• PhRMA Goes Further: New Ethics Code Limits Manufacturer Interactions with Health Care Professionals
  • August 5, 2008 | Author: Gina M. Kastel
  • Law Firm: Faegre & Benson LLP - Minneapolis Office
  • The Pharmaceutical Research and Manufacturers of America (PhRMA), an association representing leading pharmaceutical and biotechnology companies, released on July 10 its revised Code on Interactions with Healthcare Professionals. The new code, which becomes effective Jan. 1, 2009, includes more stringent limitations on relationships between pharmaceutical manufacturers and the health care providers who use their products.

    New Provisions

    The revised code replaces a version released by PhRMA in 2002. Its provisions include new restrictions on meals and gifts, as well as additional requirements related to training, continuing medical education and speaker compensation.

    • Prohibition against the provision of restaurant meals by manufacturer sales representatives to health care professionals. The code will still permit manufacturer representatives who make informational presentations at a hospital or physician office to provide occasional modest meals in that setting in connection with the presentation. In addition to barring restaurant meals, the code prohibits company representatives from providing entertainment or recreation, such as tickets to theater or sporting events, sporting equipment or leisure travel.
    • Ban against the provision of non-educational gifts, even if they are practice related. Historically, the provision of practice-related items of nominal value, such as pens, note pads, clipboards and mugs, was considered acceptable. The new code states that providing such items may foster misperceptions about the manufacturer’s relationship with the health care professionals, and therefore, bans providing the items. Manufacturers may still provide educational materials for patients with a value of $100 or less. Examples of acceptable items include anatomical models, informational brochures, and patient self-assessment and tracking tools. The code affirms that non-practice-related items, such as golf balls and sports bags, should not be provided, whether branded with the manufacturer’s logo or not.
    • New training requirements for manufacturer representatives. The code requires companies to ensure their sales and other representatives (whether employed or independent contractors) receive training about the code and laws that regulate their interactions with health care professionals. Companies must also ensure their representatives have sufficient knowledge of general science and product-specific information to provide accurate information, consistent with FDA requirements.
    • More independence in supporting CME. Manufacturers who provide funding for continuing medical education (CME) should separate their CME grantmaking function from their sales function to help ensure the educational program promotes a full range of treatment options rather than promoting a particular medicine. Further, manufacturers should not provide meals at CME events under the new code.
    • More stringent requirements for speakers and consultants. The new code requires that companies cap the total annual compensation paid to each company speaker, and develop policies concerning the use of speakers and consultants. In addition, manufacturers are expected to require speakers and consultants who are members of committees that set formularies or develop clinical guidelines to disclose their work for the manufacturer to the appropriate committee to avoid actual or apparent impropriety.


    The code has always been and remains voluntary for PhRMA members. As of Jan. 1, however, new public disclosure and certification provisions will apply for companies that follow the code. The CEO and chief compliance officer of each manufacturer will be asked to certify their company’s compliance with the code and to announce their commitment to complying with the code. To encourage manufacturers to participate in the certification and public disclosure process, PhRMA will list on a public Web site the names of all manufacturers making the certification.

    The Code in Context

    The changes to the code reflect a general trend in the pharmaceutical and medical device industries toward increased transparency and efforts to ensure manufacturers do not inappropriately attempt to induce referrals and purchases through their relationships with health care providers. Further, it seems likely the expectations for drug and device manufacturers will continue to increase. Pending federal legislation known as the Physician Payments Sunshine Act is intended to require enhanced reporting of payments made by drug and device manufacturers to health care providers. A number of states have already enacted or are considering similar disclosure laws.

    Although the AdvaMed Code of Ethics on Interaction with Health Care Professionals, the voluntary ethics code that applies to medical device manufacturers, is currently less strict in some ways than the new PhRMA code, AdvaMed may revisit its standards in light of PhRMA’s changes. Drug and device manufacturers would be well-advised to review their compliance programs and ensure sufficient resources are devoted to monitoring and navigating the changing regulatory landscape.