By Deborah J. Robinson, Esq.
The world of interaction between the pharmaceutical industry and physicians has changed dramatically due to both an increasing emphasis by the federal government on both the compliance efforts of the pharmaceutical industry as well as their relationships with providers (through fraud alerts, investigations and Compliance Guidance), as well as by formalized responses from the pharmaceutical and medical communities to this heightened attention. Increasing regulatory tension has translated into industry groups and professional associations working toward self-enforcement efforts and guidance for its members. The purpose of this article is to highlight one aspect of the new compliance efforts: boundaries between physicians and the pharmaceutical industry.
On May 5, 2003, the Department of Health and Human Services and the Office of Inspector General published in the federal register the “OIG Compliance Program Guidance for Pharmaceutical Manufacturers.” This final guidance was the outgrowth of an effort which began on June 11, 2001 when the OIG published a solicitation notice asking for information and recommendations for developing compliance program guidance for the pharmaceutical industry. Thus began a concerted effort by both the government, the pharmaceutical industry and, eventually, the medical community to identify the need for enforcement guidelines. Although the Compliance Program Guidance is voluntary and specifically targets the pharmaceutical manufacturing industry, its implications for physician practices are broad and have been regarded as such by the medical community.
The document sets forth the whole structure for the industry in how to develop and implement a Compliance Plan. The structure is consistent with the format physicians are familiar with and which has been promulgated for other health care entities. In addition, the Guidance highlights risk areas. The Compliance Guidance identifies three specific risk areas: (1) the integrity of data used by state and federal government to establish payment amounts, (2) kickback and other illegal remuneration, and (3) compliance with laws regarding drug samples.
The emphasis of this article is on the general area of relationships which could be characterized as involving kickbacks and other illegal remuneration. The need for Guidance on kickbacks and other illegal remuneration is based on the fact that the anti-kickback statute ultimately turns on a party’s intent and the prohibitions are not as clear cut. Importantly, the OIG gives clear guidance as to those types of arrangements which are considered to be suspect.
The Guidance first identifies a conceptual analysis in looking at individual relationships.
Does the arrangement or practice have a potential to interfere with, or skew, clinical decision-making? Does it have the potential to undermine the clinical integrity of a formulary process? If the arrangement or practice involves providing information to decision-makers, prescribers or patients, is the information complete, accurate and not misleading?
Does the arrangement or practice have the potential to increase costs to the federal health care programs, beneficiaries or enrollees? Does the arrangement or practice have the potential to be a disguised discount to circumvent the Medicaid Rebate Program Best Price calculation?
Does the arrangement or practice have the potential to increase the risk of overutilization or inappropriate utilization?
Does the arrangement or practice raise patient safety or quality of care concerns?
After giving this general analytical framework, the Compliance Guidance continues by identifying categories which could suggest illegal remuneration. The categories most relevant to a physician’s relationship with the pharmaceutical representatives are: (1) switching arrangements (marketing practices utilizing switching payments in connection with products reimbursable by federal health care programs), (2) consulting and advisory payments, (3) business courtesy and other gratuities, and (4) educational and research funding.
Given the interests of the Pharmaceutical, Research and Manufacturers of America (PhRMA) as a stakeholder in the development of this Compliance Guidance, it is not surprising that the PhRMA Code specifically addresses these particular interactions in a document entitled: “PhRMA Code on Interactions with Health Care Professionals.” As a summary statement, this organization has also published under “Quick Facts” a summary of the general categories with some commonsense examples:
General interaction: Interaction should focus on informing the health care professional about scientific and educational information and supporting scientific medical research and education to maximize patient benefits.
Entertainment: Interaction should not include entertainment. Interaction should occur at a venue conducive to providing scientific or educational information. Specifically, this means no “dine and dash,” no entertainment, and no recreational events (for example, sporting events or spa visits).
Continuing education: Companies can provide support to the conference sponsor but should not fund individual participants. That means, a company should not pay an individual’s tuition, but could provide support to the event sponsor. That sponsor may in turn provide grants to individuals to participate, or to reduce the overall registration fees for all attendees.
Consultants: Legitimate consulting or advisory arrangements are appropriate but token consulting arrangements should not be used to justify payments to health care professionals. Characteristics of legitimate consulting arrangements include the retention of professionals based on their expertise, not as a reward or inducement for prescribing, and retaining no more consultants than needed for the specific program. For example, it would be inappropriate to retain 10,000 physicians for a program that requires no more than 1,000, or to select them as a reward for high prescribing.
Educational and health care practice-related items: Educational and practice-related items may be provided to health care professionals, but should be for the health care benefit of patients and of less than substantial value (100 dollars or less). Items for the personal benefit of the health care professional should not be offered or distributed. In short, nothing should be offered or provided that would interfere with the independence of the health care professional’s prescribing practices.
The medical profession, through the AMA, has also worked to establish its own guidelines for physicians within the context of their general education efforts and the AMA Council on Ethical and Judicial Affairs. As a supplement to the above guidelines, it is interesting to note that the AMA has launched a national initiative on “The Communication of Ethical Guidelines on Gifts to Physicians from Industry.” Although this is not specifically adapted to PhRMA Code issues only, the commentary as well as a reference to “frequently asked questions” generally mimics the advice given under the PhRMA Code. The educational materials are available indefinitely on the “Gifts to Physicians from Industry” website and can be found at www.ama-assn.org/goethicalgifts.
Unlike the PhRMA Code guidance, the AMA has not altered its established ethical opinions. For example, CEJA Opinion 8.06 states: “A physician should not be influenced in the prescribing of drugs, devices, or appliances by a direct or indirect financial interest in a pharmaceutical firm or other supplier. Whether the firm is a manufacturer, distributor, wholesaler, or repackager of the product involved is immaterial.”
In addition, Opinion 8.061, “Gifts to Physicians from Industry” generally recognizes that gifts may be beneficial and service a legitimate purpose, but that physicians are to be guided by general ethical guidelines when accepting those gifts. The general principles are parallel to the PhRMA Code of without the specific industry examples. Looking to both should serve the purpose of anyone looking for guidance.
In summary, working through both the OIG’s Guidance, the PhRMA Code instructions as well as the AMA’s initiatives in this area, physicians should be able to identify the boundaries of permissible relationships with pharmaceutical representatives. One clear sign of the times is now a common practice in physician office buildings and physician offices where signs are frequently seen which state: “Pharmaceutical representatives seen only by appointment.”
Deborah J. Robinson, Esq. is a Director in the Pittsburgh law firm of Houston Harbaugh and is its Health Law Practice Group Chair.