The latest PhRMA Code update took effect on January 1, 2022. Find out the latest updates and what they mean for your business.
What Prompted the PhRMA Code Update?
The newest updates to the PhRMA Code respond to Office of Inspector General’s (OIG) special fraud alert about HCP speaker programs. The alert warns that pharmaceutical and medical device company speaker programs may violate the Anti-Kickback Statute. As such, the PhRMA update seeks to clarify the uncertain ethical territory surrounding these speaker events.
What Are the New PhRMA Code Updates?
PhRMA’s latest updates involve factors to consider when engaging HCPs in speaker programs. There is a new ban on serving alcohol at speaker program events.
The update provides specific guidance regarding appropriate purposes, invitations, meals, and venues for HCP speaker events.
- Purpose: The update reiterates the importance of HCP speaker events in filling an educational need. Because speaker events are essential and unavoidable, performing them ethically is of the utmost importance.
- Invitations and Attendance: Invitations to HCP speaker events must be limited to those with a “bona fide” educational need. Repeat attendance is generally not acceptable, particularly in instances where meals are provided but the event content is mostly the same. Exceptions can be made if the attendee can exhibit a bona fide educational need for the information being presented. Lastly, PhRMA reiterates that it is inappropriate for attendees to invite spouses or other unrelated individuals to speaker events.
- Business Meals and Alcohol Ban: Business meals must be modest according to local standards. Additionally, companies may now not purchase alcohol to be served at speaker events.
- Venues: Venues must also be modest in nature. Expensive restaurants and similar venues are not appropriate locations for speaker programs.
What Does This Mean for Me?
- Evaluate speaker program policies, SOPs, and guidelines. When were they last updated? What needs to change with this latest guidance? How will the alcohol ban be put into place?
- Review speaker program internal auditing and monitor results. Are speaker program guidelines being followed? Are there any risk areas that need further investigation and support?
- Consider enhanced speaker program communication and training. Are employees aware of the latest PhRMA Code updates? How are they being directed to address questions or challenging situations with HCPs?
Evaluate and Revamp
Healthcare companies can use the new PhRMA update as an opportunity to evaluate and revamp compliance training, particularly regarding speaker programs. Innovative ways of connecting with sales and marketing staff, such as animated videos, microlearning, interactive infographics can make a defining impact in decreasing the risk speaker programs may present.
Want to learn more about PhRMA Code?
The Pharmaceutical Research and Manufacturers of America (PhRMA) Code is a code of ethics that governs pharmaceutical company interactions with healthcare professionals (HCPs). First enacted in 2002, the code guides against violations of the federal Anti-Kickback Statute, a law banning the exchange of goods for healthcare business referrals. In short, PhRMA emphasizes that pharmaceutical prescriptions and referrals must be based purely on patient need and physician expertise. There are several interactions with HCPs that PhRMA considers inappropriate:
- Providing HCPs with entertainment or recreational activities
- Offering HCPs educational gifts of substantial value (over $100)
- Consulting with HCPs without a legitimate, documented need
- Paying HCPs more than fair market value for consulting services
- Incentivizing physicians to prescribe or refer a pharmaceutical product in any way (e.g., gifts, consulting, grants)
Any violations may interfere with “the independence of a health care professional’s prescribing practices.”
PhRMA Code Training
While compliance with the PhRMA Code is not required, it is considered an industry standard and best practice. Pharmaceutical companies should implement periodic PhRMA Code or company compliance training to ensure all employees and third-parties are aware of applicable guidelines and how they impact their day-to-day work.