In this episode of AHLA's monthly series on fraud and abuse issues, Matthew Wetzel, Partner, Goodwin Procter, speaks with Julie Wagner, Head of Global Ethics, Compliance & Enforcement Legal Policy, PhRMA, and Martina Rozumberkova, Principal, Control Risks, about changes made to the PhRMA (Pharmaceutical Research and Manufacturers of America) Code related to speaker programs, partly in response to 2020 guidance from HHS’ Office of Inspector General. They discuss PhRMA’s process for making the changes, what compliance officers need to know about the changes, and PhRMA’s role in the debate about the provision of meals. From AHLA's Fraud and Abuse Practice Group. Sponsored by BRG.
To learn more about AHLA and the educational resources available to the health law community, visit americanhealthlaw.org.
In this episode of AHLA's monthly series on fraud and abuse issues, Matthew Wetzel, Partner, Goodwin Procter, speaks with Julie Wagner, Head of Global Ethics, Compliance & Enforcement Legal Policy, PhRMA, and Martina Rozumberkova, Principal, Control Risks, about changes made to the PhRMA (Pharmaceutical Research and Manufacturers of America) Code related to speaker programs, partly in response to 2020 guidance from HHS’ Office of Inspector General. They discuss PhRMA’s process for making the changes, what compliance officers need to know about the changes, and PhRMA’s role in the debate about the provision of meals. From AHLA's Fraud and Abuse Practice Group. Sponsored by BRG.
To learn more about AHLA and the educational resources available to the health law community, visit americanhealthlaw.org.
The following message and support for ALA is provided by Berkeley research group, a global consulting firm that helps organizations advance in the areas of disputes and investigations, corporate finance, and strategy and operations BRG helps clients stay ahead of what's next for more information, visit think brg.com.
Speaker 2:Good morning. Good evening. And welcome to the American health law association fraud abuse podcast. I'm your host, Matt Wetzel. Many of our clients, whether life sciences companies or healthcare service providers turn to industry codes of ethics for guidance on best practices and standards for meeting compliance expectations of the government industry codes can serve a great opportunity to demonstrate a particular sector's self-regulation and they can often help smaller, less resourced organizations build the foundation for effective compliance programs. Today I'm joined by Julie Wagner, senior assist assistant general counsel and head of global ethics compliance and enforcement legal policy at pharma and Martina Rosenberg. Cova principle at control risk. So worldwide consulting company to talk specifically about changes made to the pharma code on interactions with healthcare professionals in 2021 pharma, the pharmaceutical research and manufacturers of America updated its longstanding code of ethics in response to in part 2020 guidance from the HHS office of inspector general on so-called speaker programs and other training efforts by the drug and device industries in its guidance issued as a special fraud alert. And November, 2020 OIG makes clear its concerns about these programs, which often involve drug and device manufacturer compensation to speakers and the provision of meals and other items of value to attend. These notably OIG identifies several attributes of speaker programs that it finds to be suspect and could potentially be indicative of violations of the anti kickback statute. My guests today are no strangers to these topics. Julie Martino, welcome to the podcast.
Speaker 3:Hi Matt. Thanks for having me. Thank you. Thank you, Matt.
Speaker 2:Absolutely. Well, this is a really exciting opportunity today, Julie, to hear from you about the recent pharma code changes, uh, in response to the speaker program guidance. I know it's a really interesting topic and exciting topic for pharmaceutical companies and also for other life sciences companies. Could you give us a quick overview of the code revisions themselves, and then, you know, maybe talk a little bit about the process that you followed to get there?
Speaker 3:Absolutely. I'm, I'm happy to. Um, so we began our code, uh, revision even before OIG issued their special fraud alert. We sort of considering whether there are areas of the pharma code that could be updated or modernized or, you know, were, um, in need in need of some refreshment. Um, and so we were already in process of, of doing that and the way pharma works is, um, we have working groups that are populated by, um, you know, staff from our member companies. Our members are various, um, pharmaceutical companies, uh, and, and we use those work groups, you know, this one consisted of, um, lawyers and also chief compliance officers, um, from, from those pharma companies, we use those groups as sort of expert advisors, um, and to counsel us on, you know, what is happening in the market, what is happening within their companies and, and how, you know, the voluntary code of ethics, um, impacts them and, and should be updated. And so that group was already convened when OIG came out with their special fraud alert and speaker programs. And so of course that was a major development, uh, in the enforcement world, um, and directly relevant to the pharma code because the pharma code already had an existing section on speaker programs. And so we sort of took the special fraud alert, um, and looked at each element and compared it with our existing provisions on speaker programs, um, you know, and tried to, to pull from OIGs guidance, um, principles that would be appropriate for, uh, a voluntary industry code of ethics. And so we've tried to pull those through, uh, into the code itself. So I'm happy to talk more about specifics. Um, you know, if, if you're interested in there specific questions about, about various, um, elements.
Speaker 2:No, absolutely. And, uh, you know, with my own experience, having, uh, worked ated for several years and overseeing some code visions there, I can understand the process that you've followed and, you know, sort of the need to, um, get input and feedback from the companies. And especially with respect to, um, such a groundbreaking new guidance document as the speaker programs, guidance, which specifically refers to the pharma code and the Avi med code Martina. I, I don't know if you have any questions for Julie, but let me turn it over to you and, and, uh, and, and get your take.
Speaker 4:Great. Uh, thank you, Matt and Julie, it's certainly great to be able to talk to you and to learn from you about this new updated code. Have you seen an uptick in questions from pharma members with the respect to the code provision
Speaker 3:We have, and I would say at the outset that once pharma publishes the code of ethics, mm-hmm,<affirmative>, we don't then offer sort of one off interpretations to companies who call us and ask questions. And there are a number of reasons for that one, um, is sort of fairness and predictability, right? Um, we don't wanna be providing, um, interpretations to one company that others in the industry don't have the opportunity to hear. So anything we, um, publish, we want to be, you know, public and available, available to everyone. Um, so, so we don't tend to, um, directly interpret the code for individual companies, but people do call, you know, with questions. And I would say, um, the most frequent question we get is around alcohol provision, um, with respect to speaker programs, um, and sort of along the lines of, um, how should we be policing alcohol, if at all, what is actually expected of us? You know, what if a doc walks in with a glass of wine already in their hand, are we required to like slap it outta their hand? What are, what are we supposed to be doing here? Um, and so, you know, as I said, we don't as pharma, um, issue further interpretive guidance on, on what that standard means, the standard and the updated code is of course the company should not pay for, or provide the alcohol. Um, that is a little different from the standard in OIGs guidance, of course, which is, you know, um, that there may be, uh, concerns raised where alcohol is available. And we had, we had long discussions within our work group about the OIG language, um, and about how that might actually work on the ground. You know, if even say, even if you're not in a restaurant, if you try to reserve, um, a hotel conference room, but there's a bar upstairs, you know, is that, does that constitute alcohol being available at your event? Mm-hmm<affirmative> um, and so we thought for purposes of a voluntary code of ethics adopting a standard that the company should not pay for or provide alcohol is something that's within the company's control is something they can monitor. It's something they can audit for. Um, and of course, companies will have to look at both standards and make, make an assessment, our code doesn't replace OIGs guidance, of course. So you sort of have to look at both, um, and take both into account. Um, but, um, you know, so, so we, we don't offer interpretations and each company will have to decide with their compliance officers and maybe their outside council and, um, you know, their internal folks, what exact operating, um, policies and procedures to put in place around, um, making sure that, uh, complies with the, with the standard.
Speaker 2:Yeah. And, you know, Julie, it's interesting because I think when, when we think about the speaker program guidance, there's been a lot of buzz around that alcohol concept as listed by OIG as sort of one of the suspect characteristics or suspect attributes, so to speak. Uh, you know, and I think that maybe, you know, in my own working with my own clients, there's been a little bit of an ex almost too extensive focus on that piece, although it is certainly an important part of the OIG guidance. I wonder from your perspective, if you've seen any sort of misperceptions or misunderstandings of either that guidance or the code revisions, um, that has impacted your work at pharma.
Speaker 3:Yeah. That's a great question. Um, I'm not sure about misperceptions, but I will say that, um, you know, as part of our work stream to update the pharma code, we went back and looked at enforcement actions involving speaker programs over the last 10 years. And when you do that, when you really get into the cases and look at the factual situations, and then you look at OIGs special fraud alert, you can see that the fraud alert is sort of an enumeration of all of the allegations from all of those cases over the last 10 years. And so, so when you look at it like that, and that, that of course is helpful, right? It's sort of, um, distilling for all of us, what's happened over the last 10 years in the enforcement environment and saying, these are some aspects of programs that OIG will find suspect that's helpful. Um, but maybe I, I think it's still important to keep in mind that, you know, the facts and circumstances of each individual program need to be looked at holistically, right. And any one factor is be balanced with other factors. Um, and so, you know, I do think that, um, I do think in general, what we found was, um, that these programs tend to be, um, educational in nature. They do tend to happen, um, by and large in venues that are conducive to educational exchange. You know, um, the, the meal does tend to be secondary to the educational information. So most programs are in the space where you would want them to be right mm-hmm<affirmative>. And these, these factors that are flagged by OIG are really, um, you know, sort of the outliers. So, um, you know, and I would just add, we talked two physicians too, um, as part of our, our project and they, uh, reinforced us how important these programs are for their own education, you know, learning about, um, the benefits and the risks of products, right. Because who knows those, that profile better than the manufacturer. Um, and that they, you know, in the current healthcare system are of course also crunched for time and, and for money. And so, um, those times outside of patient care, um, really the only time they're not directly caring for patients is meal times. Right. And so it makes sense that those educational programs would happen at meal time. And the meal is just a courtesy to allow the physician to fit it into his busy schedule, his or her busy schedule.
Speaker 2:Absolutely. I think that's, I think that's really well said. I know, you know, even with my own clients, uh, the focus, you know, should shift back from, you know, just looking specifically at that alcohol bullet to more broadly, what is that speaker program guidance talking about? And it's, you know, the, the legitimacy and, and, and bonafide nature of, you know, really good educational content. How do you think, um, Julie, that these coder visions will be helpful to compliance officers who are looking to build out, enhance their compliance programs, add additional controls, et cetera.
Speaker 3:We, we attempt to, um, create principles, um, that get to sort of the ethical core of what the, what the concern is. And we hope that those principles, um, are helpful guidelines, right. And guidance in the right direction, but are flexible enough for companies to, um, adapt to their own, their own particular, you know, circumstances around their own products or, or markets. Um, one example of that is, uh, in the OIG special fraud alert, they talked a lot about, um, you know, repeat attendance at certain, um, events about holding a large number of events. You know, when there wasn't necessarily new science, um, about spouses and guests attending and all of that to us, um, when you sort of distill it down to what is, what is the ethical principle, um, OIG is really concerned about here seem to us to be, um, there should be an educational need for the program, right? There should be a bonafide educational need for the provider to be there in that room, hearing the information. And so instead of adopting some of those granular, um, requirements from the special fraud alert, we instead adopted a principle around educational need that we thought reflected, um, you know, what OIG had included in the special fraud alert. So we, so we hoped that that's helpful in sort of giving a guiding principle to, um, compliance officers and compliance staff, or actually developing the policies.
Speaker 4:Mm-hmm,<affirmative> great. That's, um, that's very helpful. Is pharma closely connected to the broader debate globally on the provision of meals and virtual meals in particular?
Speaker 3:Yes, we are. So we put out our code update, um, last year, of course, effective January one of this year. And, um, our priority pharma's priorities for this year really are to engage in this, um, debate that's happening internationally around what should happen on wheels. Mm-hmm<affirmative>. So if P M a, um, of course is the international sort of association of local trade associations end of pharmaceutical companies, it's sort of our international counterpart, if you will. Mm-hmm<affirmative> mm-hmm<affirmative> um, and they've been engaged in, um, discussions as well about what international ethics standards to put in place around meals. And so, um, we, we have been engaged in those discussions, um, and informing sort of those discussions with our findings, from our work stream here. Um, and, and, and trying to ensure that, you know, we adopt hopefully consistent standards across, um, different markets and different countries recognizing that many, many companies operate across the globe. And so having consistent standards may be helpful.
Speaker 4:Mm-hmm<affirmative> and I have one more question. So the follow up question regarding the meals, and I can imagine that others may have the similar questions. Do you think pharma may revise the code again to prohibit the meals altogether?
Speaker 3:That's a great question. Um, we do not currently have a plan to reopen the code on the issue of meals. Um, we considered it extensively, uh, over, you know, a nearly two year process to come up with the, um, update that we most recently put out. And we think that that update reflects, um, appropriate ethical principles. Um, now that being said, we are always, um, sort of scanning the environment for changes, changes, you know, in the enforcement environment, other changes that could necessitate reopening the code. Um, but, but given that we just went through that process, we don't anticipate, um, doing that on the issue of meals again soon.
Speaker 4:Thank you.
Speaker 3:Mm-hmm<affirmative>
Speaker 2:You answered my next question, Julie, which was really sort of even more broadly if there's any plan to, um, contemplate further revisions to the code. And it sounds like the answer is, you know, if new topics come up, uh, but, uh, you know, right now, nothing planned in the, in the
Speaker 3:Pipeline. That's great. Um, you know, as we, as we've engaged in this sort of, um, more international conversation around the issue of meals, it's, it's also been very interesting to see, um, you know, those of us in sort of the enforcement and compliance space, um, base, um, see all of the, all of the areas where we're trying to improve compliance, or we're trying to improve, you know, um, the strength of ethics within the industry. Um, but when you look internationally, the United States, um, actually has very strong, um, you know, sort of standards with respect to individual company compliance programs, the strength of those programs, the effectiveness of those programs, the breadth of them, um, you know, the, the, um, framework put in place by OIG and enforcement and all of those things. Um, so, and compared to, you know, developing countries, um, or even just sort of less, um, less developed countries than the United States, that is not the case, you know, they're still working to sort of come up to the us standards. So, so we've been working hard to engage in those processes to sort of help bring up global ethics standards across the globe, even to where, um, the United States is. And so, um, we've been focused on that. Um, we, we will, as I said, of course, always monitor to see if our code needs to be updated in some way, and we will do that. Um, we do wait for there to be sort of a compelling reason to update the code. We don't do it just, um, for the sake of updating, given that it, it is, you know, it does send ripples through the industry and creates work on, um, behalf of compliance officers and their staff. And so we, we recognize that and we try not to do it sort of frivolously, but wait for there to be a real reason to do it.
Speaker 4:We were wondering if you could perhaps give us some explanation out around the staff participation in meals. And I believe there is a, there is a sentence here. Let me see if I can actually see it. It's really says incident. The meals can be provided when there is a reasonable expectation and reasonable step are taken to confirm that each a attendee has a substantive interaction or special with company represented. So is this essentially just a restatement of the guidance, no. Grab and go for, for the, you know, a step, right? Or is this something you mean something little different or something that we should take from it in addition to know, grab and go.
Speaker 3:That's an excellent question, Martina. Um, it is a restatement of grab and go, but it is something more than that too. So it gets to the issue of virtual meals, which you had raised, um, a little bit earlier Martina, um, as you might recall, um, or maybe not, if you're not all that plugged into, you know, pharma code happening, but, um, at the very beginning of the pandemic, pharma issued a special statement about virtual detailing interaction. Mm-hmm,<affirmative> so interactions between sales reps, um, and physicians who are now working virtually, right. And we, we laid out sort of, um, parameters those virtual interactions during the emergency period. And so when we were updating the code itself, when we moved on to sort of this more permanent update to the code, we had to carefully consider, you know, are we gonna address virtual interactions versus in-person interactions are gonna be different standards, right? And so we began to go down that path of setting forth, um, separate standards for virtual interactions and what would be required in terms of, you know, it quickly got very granular around, like does the video have to be on? And what, what really constitutes having that substantive interaction, such that a meal would delivery of a meal, be appropriate in a virtual interaction. And so, um, when we find ourselves in those situations where we're getting very granular with very rules based standards, um, we often try to pull back and say, what, what are we really getting at here, right. What is the ethical principle behind these standards? And the principle really was, um, you know, if you're delivering a meal to a physician or a staff, you should be having a real interaction with them, right? Like it shouldn't be just delivery of a meal. You should be having a real substantive interaction. And so that standard, the substantive interaction standard came out of that discussion. Um, and really it is just to say, instead of delineating in person versus virtual interactions, the standard is that you should be having a virtual us, a substantive interaction with that person. We haven't, um, put out any additional sort of interpretive guidance of that. You know, our sense is that it could, that interaction could be different depending on the type of person you're talking to. Right. If you're talking to the physician, that might be a very, um, scientific exchange, right. If you're talking to, um, someone in the front office maybe is talking about the company's free drug program or something else, you know, mm-hmm<affirmative> um, so we tried to leave flexibility in that standard so that, um, different companies and different, um, you know, disease, state areas and different geographic areas could adopt the standards that make sense. Mm-hmm<affirmative> for them.
Speaker 4:Are there any affirmative step that, uh, pharma would expect us to, you know, a company to take in response to this really slightly changed standard? Are there any expectations that we should start implementing into the award?
Speaker 3:There are no express expectations from pharma, right? There's no further interpretive guidance from pharma on what that means. So, um, the expectation is only that the company will adopt some policy and procedure to address the company's expectation is for a substantive interaction. Um, and then, you know, of course, you know, audit and monitor that and all the other things that happen in normal.
Speaker 4:Yeah. Just normal. Yeah. Okay. You know, address it. Okay.
Speaker 2:And then that makes sense from a, um, government expectation standpoint as well, whereby compliance programs should be tailored to the business at hand to the various risk factors that are specific to that business, whether that's as you note, you know, geography or company size, or, you know, particular sectors that might have a different risk profile than others. Mm-hmm,<affirmative>, uh, that, that, that, that seems to be in line with, with, with those expectations. Well, we really appreciate the time, Julie, thank you so much for joining us and sharing your insights on the code and the code development process. It's not always the easiest, uh, but at the end of the day, when there's a good, uh, uh, guidance document, that's out there from the industry, it's always important to understand the ins and outs. So thanks so much for the time. And thanks so much to our listeners for tuning in to this addition of the American health law association for abuse podcast. I'm your host, Matt Wetzel, and we'll be back next month with another ion. Thanks so much.
Speaker 5:Thank you for listening. If you enjoyed this episode, be sure to subscribe to ALA speaking of health law, wherever you get your podcasts to learn more about ALA and the educational resources available to the health law community, visit American health law.org.