the new urgency for compliance: recent legal developments and their implications for conferences and...
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The New Urgency for Compliance: Recent Legal Developments and their Implications for Conferences and Exhibitions
AIPC, July 1, 2013, Cape TownTanya Vogt, SAMED
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Agenda
I. About the MedTech industry
II. Broader perspective & environment
III. What does it mean for congress centres / organisers?
IV. Conclusion
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I. About the MedTech industry
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MedTech: a diverse sector
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II. Broader perspective and environment
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Global issues of the MedTech industry
Regulatory• Clinical• Environmental• Market access
Financial• Pricing• Reimbursement• Procurement• HTA
Compliance• Codes of Ethics• Transparency• Third-parties
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Ethically responsible companies
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HCPs & companies are under the limelight
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Increasing enforcement
Enforcement of OECD Anti-Bribery Convention*:
199 individuals and 91 entities have been sanctioned under criminal proceedings for
foreign bribery in 13 countries (between 1999** and the end of 2010).
At least 54 of the sanctioned individuals were sentenced to prison for foreign bribery.
A record amount of EUR 1.24 billion was imposed in combined fines on a single
company for foreign bribery.
Approximately 260 investigations are ongoing in 15 countries. Criminal charges have
been laid against over 120 individuals and 20 entities in 5 countries.
Active enforcement in particular in Denmark, Germany, Italy, Norway, Switzerland, United
Kingdom, United States**
* Data collected as of March 2011; http://www.oecd.org/document/3/0,3746,en_2649_34859_45452483_1_1_1_1,00.html
** When Convention entered into force
***TI Progress Report on Enforcement of the OECD Convention: http://transparency.org/news_room/latest_news/press_releases/2011/2011_05_24_oecd_progress_report
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Public disclosure of individual relationships
Different disclosure requirements:
Recent trend in Europe (legal & self-regulatory): e.g. France, Czech
Republic, Slovakia etc.
Types: publication of payments to HCPs by companies; publication
of contracts between the industry and HCPs; publication of details of
donations made to institutions, etc.
Potential challenges:
How to deal with administrative burden (e.g. very low threshold)?
How to build up an internal tracking/reporting systems?
How to explain to HCPs that their finances will be public?
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Enforcement – FCPA HC industry cases
2013 […] Koninklijke Philips Electronics - SEC charged the Netherlands-based company with FCPA violations related to improper payments made by employees
at its Polish subsidiary to healthcare officials in Poland. Philips agreed to pay more than $4.5 million to settle the charges.
2012 Eli Lilly and Company - SEC charged the Indianapolis-based company for improper payments its subsidiaries made to foreign government officials to win
business in Russia, Brazil, China, and Poland. Lilly agreed to pay more than $29 million to settle the charges. […] Tyco International - SEC charged the Swiss-based manufacturer with violating the FCPA when subsidiaries arranged illicit payments to foreign officials in
more than a dozen countries. Tyco agreed to pay$ 26 million to settle the SEC's charges and resolve a criminal matter with the Justice Department. […] Pfizer - SEC charged the company for illegal payments made by its subsidiaries to foreign officials in Bulgaria, China, Croatia, Czech Republic, Italy,
Kazakhstan, Russia, and Serbia to obtain regulatory approvals, sales, and increased prescriptions for its products. […] agreed to pay a combined $45 million in settlements.
Orthofix International - SEC charged the Texas-based medical device company with violating the FCPA when a subsidiary paid routine bribes referred to as “chocolates” to Mexican officials in order to obtain lucrative sales contracts with government hospitals.
[…] Biomet - SEC charged the Warsaw, Ind.-based company with violating the FCPA when its subsidiaries and agents bribed public doctors in Argentina,
Brazil, and China for nearly a decade to win business. […] Smith & Nephew - SEC charged the UK-based company with violating the FCPA when its U.S. and German subsidiaries bribed public doctors in Greece
for more than a decade to win business. The company and its U.S. subsidiary agreed to pay more than $22 million to settle civil and criminal cases.
2011 […] x2 Siemens executives - SEC charged seven former Siemens executives for their involvement in the company's decade-long bribery scheme to retain a $1
billion government contract to produce national identity cards for Argentine citizens. […] x5 Johnson & Johnson – SEC charged the New Brunswick, N.J.-based company for bribing public doctors in several European countries to win contracts
for their products and paying kickbacks to Iraq to illegally obtain business. J&J agreed to pay $70 million to settle cases brought by the SEC and criminal authorities.
[…] x 6
In http://www.sec.gov/spotlight/fcpa/fcpa-cases.shtml
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Specific challenges
General framework – Cross-sectoral:
Þ Anti-corruption regulation (e.g. FCPA, OECD, UK bribery Act, …)
Healthcare companies (MedTech, pharma)
Þ Public money – Governmentally controlled social security
Þ Complexity of the stakeholders interactions
Þ Physicians are to the industry :
o Customers (in their prescribing role) and users
o Service providers (as Speakers, Experts, Trainer, Researchers...)
o Decision-makers (as Pricing Committee Members, Expert etc.)
Þ Who else is a customer ?
o Wholesalers, Distributors, Pharmacists, Retail Chains, Hospitals, Clinics ....
o The Sick Funds, the Managed Care Organizations
o The Ministry of health (through Public Hospitals etc..)
o The patient as co-payer and as the one who receives the treatment
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What are companies willing to risk?
Do the maths!Þ Development of healthcare compliance programs in the companies
Þ One big risk for healthcare companies is the relationship
with healthcare professionals (R&D and training/education)
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III. What does it mean for congress centres / organisers?
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Industry’s support to medical education
Educational grants to a hospital or scientific society
Grants to congress organisers
Individual support of physicians to congresses by companies
Needed or/and
Suspicious?
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Support of HCPs to congresses
Recent developments popping up all around the world, but slightly different
from country to country:
More and more countries prohibit or limit company support to individual
HCPs to congresses (e.g. USA, Australia, Korea, Norway, Netherlands,
Sweden)
Transparency – reporting of payments and transfers of value from the
companies to HCPs in public databases (e.g. France, USA, Slovakia)
Industry codes of ethics (e.g. Eucomed, EFPIA, IFPMA, MCA) – Review
of the “appropriateness” & “image projected to the public” of congresses
− Eucomed Conference Vetting System (CVS) – binding decisions for members
− EFPIA’s code of ethics
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IV. Conclusion
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Potential consequences
Fewer participants
HCPs to pay from their own pocket
Selection of most “valuable” congresses [from an educational
perspective for HCPs]
Less industry funding – exceptionally no industry funding if “non-compliant”
Þ More competition between congresses and congress centers
Þ Value of staying connected and monitor developments
Caveat: Global development & specificity of the healthcare sector.
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Eucomed Conference Vetting System
The Eucomed Conference Vetting System is reviewing compliance of third
party educational conferences with the ethical rules established by the
Eucomed Code
Managed by the independent Compliance Officer
Binding decisions on the Eucomed members
No sponsorship of HCPs at inappropriate conferences
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The Assessment Criteria
Conference programme:
Detailed schedule
Available in advance
Relevant to HCPs
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The Assessment Criteria
Geographic location & Conference venue
Location
Seasonal resorts, golf resorts, cruise
ships and spas not allowed
Time of the year
Easy to access/central location
Local HCP exception
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The Assessment Criteria
Hospitality and accommodation
Not excessive or could be
considered « entertainment »
Reasonableness of hospitality
Separate additional charge
included for spouses, partners,
family & guests
Duration
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The Assessment Criteria
Entertainment
Not allowed, except for modest and incidental gatherings such as an
opening cocktail and /or conference dinner which must be open to all
HCP delegates
Does not dominate or interfere with scientific aspect of the programme.
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The Assessment Criteria
Communication / registration support
Inappropriate design of the
advertising support
Unauthorized activities advertised
Combined registration fee which
includes spouses, guests,
partners, family
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What conferences?
European conferences
Participants from more than one European country
Europe:
EEA countries
Switzerland
Associate members’ countries
International conferences taking place in Europe.
N.B: The Compliance Panel may, exceptionally and at its discretion, extend the scope
to national and/or international conferences.
EU 27 + Iceland, Liechtenstein & Norway
Russia, Turkey and the Middle East
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What is the process?
Submission Assessment Ruling
Completed online form Submitted at the latest 90
days prior to the event Early submissions are
highly encouraged
Handled on first-come, first-served basis
Assessed within 30 days of submission
Organiser stakeholders to be notified at the latest 10 days prior to the publication of a negative decision
Published in the event database
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Conclusion
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Thank you. Questions?
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