States Add Pharma, Medical Meeting Regs

New health codes require disclosure.

Effective July 1, new state codes of conduct in Massachusetts and Vermont will require pharmaceutical and medical device manufacturers to comply with restrictions on activities at conferences, meetings and events where healthcare professionals are attending.

Also going into effect at the start of next month is an update of the Advanced Medical Technology Association code on interactions with healthcare professionals which, along with January's update of the Pharmaceutical Research and Manufacturers of America code, has corporate and industry association meeting planners reconfiguring their communication strategies, retraining employees and building technology to be compliant.

The new Massachusetts Department of Public Health regulations require pharmaceutical and medical device manufacturing companies to begin annually disclosing sales and marketing activities and payments to healthcare professionals who practice in Massachusetts.

Meanwhile, Vermont Gov. Jim Douglas this month signed into law legislation that is considered by some to be the most restrictive in the nation in banning gifts and requiring reporting of marketing expenditures for manufacturers of pharmaceutical products, biological products and medical devices.

The law also restricts meal expenditures and travel and entertainment spending by manufacturers on healthcare professionals.

On the federal front, the Physician Payments Sunshine Act, introduced in the U.S. Senate in January by Sens. Chuck Grassley (R-Iowa) and Herb Kohl (D-Wis.), could be wrapped into an overall national healthcare reform package and would require annual federal reporting of physician payments of more than $100. The first report would be due in March 2011, and that legislation would trump many current or pending state regulations.

In the near term, the Massachusetts code is considered the strictest state law regulating the sales and marketing activities of the pharmaceutical and medical device industries. Lesser levels of healthcare professional marketing regulation are in effect or have been proposed in states including Minnesota, New York, Rhode Island and West Virginia.

The various laws and proposals are aimed at reducing consumer healthcare costs, increasing access to physicians and eliminating practitioner biases to certain products.

The Massachusetts code applies to pharmaceutical and medical device manufacturers that have agents in or are located in Massachusetts, or market to state healthcare professionals. Aside from educational materials, most gifts are banned. Meals paid for by manufacturers outside of hospitals or other clinical settings also are banned. Unless services were rendered for a manufacturer, practitioners cannot be reimbursed for travel and entertainment.

Pharmaceutical and medical device companies also must separate their conferences, meetings and events funding from their sales and marketing departments and may not provide guidance regarding program content or faculty to a conference, meeting or event that they sponsor.

Perhaps the most daunting Massachusetts regulation affecting pharmaceutical and healthcare company meeting planners requires tracking and reporting financial interactions with "covered recipients." Starting in July 2010, companies must annually disclose any payments of at least $50 for sales and marketing activities involving healthcare professionals. The first reporting period covers July 1 through Dec. 31, 2009.

Multinational pharmaceutical company Novartis International this month is launching new data-capture technology and initiating training for about 200 employees involved with meetings and events to come into compliance with the new legislation and potential future state regulations.

The Basel, Switzerland-based company also has revamped its processes and consolidated its suppliers to more easily manage the reporting and compliance parameters.

Novartis has spent the last year customizing third-party compliance management technology to build validation and business rules engines so it can adapt to meal and travel expenditure caps and "help us advance to a different level as opposed to using people to do all that level of information," said Novartis director of meeting solutions Alice Woychik.

The four-hour classroom training session is part of a 25-week senior-management-endorsed communications initiative across several departments that covers the new regulations and reporting model.

"When the message comes from senior management, it's very powerful and cascades down," Woychik said.

Novartis' meeting and event suppliers also went through a training process after the company's vendor consolidation.

"Given the complexity of what we face in the industry today, there is an investment made there in terms of training, education and getting them onto your technology," Woychik said.

"If you are going to invest, invest in a smaller universe that is more manageable in order to have quality relationships, service and data collection," she said. "There is more time and resources spent in doing that, but they'll be able to be an extension of our staff and operate compliant meetings and quality data at the same time by that investment."

Although not directly under the purview of pharmaceutical or medical device manufacturer codes of conduct or the state government regulations, industry associations also are finding themselves adapting.

At last month's American Association of Critical- Care Nurses National Teaching Institute & Critical Care Exposition, at least a half-dozen exhibitors restricted what they gave away at their booths based on the new PhRMA code, and more than 50 exhibitors did the same based on new Advamed restrictions, according to the association's corporate relations and exhibits director Randy Bauler.

Those exhibitors gave out educational materials or nothing, instead of branded key chains, pens, mugs or notepads.

In the show's newspaper, AACN informed attendees that some of the 400 exhibiting companies had voluntarily subscribed to the codes. "What I have to deal with is an uneven playing field, with some that do and some that don't," said Bauler, who joins the Healthcare Convention & Exhibitors Association board this month.

Planners are not the only ones being affected, as some meeting venues and convention and visitors bureaus in those states fear they could lose business because of the new complexities of holding meetings there.

"According to the legislature, the intention was to lower the cost of healthcare," said PhRMA senior assistant general counsel Marjorie Powell. "It is not clear to me how a system that requires companies to do massive retraining of all their people to keep track of everybody who talks to a pharmaceutical company person any place in the country is going to lower the cost of healthcare."

In testimony written to the Massachusetts Department of Public Health, Greater Boston Convention & Visitors Bureau president and CEO Patrick Moscaritolo said that if half of the 14 scheduled large citywide medical convention meetings in 2009 decided not to meet in Boston because of the new law, the tax loss would be more than $3 million.

Those meetings are expected to generate more than 240,000 room nights and $49.1 million in overall spending. "As important as these large conventions are to our visitor industry, they represent only the tip of the iceberg," Moscaritolo said. "Under the tip of the convention iceberg are thousands of medical and pharmaceutical meetings taking place in Boston and Cambridge every year, and there's a lot at stake if these meetings do not book Boston."

Moscaritolo said the original law has been clarified to allow meetings and events to take place outside of a clinical setting in convention centers, hotel facilities or special event venues, such as the Museum of Science and the John F. Kennedy Presidential Library and Museum.

AACN's Bauler said the various state regulations are something he will have to consider when selecting a meeting destination, but they wouldn't push him out of a city, especially with some sites selected 10 years out. He noted that the AACN's annual convention is scheduled to return to Boston in 2013 and 2018.

Originally published June 22, 2009