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Life Science Codes of Conduct


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Overview of codes of conduct

Overview of codes of conduct

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  • 1.
    • Annual Sales/Clinical Meeting
    • August 11, 2009
  • 2. Recent Developments
    • Considerable activity related to “codes of conduct or codes of ethics”:
      • Legislation has been proposed at the Federal level;
      • AdvaMed has changed their recommended code of ethics;
      • Massachusetts and Vermont passed legislation and other states are considering legislation;
      • Several hospitals, including Partners HealthCare and John Hopkins, have changed their codes of conduct.
    Federal and State Legislation Hospital Codes Of Conduct Trade Associations Codes of Conduct
  • 3. Intent is to prevent undue influence in the relationship between health care practitioners and manufacturers. “There Ain’t No Such Thing As a Free Lunch.” Author Unknown
  • 4. Common Elements
      • State and Potential Federal
      • -Meals, gifts, entertainment, etc. defined.
      • -Compliance required.
      • -Required reporting of expenditures.
      • -Certifications may be required.
      • -Penalties may be imposed.
      • -Audit requirements.
      • -Public disclosure of payments.
    • Trade Groups and Hospitals
    • - Meals, gifts, entertainment, etc. defined.
    • -Compliance voluntary or required of others (doctors, etc.)
    • -Reporting not required.
    • -No certifications required.
    • -No formal penalties.
    • -No formal review mechanism.
    • -No public disclosure of payments.
  • 5. Overview of Presentation
    • Whether right or wrong, all these initiatives send the message that “there are no free lunches” and that conduct must be changed.
    • This presentation will address the:
      • Federal and other state legislation
      • Massachusetts Marketing Code of Conduct
      • AdvaMed Code of Ethics
      • Partners HealthCare Recommendations on Interactions with the Medical Products Industry
  • 6. Federal Legislation
    • Federal law “Physician Payments Sunshine Act of 2009”:
      • Introduced 1/22/09.
      • Will require spending disclosure on a national basis.
      • Individual payments in excess of $100.
    • Included in House and Senate versions of national health care reform legislation now being discussed. May be modeled after Massachusetts legislation.
  • 7. Other State Laws
    • Vermont
      • Enacted stricter laws than Massachusetts.
      • Effective July 1, 2009.
    • Other existing or proposed state laws for medical device companies (as of March 13, 2009):
      • Connecticut
      • Iowa
      • Minnesota
      • New York
      • Texas
    • Require adoption and disclosure of compliance program:
      • California
      • Nevada
  • 8.  
  • 9. Overview of Massachusetts Legislation
    • 8/10/08 Massachusetts enacted “An Act To Promote Cost Containment, Transparency and Efficiency in the Delivery of Quality Health Care”.
    • Detailed and strict compliance requirements.
    • Required Massachusetts Department of Health (DPH) to adopt a marketing code that is no less restrictive than the most recent versions of the AdvaMed code.
    • Also contains prohibitions related to companies interactions with healthcare professionals.
  • 10. Overview of DPH Regulations
    • Issued regulations on March 11, 2009.
    • July 1, 2009 initial compliance date required.
    • Annually, beginning on July 1, 2010, companies must certify to the DPH that audits to monitor compliance with the Marketing Code have been conducted.
    • Penalty is a fine of not more than $5,000 for each transaction, occurrence or event.
  • 11. Significance of Massachusetts Legislation
    • Require disclosure of industry payments to health care practitioners by medical device companies;
    • Broadest definition of “sales and marketing”;
    • Disclosure data will be part of the public record. DPH will provide a web database that will be searchable by health care provider name and by company.
  • 12. Requirements of Medical Device Companies Marketing Codes
    • Must be in compliance with DPH’s Marketing Code and
    • Must implement a corporate compliance program, with reporting and certifications to Massachusetts, and
    • Annual certifications and disclosures of financial relationships to Massachusetts.
  • 13. DPH Implementation Goals Limit Interactions That Influence Prescribing Patterns Not Restrict Beneficial Industry Interactions (Research and Training) Increase Transparency Of Industry Payments Safeguard Confidentiality of Trade Secrets and Proprietary Information
  • 14. What is a Sales and Marketing Activity?
    • Influencing the prescribing behavior of a health care provider.
    • Marketing of a medical device.
    • Influencing a purchasing decision or market share.
    • Evaluating the effectiveness of a sales force.
    • Product education.
    • Training.
    • Research projects designed or sponsored by a company marketing group.
    • Research projects that have marketing, product promotion or advertising as a purpose.
  • 15. Excluded from Sales and Marketing Activities
    • Clinical trials and genuine research payments;
    • Demonstration or evaluation units;
    • In-kind items used for the provision of charity care; and
    • Confidential price concessions established in contracts.
  • 16. Prohibitions in the Marketing Code
    • Entertainment or recreational items of any value and meals associated with such activities;
    • Meals outside of the health care providers office or hospital setting, and meals without an in-person informational presentation;
    • Sponsorship or payment for continuing medical education that does not meet certain standards, or that provides payment directly to a health care practitioner for continuing medical education;
            • continued on next page
  • 17. Prohibitions in the Marketing Code-Continued
    • Advice or guidance to a continuing medical education provider regarding the content or faculty for an educational event funded by the company;
    • Payments for:
      • Meals provided to a health care provider,
      • Compensation for time spent,
      • Non-faculty health care providers expenses,
      • Travel, lodging or other personal expenses,
      • Third-party scientific or educational conferences, or
      • Professional meetings.
            • continued on next page
  • 18. Prohibitions in the Marketing Code-Continued
    • Law is intended to apply to medical device distributors since they represent companies.
    • Any payment or activity that is prohibited under “applicable federal or state ‘fraud and abuse’ laws or regulations including the federal ‘Anti-Kickback Statute.’ ”
    • Payments of any kind to health care practitioners, except as compensation for “bona fide services”.
  • 19. Permitted Activities
    • Distribution of peer-reviewed academic, scientific or clinical information.
    • Purchasing advertising in peer reviewed journals.
    • Payment for reasonable expenses necessary for technical training on the use of a medical device if that expense is part of the vendor’s purchase contract for the device.
    • Compensation for consulting services in connection with a genuine research project or a clinical trial.
  • 20. Bona Fide Services
    • Must have a written agreement for identified services.
    • Compensation established based on fair market value.
    • Services need to be identified in advance, i.e. budgeted.
    • Connection between the competence and expertise of the health care provider and the purpose of the arrangement.
    • The number of health care providers retained is not greater than the number reasonably necessary to achieve the purpose.
    • Venue and circumstances of any meeting is conducive to the services and activities of the services.
    • Decision to retain a health care provider is not unduly influenced by sales personnel.
    • Company must retain records.
  • 21. What is a Hospital Setting- Where Meals Can Be Provided?
    • Facility specially designed to approximate the conditions of a surgical suite or a working clinical laboratory, or
    • To provide medical training on large and/or technical medical devices.
  • 22. When Can Meals Be Sponsored?
    • Third party organizers of continuing medical education or other meetings may use general funds from companies to provide meals.
    • Application of sponsorship funds towards meals must be made at the continuing medical education providers discretion.
    • Continuing medical education events can be held in Massachusetts.
  • 23. Intellectual Property Payments
    • Regulations do not apply to intellectual property agreements and related documents.
      • Generally would follow bona fide research activities.
      • Royalty payments.
      • Not considered to a be loophole and must be structured appropriately.
  • 24. Applicability in Other States
    • Applies only to those health care providers licensed in Massachusetts.
    • However, does apply to Massachusetts licensed health care providers for activities outside of Massachusetts.
    • Example, if a company sponsored a meal at a restaurant in connection with a conference in New York or conducted product training at an adjacent hotel restaurant, Massachusetts licensed health care providers could not attend.
  • 25. Coverage Requirements for Policies and Procedures
    • Consulting services “needs assessment”.
    • Selecting and retaining health care providers as consultants.
    • Meetings and ongoing requirements of consultants.
    • Support of third party conferences and meetings.
    • Providing of meals to health care providers.
    • Continued medical education, third-party scientific or education conferences and professional meetings.
  • 26. Coverage Requirements for Policies and Procedures -Continued
    • Gifts, entertainment and other items of value.
    • Scholarships, grants and other financial support.
    • Employee training.
    • Investigation of non-compliance.
    • Corrective action and voluntary reporting.
    • Compliance audits.
    • Capturing and disclosing payments to Massachusetts.
  • 27. Training Requirements
    • Required to provide regular training to company representatives who visit health care providers.
    • Description of training programs must be available if DPH requests.
    • Training must cover:
      • The company’s marketing code of conduct
      • General science
      • Product-specific information
    • Companies must regularly assess its representatives to ensure that they comply with the Marketing Code.
      • Companies might want to “test” employees.
  • 28. Role of Compliance Officer
    • Responsible for operating and monitoring the marketing code of conduct.
    • Name and contact information provided to DPH.
    • Certification that company is in compliance with marketing code.
    • Certification that the company has conducted annual audits.
  • 29. Required Disclosures and Certifications to Massachusetts DPH by 7/1/09
      • Policies and procedures for the investigation, resolution and corrective actions for instances of noncompliance.
      • Company compliance officer name, address, email address and telephone number.
      • Certification that the Company has a marketing code of conduct.
      • Annual fee of $2,000.
  • 30. Required Disclosures and Certifications to Massachusetts DPH by 7/1/10
    • Certification that the company has conducted annual audits in compliance with the Marketing Code.
    • Report the nature, value, purpose and recipient of anything that has a value greater than $50.
    • Individual payments greater than $50 - not aggregate payments.
    • Initial reporting period 7/1/09 to 12/31/09.
  • 31. Advanced Medical Technology Association (AdvaMed)
    • Overview of the Revised Code of Ethics on Interactions with Health Care Professionals
  • 32. AdvaMed Code Compliance
    • Effective July 1, 2009.
    • Voluntary but companies are strongly encouraged to adopt the Code and to implement an effective compliance program.
  • 33. Prohibition on Entertainment and Recreation
    • To avoid the appearance of any impropriety, Companies should not provide or pay for any recreation or entertainment of HCPs.
  • 34. Modest Meals
    • Purpose. Meals should be incidental to the presentation of bona fide scientific, educational and business information.
    • Setting and location. Meals may occur at the HCPs place of business, or when such venues are not available, at a location conducive to such exchanges.
    • Participants. Companies may provide meals only to those HCPs who have professional interest in, and actually attend, the meeting.
  • 35. Education Items, Prohibition on Gifts
    • Companies may provide items to HCPs that either benefit patients or serve as a genuine education function.
    • Other than medical textbooks or anatomical models used for educational purposes, the value of such gifts should have a fair market value of less than $100, and should not be capable of use for non-educational purposes.
    • Companies may not give HCPs non-educational branded promotional items, even if they are of minimal value and related to the HCPs work or benefit patients.
  • 36. Research and Educational Grants and Charitable Donations
    • Provision of research and educational grants and charitable donations by companies are worthwhile undertakings provided they are not offered as an unlawful inducement.
    • Companies should adopt objective criteria for the provision of grants and charitable donations that do not take into account purchasing criteria and implement appropriate procedures to ensure that grants and charitable donations are not used as an unlawful inducement.
    • A company’s sales personnel may provide input about the suitability of a grant or charitable donation recipient or program, but they should not control or unduly influence such decisions.
  • 37. Company-Conducted Product Training
    • Programs should be conducted in clinical or educational settings that are conducive to exchange of information, like clinical educational or conference centers.
    • “ Hands-on” training should be held at facilities suitable for the type of training to be conducted, and instructors should be qualified and have the technical expertise to conduct the training.
    • Meals and refreshments may be provided only to attendees and must be modest in nature and subordinate in time and focus to the training and/or education.
    • Companies may pay for necessary and reasonable travel, and modest lodging for healthcare professional attendees only.
  • 38. Supporting Third-Party Educational Conferences
    • Grants. Companies may provide grants only to conference sponsors to reduce conference costs or to training institutions to allow attendance of HCPs in training. Grants should be paid only to reimburse legitimate expenses for the educational activity, and the conference sponsor is solely responsible for the program content, faculty, educational methods and materials.
    • Conference meals and refreshments. Companies may provide meals and refreshments to all attendees provided that they are open to all attendees. Meals or refreshments should be modest in value, subordinate in time and focus to the purpose of the conference, and should also be clearly separate from the education portion of the conference.
    • continued on next page
  • 39. Supporting Third-Party Educational Conferences-Continued
    • Faculty expense. Companies may provide grants to conference sponsors for reasonable honoraria, travel, lodging and modest meals for HCPs who are bona fide conference faculty members.
    • Advertisement and demonstration. Companies may purchase advertising and lease booth space for company displays at conferences.
  • 40. Sales, Promotional and Other Business Meetings
    • Appropriate to discuss product features, sales terms or contracts.
    • Companies may pay for occasional modest meals in connection with such meetings.
  • 41. Consulting Arrangements With HCP’S
    • Consulting agreements should be for bona fide services and should describe all the services that are to be provided.
    • There should be a written research protocol when clinical research services are being provided.
    • There should be a legitimate need for the services identified and documented in advance.
    • Consultants should be selected based upon their qualifications relative to their defined need.
    • Continued on next page
  • 42. Consulting Arrangements With HCP’S-Continued
    • Compensation should be a fair market value without regard to the value of the consultant’s business.
    • Companies may pay for reasonable and actual expenses, such as travel, modest meals and lodging, incurred by the consultant.
    • Company’s sales personnel may provide input regarding the suitability of proposed consultants, but should not control or unduly influence the selection process.
  • 43. Provision of Coverage, Reimbursement and Health Economics Information
    • Companies may provide accurate and objective coverage, reimbursement and health economics information regarding their products to HCPs.
    • Companies may collaborate with HCPs, patients and organizations to achieve payer coverage, obtain guidelines and policies, or receive adequate reimbursement levels.
    • Companies should not suggest any mechanisms for billing for medically unnecessary services nor engage in fraudulent practices to achieve inappropriate payment.
  • 44. Partners HealthCare April 10, 2009
    • Summary of Partners Industry Interaction Requirements—A Medical Device Company Perspective
  • 45. Background on Partners HealthCare
    • Boston, MA based integrated health system.
    • Two academic medical centers and many community and specialty hospitals, community health centers, a physician network, home health and long-term care facilities.
    • Leading biomedical research organization.
    • Principal teaching affiliate of Harvard Medical School.
  • 46. Background on Recommendations
    • Recommendations made by an internal commission charged with examining the health system’s policies and practices for interacting with pharmaceutical and medical device companies.
    • Commission comprised of physician leaders from across the Partners system.
    • Endorsed by Partners HealthCare Board of Directors.
  • 47. Purposes of Commission
    • Formulating principles to guide partners approach to industry interactions;
    • Reviewing Partners current range of relationships with industry;
    • Considering the potential need for changes in policies and practices; and
    • Developing recommendations regarding modifications to policies, the need for new policies and practices, and the infrastructure required to better support and enforce all activity.
  • 48. Overview
    • Tightens many current policies.
    • Introduces several new policies.
    • Calls for a renewed and rigorous institutional commitment to education, oversight and enforcement.
    • Partners will develop a comprehensive implementation plan.
    • To be implemented in phases, with target effective date of as of 10/1/09.
    • Task force appointed to ensure prompt implementation and successful rollout.
  • 49. Enhancements to Conflict of Interest Disclosure Process Over Past Two Years
    • Now reported and analyzed online.
    • Focus on ensuring disclosures are submitted and reviewed in a timely manner.
    • Required participation has been expanded to include more than 6,000 physicians, researchers, institutional officers and other employees.
    • Sanctions for noncompliance are in place.
  • 50. Key Recommendations (page 1 of 3)
    • Prohibition of all gifts, including meals and funding for meals, provided directly to staff or Partners institutions for their personal use, on a Partners site or off-site.
    • Requiring that industry representatives have written invitations defining the purpose and terms of visits before having access to partners sites and staff.
    • Establishment of a process to identify and manage significant financial interests held by physicians in companies that make products they prescribe or use in their practices.
  • 51. Key Recommendations (page 2 of 3)
    • Acceptance of industry funding for educational programs and fellowships only if provided through a centrally pooled institutional President’s fund at each hospital or approved by a Partners-wide Educational Review Board.
    • Establishment of a robust, tiered approach to evaluate research related conflicts of interest.
    • Adoption of a stricter policy holding certain officials to a higher standard because of their influential positions with the organization.
  • 52. Key Recommendations (page 3 of 3)
    • Development of an enhanced infrastructure, including the creation of a new Conflict of Interest Review Committee, responsible for education, oversight and enforcement of Partners policies and practices in regard to industry interactions.
    • Strengthen oversight of permitted outside activities:
      • A ban on faculty participation in industry speakers bureaus,
      • An express prohibition on faculty being listed as authors on papers ghostwritten by others, and
      • A more rigorous internal review process for certain outside activities.
  • 53. Implementation and Rollout
    • System-wide educational initiatives.
    • Dedication of financial resources.
    • Definition of sanctions for non-compliance.
    • Target effective date of 10/1/09.
  • 54. Disclaimers
    • This summary may not be comprehensive.
    • The Partners implementation plan has not yet been implemented so changes may occur.
    • Not legal advice - please consult your attorney.
    • Not compliance advice – please consult your chief compliance officer.
  • 55. Comments Appreciated
    • Comments on this presentation are welcomed. Please email Bob Dickson your suggestions for improvement.
    • Please indicate the specific slide number that you are commenting on so the comment can be easily followed.