, right? So folks are really comfortable picking up the phone and having the conversation. It's great to have a team that is diverse from a background perspective from a professional background perspective as well. Not to mention they're also spread across the globe. And it makes the program that much richer.

Kyle McEntee:

So Jess, you were one of those people that now works for you before you went to law school. And then you went to law school because you actually wanted to be in the job you're in now. Is this what you thought you were getting into?

Jessica Colon:

No, but it has been awesome and amazing and a crazy ride. The whole reason I went to law school was I wanted to make sure I could be a CCO at a pharma company. Because when I looked at my career trajectory, I'd been at Novartis a really, really long time. I'd gotten into the compliance department. I was happy in the compliance department, but when I looked across the industry and I said, “where do I wanna grow to?” It is the C-suite, but it's not the CEO's seat. I'm real clear on that. And as I looked across the pharma industry, cause at that time I was in pharma, all of the CCOs were lawyers, every single one. And I was like, all right, well, better to be prepared for the opportunity when it comes. And so before I'm officially ready to go get that job, let me get the degree, let me get the requirements under my belt so that as I'm gaining the actual work experience in being a junior compliance officer, at the time, I could be ready. And it was the craziest decision of my life and probably one of the best.

Going to law school, it's also equipped me to be better at this job, I've got a really good understanding of why things are written the way they are, what the expectations of the regulators are, and then how do we meet them where they are in an effort to ensure the company continues to operate effectively and efficiently. At the end of the day, this role is about keeping things moving and everybody in their swim lane.