Compliance News in Review, September 15, 2016

Illinois tackles illegal drug promotion by Insys; the ABPI calls out two member companies for breaking promotion rules; the Australian legislature shines a light on corporate crime and Medicines Australia reports on payments to doctors; and AstraZeneca settles with the SEC…all in this edition of the Compliance News in Review.

You had to know it wasn’t far away when “pumpkin spice everything” started appearing on store shelves. After the long hot summer, the staff here at the Compliance News in Review couldn’t be more excited that football is back, and cooler days with it (hopefully). Whether you’re a fan of college, or the league where they play for pay, the season is short, but that’s what makes it so special. Yes. football is now our focus, but not so much that we won’t continue to provide you with all the life sciences compliance news fit to blog. So, strike up the band, we’re ready to take the field on this edition of the Compliance News in Review.

The Illinois Attorney General is lining up against Insys. The state has filed suit against the company for illegal marketing of its fentanyl drug. The drug is approved for treating pain in cancer patients, but the AG alleges the company has been marketing the drug for treatment of other types of pain. The company also encouraged doctors to write prescriptions for higher, more expensive doses of its product, despite FDA recommendations to use the lowest dose of opioids possible, according to the suit.

The Association of the British Pharmaceutical Industry (ABPI) threw a flag on Hospira and Napp Pharmaceuticals. The organization has accused the companies of breaking the rules regarding promotion of biosimilars. An investigation found that Napp Pharmaceuticals made inappropriate payments to physicians attending a meeting that was deemed an advisory board. Hospira allegedly invited U.K. doctors to attend a meeting outside the U.K., which was a not a genuine advisory board, where their drug was promoted.

The Australian legislature will huddle about the state of its anticorruption law. After two Australian companies were implicated in a case involving the bribery of foreign officials, a member of the Australian senate decided to relaunch a committee to address corporate corruption. The mission of the committee is to improve Australia’s response to corporate crime and the senator noted that compared to bribery laws in the U.S. and U.K., Australia’s law is inadequate.

The “score” regarding industry payments to physicians in Australia has been posted for public review. Between October 2015 and April 2016 doctors received $8.5 million from industry according to a report from Medicines Australia. The organization says this report provides patients with more information than ever before about the relationship between doctors and the industry, and that the organization’s “standards for ethical and transparency will improve the Australian health care system.”

Thanks to an “ineligible receiver” call from the officials at the SEC, AstraZeneca has agreed to pay $5.5 million to resolve FCPA related charges. The SEC alleged that the company did not have proper internal controls in place related to interactions with foreign officials – mostly healthcare providers – in its China and Russian subsidiaries. The agency contends that improper payments, in the form of cash, travel, and gifts, were documented as bona fide business expenses. While AstraZeneca did not admit or deny any wrongdoing, it did cooperate fully with the investigation.

This week’s review had a decidedly foreign flavor. Where compliance outside the U.S. is concerned, we recall a quote from Pulp Fiction (bet you never thought a Tarantino film would ever be referenced in blog post about compliance) when Vincent Vega is discussing the differences between European countries and the U.S. “They have everything there we have here. It’s just a little bit different.” The same can be said for compliance issues. While the principles or requirements related to drug promotion may be the same here and abroad for the most part, there are small differences between what is permitted in the U.S. and what is permitted around the world. Life sciences companies must train employees about practices that are appropriate when conducting business outside the U.S., particularly in their interactions with non-U.S. HCPs.

With that, the time has expired on this edition of the Compliance News in Review. Don’t forget to click that blue button on the right to “follow” our blog so you’ll receive notifications when we post new content.

Until next time, stay compliant and enjoy the games!

Compliance News in Review, July 5, 2016

Another organization calls for a ban on Direct to Consumer advertising, two former industry sales reps are arrested for kickbacks, a former executive is acquitted on kickback charges, and CMS releases update TOV data.

Strike up the band and light up the fireworks! The American Experiment marked its 240th year this weekend. So, it’s fitting that the hottest ticket on Broadway these days is the story of one our nation’s founders. Since most of us won’t be lucky enough (or rich enough) to score tickets to Hamilton in celebration , we had to stick with the old standbys of parades, barbecues, fireworks. To cap the holiday weekend, we offer a new tradition to add to the list, the Independence Day edition of the Compliance News in Review.

The fireworks continue regarding DTC advertising. The American Society of Health-System Pharmacists is the latest group to express a desire to see DTC advertising of prescription drugs banned. In the past, the organization has been supportive of the advertising, as long as it meets certain criteria. Since it now believes the industry is ignoring the criteria, the group has withdrawn its support. A spokesperson says a complete ban is not possible, but he hopes this action will lead to a discussion between industry and healthcare providers about DTC ads. The current model of DTC advertising is outdated according to the spokesperson, and pharmacists and providers are spending too much time explaining to patients why drugs they see in ads are not appropriate for them.

A pair of former Insys sales representatives could be losing their independence in the near future. The two were arrested for allegedly paying over $250,000 in kickbacks to doctors who wrote prescriptions for the painkiller fentanyl. The complaint alleges that most of the money was paid for serving as speakers at programs that were essentially social functions. Very little, if any, educational information was shared, according to the complaint, and following the programs, the sales reps would often take the doctors out for drinks and other entertainment. In a statement, the company says the sales reps were no longer employed and company policy prohibits the giving of cash or other items of value as inducements for writing prescriptions.

It was no tea party in Boston for the feds in a case against a former Warner-Chilcott executive. W. Carl Reichel was acquitted of charges that he paid kickbacks to doctors. Prosecutors charged that the former executive created a strategy of paying kickbacks to doctors in the form of sham speaking fees, money, and free meals in exchange for writing prescriptions of Warner-Chilcott drugs. US Attorney Carmen Ortiz said the charges against Mr. Reichel were warranted, and while cases against executives are difficult to prove, they’re necessary to deter improper conduct.

CMS sent out its annual declaration about Open Payments data. The payment and transfer of value data has been published, and is now publicly accessible. This year’s data represents nearly 12 million records covering $7.52 billion paid to physicians and teaching hospitals. As usual, research payments account for the largest share of the total amount.

This edition of the News in Review reminds us that the consequences of non-compliant behavior can be quite personal. When the big headlines tend to be about the multi-million and multi-billion dollar settlements paid to settle charges of fraud and non-compliance, convincing individuals that there is also a price to pay can be challenging. Citing cases like these in your training is one way to inform commercial staff and executives of those consequences.

While we don’t advocate turning compliance training into something akin to “Scared Straight,” sharing the full landscape of government enforcement actions is important. This is especially true following last year’s memo from Deputy Attorney General Sally Yates about the DOJ’s emphasis on holding individuals accountable in cases of corporate wrongdoing.

That’s it for this edition of the Compliance News in Review. Stay compliant!

News in Review, June 15, 2016

Federal investigators subpoena information related to charitable organizations from three companies, Congress proposes an amendment to the FDCA, the head of the FDA speaks on off-label information, and New Hampshire’s Attorney General targets the manufacturer of a popular painkiller.

The temperatures are rising well past 70 degrees Fahrenheit and that can only mean one thing…time to hit the beach! Pack up the station wagon, minivan, or whatever mode of transportation best accommodates your gear and head to the sand and surf for some fun and relief from the heat! Of course, the standard precautions and warnings are in order: use plenty of sunscreen; mind the flags regarding ocean conditions; and above all, be wary of teens resembling Frankie Avalon and Annette Funicello bursting into fits of random dancing and singing (now there’s a dated reference for you). Of course, you’ll need plenty of reading material before you drift off into a coconut oil scented daydream. So after you finish the latest from Mary Higgins Clarke or that true crime tome, please enjoy the next best beach read…this edition of the Compliance New in Review.

The waves of compliance just got slightly chopping for a trio of drug manufacturers. Three companies, Gilead, Jazz and Biogen, received subpoenas from federal investigators for information related to their relationships with charitable organizations that help patients with medication costs. Charities receiving support from industry companies claim those companies have no say or influence on which patients they help or what drugs are covered. The government’s concern centers on whether the contributions are essentially illegal kickbacks.

Oh sunny day – a panel of the House of Representatives Energy and Commerce Committee proposed an amendment to the Food, Drug and Cosmetics Act that would allow companies more leeway in sharing truthful off-label information. The proposed amendment would limit the definition of intended use to the manufacturer’s “objective intent,” and allow for the dissemination of materials for scientific exchange, if the information in the materials is backed by scientific evidence. The panel expressed concern about the need for doctors to be kept abreast of the latest medical information, and frustration at the lack of movement by the FDA on guidance related to the dissemination of off-label information.

The head of the FDA also rode the off-label promotion wave when he spoke at the BIO International Convention. In his remarks, Robert Califf noted that supportable information worth sharing should be included on the product’s label, and he questioned why companies would not include useful information on the label or in the prescribing information. Califf also encouraged the industry to embrace social media, saying, “the best way to develop products in the future is likely going to involve a lot of people with diseases to have a handle on what their needs are, what their expectations are, and what their risk tolerance may be.”

As expected, Vermont was first in the water with a law requiring transparency of drug pricing. State officials will identify 15 drugs for which they want information about the reasons for price increases. The manufacturers of those drugs will have to submit information to justify the price increases.

New Hampshire Attorney General’s office has filed suit against Purdue over the company’s refusal to provide documents related to the marketing of OxyContin. The AG’s office claims the company is providing HCPs with misleading information regarding the product. The suit claims the company touts the drug lasts for 12 hours, and it also does not appropriately address end-of-dose failure. The AG also claims the company downplays the risks associated with addiction. Purdue says it is more than willing to cooperate with the investigation, provided the AG’s office does not share any documentation with private attorneys. The company believes a financial conflict of interest exists with the firm retained to assist in the investigation, and it should not be compelled to turn over information while a court case is pending.

A report from Reuters questions the independence of firms hired by companies under a CIA to serve as an Independent Review Organization (IRO). Unlike other agencies, the Department of Health and Human Services does not prohibit companies under a CIA from hiring an IRO with which they have an existing relationship. Critics claim those arrangements represent a conflict of interest. A representative of the HHS Office of Inspector General (OIG) said she has not witnessed any issues with these arrangements. Spokespersons for various industry companies said they disclose all their business relationships to the OIG in advance.

The seas have also been choppy for Salix Pharmaceuticals recently. The company agreed to pay $54 million to settle allegations it provided kickbacks to physicians for prescribing its products. According to the DOJ, the company admitted to paying doctors to be speakers for the company as an inducement for prescribing its products. The government claims the programs at which the doctors spoke were largely social in nature and provided little or no information related to a product. In addition to resolving the federal case, the settlement will resolve several related state fraud cases.

That’s all for this edition of the News in Review. Until next time, we wish you safe sailing and calm compliance waters!

News and Notes from the 13th Annual Pharmaceutical Compliance Congress

CBI’s 13th Annual Pharmaceutical Compliance Congress, held last week at the Ritz-Carlton in Washington DC, offered an impressive lineup of industry luminaries and government regulators discussing a wide range of compliance-related topics. While some of the discussions didn’t offer much in the way of groundbreaking information (tone at the top, embed compliance in the businesses, relationships matter, etc.), the concepts presented were critical for any attendees new to their role or the world of life sciences compliance in general.

Embed Compliance into Business Practices

There was the expected emphasis on the concepts of embedding compliance into business practices and gaining buy-in from the C-suite. One panelist even mentioned that when asked to join her current company, she insisted that she be a member of the North American leadership team and therefore have direct access to the business leaders. As another speaker put it, “relationships matter, and you have to speak the language of the businesses in their terms.”

Tie Compliance to Incentives

One compliance officer from a small pharmaceutical company referenced the need to make sure sales incentive is tied to compliance, to make the concepts and policies more meaningful – a concept that was considered revolutionary in the industry just a few years ago. She added that sales management needs to own the compliance metrics in order for there to be lasting and real change. The same global officer touched on the challenges of doing business globally and the need to have tough conversations about spending caps. “You will get pushback,” she stressed, “but don’t compromise. There’s no need to take that kind of risk.”

Transparency: Think Globally, Act Locally

Continuing on the global front, presenters reviewed the merits and details of global transparency codes like EFPIA, while touching on upcoming movements toward laws and guidance. When dealing with global regulations and codes, the potential for confusion reigns. For example, when providing meals to HCPs from various countries, one panelist advised audience members to use the lowest common denominator for the meal limit, BUT, don’t forget to take Loi Bertrand into consideration if an HCP happens to be from France.

In addition, panelists stressed that companies can’t fall into the trap of thinking that because they are familiar with the rules around the Sunshine Act and Open Payments, they can roll right into global reporting. As one speaker from a large pharmaceutical company suggested, you have to look at it differently. “If you approach it like you approach Open Payments, your credibility will be challenged.”

Yates Memo and Individual Culpability

Among the regulators and defense attorneys who spoke during the conference, one common theme was the Yates Memo, and the affect it has (or is some cases, doesn’t have) on how investigations are conducted and cases prosecuted. The Memo, which is named for Department of Justice Deputy Sally Quillian Yates, was released in September of 2015. It generally states that the DOJ will increasingly target individuals in corporate crimes. A number of the regulators stressed that while the Memo is significant in its scope, it will not necessarily change how their offices pursue pharmaceutical and medical device cases. During the U.S. Healthcare Fraud Enforcement Panel, one US Attorney said it “codifies what they have already been doing in her office” and another commented that he asks his prosecutors to always look at individual culpability in each case.

Innovations in Training

As a compliance-focused learning company, we at PharmaCertify™ pay close attention to presentations and commentary with a slant toward training. It’s been a slow process, but based on the information and concepts presented in this and other recent conferences, it’s clear to us that companies are integrating exciting and novel techniques into their curriculums. Innovative compliance departments are adding micro-learning solutions and app-based tools in an effort to raise the level of engagement among their learners, which is music to our ears.

One company representative detailed the planning process and upfront analysis she and her colleagues conduct to ensure that training concepts meet the needs of the business as well as the compliance department. Once those needs are identified, they look for unique ways, including a healthy dose of humor, to make their messages stick. She and her co-presenter reviewed the details of the compliance app recently launched across the company, which uses self-produced video sequences, with compliance department employees as actors, to communicate the concepts. While we agree that technique can help to “humanize” compliance, as we warned in a recent post, you need to be careful that bad acting doesn’t distract from the important messages.

While this year’s Pharmaceutical Compliance Congress featured much of the same themes as recent conferences, the ever-evolving world of life sciences compliance always offers new twists and turns for those tasked with ensuring their individual companies remain in alignment with the latest rules and regulations. These conferences offer attendees the invaluable opportunity to learn best practices, tips, and updates directly from their peers and government regulators from around the world. They shouldn’t be missed.

See you at the next conference!

Compliance Edutrainment: Too Much of a Good Thing?

These days, the standard airline safety presentation is delivered via video on most aircraft. Somewhere along the way, airlines decided this approach was an opportunity to express their creative spirit, and a bit of a competition developed, with the imagined spoils going to the company that produces the most entertaining safety video. That competition reached a new level when Virgin America rolled out its Safety Dance video. It boasts talented singers and dancers (and one Olympian) delivering the FAA- required safety information. If the objective is simply to entertain, then mission accomplished. However, if the objective is to educate passengers about safety protocol, we’re not sure it hits the mark.

The world of compliance training has thankfully evolved beyond the “death by PowerPoint” approach that dominated the life sciences landscape years ago. Those charged with developing compliance training now look to create programs that are more engaging and entertaining. In the case of eLearning, a number of tools and techniques can be applied to deepen engagement and learning, but if overused, or misused, the same tools have the opposite effect and distract from the learning. We call this the Edutrainment Trap.

All good adult learning starts with objectives, answering the question, “What do I want the learner to know and be able to do by the end of this training?” Enamored with the latest tools and ideas, losing sight of objectives once we start to design and develop the learning is easy. Here are five tips to help keep your compliance organization from falling into the Edutrainment Trap:

  1. Use Interactivity Intelligently: The interactivity itself is often overused in online compliance training. Of course, a well thought-out level of interactivity is important, but overloading the interaction on every screen only serves to distract the learner from the salient points. When covering critical topics like off-label marketing and privacy, interactive exercises and games need to be integrated intelligently, and in a manner that doesn’t cloud the learning with unnecessary messages. Interactive elements should serve a purpose, and not just be included for the sake of entertainment.
  2. Include Targeted Imagery: Images and graphics are sometimes misused or overused in a way that distracts from the core objectives. There is truth to the phrase, “a picture is worth a thousand words” and well-placed imagery is certainly more engaging than an overabundance of text on screen. But when the objective is to ensure the learner can “demonstrate an understanding of the payments that need to be reported under the Sunshine Act,” pretty pictures only go so far. Relevant images and graphics that reinforce key concepts and support learning objectives are needed.
  3. Mind the Bandwidth: Video and animation offer exciting opportunities for compliance training, but like any new tools, they need to be utilized judiciously and with the objectives in mind. In this time of high-speed corporate networks, we can forget that bandwidth is sometimes an issue for third-party vendors. An overabundance of video or complex animations may cause problems. Think carefully about geography and access when developing that global transparency module for deployment around the world.
  4. Remember that Acting Counts: If live actors are being used, make sure the subject matter remains the star of the training. Oscar-quality acting isn’t necessary for the training to be effective, but there is a fine line between amusing amateur acting and just plain bad acting. When the goal is to communicate the seriousness of a topic like the Anti-kickback Statute and its implications, amateur acting will derail any hope for effectiveness, as the learners start to pay more attention to the acting, and not the learning. Similarly, the more conversational the dialogue, the better. If the narration sounds like someone is reading a law journal or compliance policy, learners will tune out.
  5. Be Mindful of Cultural Differences: Making cultural references or using humor can be a fun way to interject life into training, but it has to be included carefully. Jokes can lessen the importance of the message. Cultural references that the audience may not understand can frustrate and ultimately distract the learner, leaving them saying “huh?” instead of “I got it.” This safety video by Delta is a great example. The video is entertaining, funny, and clearly communicates the required safety information – all good things. However, if the learners are not familiar with the nature of viral videos and Internet stars, the humor is lost, and the random assortment of characters only leads to confusion.

Avoid the Edutrainment Trap of loading training with every bell and whistle imaginable in the effort to make the learning fun and engaging. A good balance of imagery, text, and interactivity keeps training interesting and flowing and is a necessity in today’s complex regulatory landscape. Understanding which techniques are most effective and appropriate for the learners and the subject matter is the key to developing effective and highly-engaging training.

Thanks for reading and stay compliant!

The 2016 Pharmaceutical Compliance Congress: a Preview

On April 26 and 27, compliance professionals and government representatives will gather in Washington, D.C. for the 13th Annual Pharmaceutical Compliance Congress. As usual, the conference offers a cornucopia of sessions and workshops focused on important compliance topics. There is plenty to see and learn, but here are the topics that have piqued our interests:

Day One General Session: FMV Considerations and Emerging Compliance Risk – In this age of transparency, FMV is a hot topic for life science companies and healthcare providers alike. This session, along with the breakout sessions on the same topic, offer a great opportunity to identify emerging risks related to FMV, and learn best practices from industry colleagues.

Day One General Session: EFPIA Initiatives for 2016 and Beyond — Charting the Course for Global Transparency – EFPIA members have completed their first year of data collection to comply with the Disclosure Code. We’re hoping to hear about the early challenges companies are facing and EFPIA’s plans for the future of its transparency initiative.

Day One Track: Product Promotional Compliance – In particular, we are interested in two sessions:

Social Media — New Challenges and Opportunities: While social media presents a unique set of challenges, its affect on life sciences marketing and compliance has to be taken into consideration.

Speaker Programs and Medical Roundtables — Environment and Areas of Risk: In this era of increasing scrutiny, we’re specifically interested in hearing about the emerging risks surrounding roundtables and the strategies for mitigating those risks.

Day One Workshop: Analyze FCPA Updates and Identify Areas of High-Risk to Mitigate Non-Compliance, paired with the Day Two General Session FBI address, International Corruption Squads – the FCPA and Beyond – At the end of 2015, the DOJ announced that it planned to hire 10 additional attorneys for its Fraud Division FCPA Unit. Also, the Serious Fraud Office entered into its first corporate Deferred Prosecution Agreement for violation of the U.K. Bribery Act last year. Enforcement of anti-corruption laws continues to be a priority for the U.S. and governments abroad. Learning about the emerging risk areas, and how various agencies cooperate in enforcement, is key to ensuring that your anti-corruption program is covering all the right bases.

Day Two Track: Fraud, Abuse and Kickback Prevention – The scrutiny of payments to physicians is only going to increase as more entities comb through transparency data. Concern from investigators and enforcement agencies about the potential for kickbacks is growing. The discussion on anti-kickback enforcement trends, and the establishment of compensation limits will be helpful when addressing your organizational kickback risks.

Day Two Discussion Group: Focus on Pricing – Considerations for Compliance as Scrutiny Heats Up – Last year, we saw the largest settlement ($12.4M) under the OIG’s Civil Monetary Penalties Authority. The settlement was over price misreporting, and enforcement in this area isn’t about to let up. This session presents a great opportunity to learn about best practices and the challenges compliance professionals are facing regarding government pricing.

Day Two Track: Compliance Program Structure and Effectiveness – Engage the Organization to Promote Ethics within Compliance

Okay, we may be a bit biased on this one, since Peter Sandford from NXLevel Solutions is one of the presenters, but as your training audience evolves, so should your compliance training. As millennials bring a new sense of energy and expectations to the industry, implementing modern and innovative learning strategies is more important than ever. Peter and his co-presenter, Jim Massey – Vice President, Global Compliance, Enablement & Assurance, AstraZeneca, will share five key principles for integrating creative and engaging compliance training into your organization.

We invite you to stop by the NXLevel booth to see demos of our compliance-focused training solutions and to share your thoughts on the sessions. And while you’re there, don’t forget to enter our drawing to win a Bose® SoundLink® Bluetooth speaker.

Stay compliant and we’ll see you in Washington!

Compliance News in Review, December 10, 2015

One of the great traditions of the Christmas season is the performance of Tchaikovsky’s The Nutcracker by ballet companies and dance schools around the world. Whether performed by professionals or students, the ballet is full of magic and fantasy. A young girl, Clara (or Marie, depending on the production), receives a nutcracker, which comes to life, fights an army of giant rats, and then whisks Clara away to land of sweets ruled over by the Sugarplum Fairy. Almost as delightful as the prospects of watching giant rodents fight on stage is what’s been happening in the world of life science compliance. Places everyone! Time for the Compliance News in Review.

Standard Bank is taking a bow as the first company to enter into a deferred prosecution agreement (DPA) with the Serious Fraud Office over violations of the U.K. Bribery Act. The company was accused of failing to prevent bribery by an allied person. The DPA remains in effect for three years and requires the bank to pay $32.6 million; submit to a review of its anti-bribery policies by an independent reviewer and make any changes recommended by the reviewer; and cooperate with authorities in any other matters that arise from the indictment.

It’s not a dream Clara, the DOJ announced it has recovered $3.5 billion in False Claims Act cases in 2015. As in years past, healthcare fraud represented the lion’s share of the recoveries. In 2015, healthcare fraud cases totaled nearly $2 billion. Cases against the pharma industry represented $96 million of that total. It was a good year for qui tam relators as well. Of the $2.8 billion recovered from qui tam cases, a record $1.1 billion came from cases in which the U.S. chose not to intervene.

Harvard Medical School has made a slight change to its conflict of interest policy. The school is relaxing a policy that prohibited faculty from accepting equipment or other support from a private company in which they have equity, or from a public company in which they hold equity of $30,000 or more. The school will now allow faculty conducting basic research to petition for an exclusion from the rule if they can show that the benefits of the research outweigh any potential conflict of interest. Faculty would also need to show they have measures in place to guard against conflicts of interest.

Physicians may need Uncle Drosselmeyer to come guide them through the Sunshine Act sine a new study shows professional medical organizations aren’t doing so. The study appeared in the journal, Postgraduate Medicine. Researchers reviewed 59 articles and found there was very little guidance regarding the Act, and professional associations tended to focus on sharing broad information about reporting requirements. Rarely was there information regarding payments for research grants, trial participating and medical publication. The authors conclude that expert guidance about the Final Rule itself is needed, and suggest a lack of guidance may impact physician investigators’ participation in clinical trials and publishing results.

Clara’s trip to the land of sweets may have all been a dream conjured up by the mysterious Drosselmeyer, but after years of anticipation, the SFO is making its promise of dealing with corporate bribery a reality. In addition to the Standard Bank DPA, another corporation was recently charged by the SFO with violating the U.K. Bribery Act by failing to prevent bribery. If the lack of prosecutorial action has made training on the U.K. Bribery Act a lower priority for you, now is the time to move it up the priority list. Likewise, if you haven’t trained on the Act recently, a refresher course may be in order to ensure employees and third parties are up to speed on the requirements and your company’s policies.

That’s a wrap for this edition of the Compliance News in Review. Keep dancing everyone…and stay compliant.

Compliance News in Review, November 16, 2015

The OIG 2016 Work Plan is released, the House of Representatives form a task force to combat rising drug costs, a Massachusetts HCP is indicted in the Warner Chilcott case, and CMS releases informational charts to help clear Open Payments confusion.

He’s an international man of mystery, who’s licensed to kill, and he is back in theaters for you viewing pleasure. He’s Bond, James Bond. The latest installment of the series, Spectre, has hit theaters. The reviews are mixed, but hey, all we ask out of a Bond film is a good vodka martini (shaken, not stirred), spectacular gadgets, and a good chase sequence or two. Whilst we check local screening times, we’ll leave you with our own top secret document to peruse, this edition of the Compliance News in Review.

For Your Eyes Only, it’s the OIG 2016 Work Plan. Okay, it may not be top secret, but the 2016 plan is out and it reveals some interesting news for pharma and med device companies. You may recall that in the 2015 Work Plan, the OIG said it would review the financial interests reported under the Open Payments Program. In this year’s Plan, the agency has slightly revised this initiative (revision in bold):

“We will determine the number and nature of financial interests that were reported to CMS under the Open Payments Program. We will also determine the extent to which CMS oversees manufacturers’ and group purchasing organizations’ (GPOs’) compliance with data reporting requirements and whether the required data for physician and teaching hospital payments are valid.

Previously, the Work Plan stated the OIG would review whether the required data was reported “accurately and completely displayed in the publicly available database.”

U.S. House and Senate members have no Quantum of Solace regarding drug prices in wake of some recent high profile drug price hikes. In the House, a group of Democrats have formed the Affordable Drug Pricing Task Force to pursue “meaningful action to combat the skyrocketing costs of pharmaceuticals.” In the Senate, the Special Committee on Aging is set to investigate large spikes in drug prices. The Committee sent letters to Valeant, Turing Pharmaceuticals and two other companies for information regarding recent large increases in drugs sold. The Committee also requested a face-to-face meeting with the CEO of Turing. Both Valeant and Turing have also received subpoenas from federal prosecutors regarding their drug pricing policies.

A Massachusetts gynecologist was indicted on several different charges including a count of violating the Federal Anti-kickback Statute in connection with Warner Chilcott case. The indictment also seeks criminal forfeiture of $23,500. If found guilty, the doctor could face up to 11 years in prison and fines up to $325,000.

CMS won’t Never Say Never Again to the inclusion of Open Payments data on the Physician Compare website , but it is a no for now. After receiving comments and some consumer testing, it was determined the data is different that data presented on the Physician Compare website. CMS will continue to conduct tests with consumers to determine how best to frame the data.

In the past, the hierarchy associated with teaching hospitals has confused The Living Daylights out of reporting organizations that try to determine how to report payments in the Open Payments system. CMS hoped to clear the confusion by providing a couple of during a recent webinar. One chart is intended to help reporting organizations determine when and how to report payments to teaching hospitals. The other is an organizational chart to help show how the various entities roll up to a teaching hospital on the CMS teaching hospital list. Other topics covered during the webinar included record validation changes for 2015, and how to report stock and stock options as forms of payment.

CMS has been working diligently to improve the Open Payments system. The recent news of improvements offers a good reminder for companies to survey their programs, to make sure  all of the pertinent information related to the changes is being communicated. While the process of preparing systems to handle those changes is important, stakeholders such as sales, R&D, and vendors also need to be aware of how those changes affect their interactions with customers. On-going training is critical.

Well, that’s all the compliance news fit to blog for this edition. Have a great week everyone!

CBI’s 9th Annual Forum on Transparency and Aggregate Spend: A Review

CBI’s recent Forum on Transparency and Aggregate Spend covered a variety of topics affecting the collection and reporting of aggregate spend data. The conference featured speakers from industry, government agencies, and service providers sharing lessons learned and best practices related to aggregate spend collection and data disclosure.

After a day of pre-conference workshops, the main conference began on Day Two, and it started with a bang. The keynote address, An Update on Open Payments Reporting, was delivered by Doug Brown, CMS Group Director, Data Sharing and Partnership Group, Center for Program Integrity. Mr. Brown shared statistics on the data submitted for the 2014 reporting year. 11.4 million records were received, covering 600,000 individual physicians. In a vast improvement over the previous year, 98% of submitted records were accepted. Brown attributed this improvement to the introduction of the validated physicians list (VPL) and better data matching. An analysis of rejected records is underway, and CMS is looking for ways to improve the taxonomies associated with covered recipients.

During the review and dispute period, CMS received 30,000 disputes on 25,000 unique records. The disputes were evenly distributed among the covered recipient type, with physicians representing 35% of disputes, teaching hospitals 38% and principal investigators 27%. According to Brown, disputes were evenly split between the general and research payments reports. Very few disputes were lodged against payments reported on the ownership report. The median value of total payments is 4.5 times greater for registered physicians versus unregistered physicians.

Brown also shared information regarding the anticipated enhancements to the Open Payments system. The restrictions around special characters in the text fields will be removed (cue the heavenly choir). CMS is also working to better facilitate the review and dispute process. According to Brown, many of the disputes were not true disputes, but could better be classified as inquiries. CMS is working to provide a method for distinguishing between a payment inquiry and a payment dispute. The agency is also working to enhance the ability for manufacturers to download their data from the site, regardless of the file size, and it hopes to extend this capability to covered recipients as well.

Brown reminded the group that new de minimums payment information and the list of teaching hospitals will be released on October 1st. CMS is planning more Q&A teleconferences in the future. Speaking of which, during the Q&A period following the presentation, Brown was asked about having a moderator on teleconferences to alleviate the “wild west” that currently exists when the call opens up for participant questions. He said that was something he would absolutely consider, but he prefers the conversational style of the current format.

William Killian, U.S. Attorney for the Eastern District of Tennessee, and Jacob Elberg, Chief, Healthcare and Government Fraud Unit, of the U.S. Attorney’s Office for the District of New Jersey, also presented on behalf of the government. They discussed current trends in government enforcement. Mr. Killian said emerging enforcement trends in his and other offices involved fraud related to Medicare Part D, lab services, hospital services and hospice care. He noted that the civil and criminal prosecutors are often involved in parallel prosecutions. Mr. Elberg referenced a continuing trend in his office involving the prosecution of kickback cases. He said those cases are typically at the individual practitioner level, and occur locally or globally. Cases that involve activities outside the U.S. can implicate the FCPA and his office shares information with FCPA fraud units. Elberg also discussed other continuing trends involving FDCA prosecutions, including those involving off-label promotion and cGMP violations.

Rounding out the “law-focused” presentations for the day was a presentation about state laws by Brian Bohnenkamp of King & Spalding. Mr. Bohnenkamp led off by discussing federal pre-emption and how it relates to state reporting. He noted that there are times where the reportable items under federal law are not reportable under state law (and vice versa), and reminded the audience of the criteria for pre-emption under the Sunshine Act. He suggested that decisions on whether pre-emption should be applied to a particular payment should be made on a case-by-case basis. He also noted that they are seeing more companies take advantage of federal pre-emption in reporting under state laws, and used the example that a number of companies did not have anything to report under Minnesota’s law due to that pre-emption. Bohnenkemp also highlighted the recent exemption in D.C.’s detailer licensing requirement for individuals who are involved in detailing for “less than 30 consecutive days per calendar year,” and he reviewed prescription drug pricing transparency proposals in a handful of states – one example being Massachusetts, which still had not provided guidance about quarterly meal reports reported under that state’s law.

The majority of the rest of the Day Two sessions focused on data and processes directly related to interacting with the Open Payments system. Sessions and panel discussions covered topics such as leveraging the data within the organization; using data to minimize compliance risk; and remediating data and the data attestation in Open Payments. Two key themes emerged: 1. Clean data is key (the garbage in garbage out idea) and 2. Communication with the organization and those outside the organization (your vendors and physicians) about the data is critical.

A number of speakers and panelists in the sessions stressed the importance of consistency in names, addresses, and format for physician ID numbers across the various in-house and vendor systems that house spend data. A periodic review of the data is an important best practice to deal with any issues along the way. Most panelists and speakers felt that a quarterly review was an achievable goal. More frequent reviews would be ideal, but could prove a challenge for companies with fewer resources. In addition, companies should engage the business early and often about what the data reveals and how that information can be leveraged to reduce risk and impact sales. Communication with physicians in advance of the CMS review and dispute period was recommended. This does not necessarily mean disclosing all the data, nor pre-disclosing to every physician about whom you have data. Setting a minimum TOV threshold for pre-disclosure, or pre-disclosing only to select KOLs were suggested as means of making the pre-disclosure beneficial to both the physician and the company.

Speaking of physicians, Day Two included a panel discussion moderated by PhRMA Executive Vice President and General Counsel, John Murphy, on the physician’s perspective of Open Payments. Panelists included Dr. Maya Babu of the Mayo Clinic and AMA Board of Trustees member, and Dr. David Barbe, former Chair and current member of the AMA Board of Trustees. The panelists said the main concerns of physicians are centered on the potential for bad data being presented to public, the ability for physicians to access the data, the implications of the data, and the impact the Open Payments program will have on relationships with the industry. While there have been improvements in the registration process, there are still issues with access, specifically, problems with particular browsers being able to access the site. The panelists felt strongly that being able to access the data through a site set up by the manufacturer would be helpful, or even having a sales rep provide the data personally.

The United States certainly hasn’t cornered the market on physician spend transparency. Global transparency was addressed on Day Two, predominately in a discussion group at the end of the day. On Day Three an entire morning track was dedicated to issues related to global transparency. The featured presentation (and highlight of the conference) was an address by Andrew Powrie-Smith, Director of Communication for the European Federation of Pharmaceutical Industries and Associations (EFPIA).

Mr. Powrie-Smith briefly covered the nuts and bolts of the EFPIA Disclosure Code before turning to a discussion of transparency in general. The industry believes transparency is about demonstrating that there is value in the collaboration between industry and healthcare professionals/organizations, which ultimately delivers better patient care. However, being transparent is not without its challenges. Primarily, with the exception of countries, such as France, where there are physician spend disclosure laws, managing transparency efforts in face of the EU privacy laws is challenging. The EFPIA Disclosure Code requires the disclosure of certain transfers of value at the individual practitioner level, and requires that disclosure to be made available to the public. In order to meet these requirements, companies must obtain consent from physicians to disclose private information about them. Further complicating the matter is that even if consent is given, it can be revoked at any time.

Mr. Powrie-Smith said EFPIA is currently conducting a survey regarding the industry stance on obtaining the necessary consents for disclosure of transfers of value at the individual level. Thus far, EFPIA has seen a large variance in the rate of consent across Europe. A culture shift is necessary to address the variance and the industry must take a leadership role in that shift.

The concept of gaining and managing consent was emphasized in other presentations as well. Representatives from BMI Systems shared data on the rates of consent presented by various pharmaceutical industry trade organizations at an EFPIA meeting in May. In Germany, the consent rate was 50-55%, and the industry trade organization in the country said that was about what they expected for the first year. Poland’s trade organization noted in March they were at a 20% consent rate, and Spain’s trade organization reports only a 10% consent rate. Representatives from IMS Health dug into issues with gaining consent as well. They discussed how codes and laws differed from country to country, specifically regarding the timelines for obtaining consent (e.g., at time of contract, or at any time during the reporting period); the scope of the consent (e.g., per activity type, per contract); from whom consent is required (e.g., HCPs or HCOs); and required consent documentation (paper or digital).

The 9th Annual Forum on Aggregate Spend and Transparency offered useful information for any attendee responsible for data collection, report submission, or analytics inside or outside the U.S. Beyond the nuts and bolts of aggregate spend, the presentations focused on the value of the data for the organization and the physician. Data provides insight for commercial teams and their programs, and the compliance risks for the company. Most importantly, as communicated by Andrew Powrie-Smith, transparency around spend data is important, because it reveals the benefits of the industry/HCP relationship to patients, payers and the public.


Looking Ahead: CBI’s 9th Annual Forum on Transparency and Aggregate Spend

The release of the first full year of data under the Open Payments Program is just around the corner, which naturally means transparency and aggregate spend are top of mind these days. Will the data be released without any issues? How will the media react?

With aggregate spend on the mind, the NXLevel Solutions PharmaCertify™ team is looking with interest at the conference agenda for CBI’s 9th Annual Forum on Transparency and Aggregate Spend. We’ve selected a few sessions of particular interest.

Here’s what caught our attention:

Strategies to Reduce Compliance Risks and Optimize Commercial Programs Using Transparency Analytics – Obviously, companies are collecting mass amounts of data to comply with transparency requirements here and abroad. Analyzing the data to identify potential compliance risks is a great way to help fine tune training as well. For example, such an analysis may reveal areas where more in depth training is needed, or it may identify a new audience that needs training on a particular topic. We’ll be interested to hear how training fits into the agenda for this session.

State Disclosure Laws – Preemption, Enforcement and Continued Reporting – Just when we thought the Sunshine Act would clarify state reporting requirements, more changes have arrived in our in box; the latest requiring the reporting of payments to nurse practitioners in a couple of states. This session looks to be a great opportunity to learn the latest in state requirements, and to hear how those states plan to utilize the federal data.

HCP Perspectives on Transparency – Impact and Opportunities Moving Forward – Applicable Manufacturers are not the only ones affected by the Open Payments Program and other transparency initiatives. With little to no voice in the matter, healthcare professionals bear the brunt of having information about them exposed to the public. Understanding HCPs’ transparency concerns is a critical step in training those who interact with HCPs.

The Global Transparency track, which includes a session on Building a Global Transparency Solutions Center, is dedicated to the transparency requirements of the European Federation of Pharmaceutical Industries and Associations (EFPIA). With reporting beginning next year, EFPIA requirements are no doubt a hot topic, but EFPIA’s requirements aren’t the only ones of concern outside the U.S. Understanding the requirements of each code and law and finding commonalities is important when building the systems to manage the data, and building effective training around these requirements. Can training be repurposed from one jurisdiction to another? What “lessons learned” from one location can be applied as more associations and countries implement transparency requirements?

In between conference sessions, we invite you to stop by the PharmaCertify™ booth to discuss your global transparency training challenges in more detail. We’ll be providing demos of our TOV Disclosure Portal™, an exciting new product that gives your company the opportunity to roll out transparency payment data to your partner HCPs for their review and approval before it is submitted to CMS. When disputes are resolved early, HCPs are more confident in the accuracy of the data, and the company/HCP relationship is enhanced. And, if you have to miss this year’s conference, contact Sean Murphy at

Stay compliant and we’ll see you in August!