PhRMA code revisions are meant to bolster declining public perception of drug companies

Key Points

In a recent survey, 44% of respondents held an unfavorable view of pharmaceutical companies. This joint survey, titled "The Public on Prescription Drugs and Pharmaceutical Companies," was conducted by the Kaiser Family Foundation, USA Today, and the Harvard School of Public Health. The 44% "unfavorable view" of pharma ranked behind only health-care companies (54%) and oil companies (63%).

It would be tempting to say that these consumer sentiments are due only to rising costs in a declining economy. But as an industry, we would do better to face the reality: because of the consumer perception that pharmaceutical companies overcharge patients (even President Obama wants to lower costs as evidenced from his inaugural address asking for lower health-care costs and better technologies) and then use much of their profits to overinfluence physicians, the pharmaceutical industry is developing a credibility gap in the minds of many.

As a proactive effort to bolster these declining consumer perceptions of the pharmaceutical industry, the Pharmaceutical Research and Manufacturers of America (PhRMA) recently published updates to its "Code on Interactions with Health-care Professionals," which went into effect Jan. 1.

Made up of representatives from both large and small pharmaceutical companies, "PhRMA's mission is to conduct effective advocacy for public policies that encourage discovery of important new medicines for patients by pharmaceutical/biotechnology research companies."²

The overall goal of the PhRMA code is to ensure that all interactions between pharmaceutical representatives and medical professionals are ethical and based on the premise of educating the medical professional about the unique attributes and benefits of a product as related to the indicated disease target. In short, this revised code is a guidance document setting forth an ethical code for pharmaceutical companies that are interacting with physicians and other health-care professionals.

What the code means

The immediate visible change that many health-care professionals will notice is the prohibition of gifting: providing restaurant meals or entertainment or recreational benefits and distributing non-educational items such as pens, mugs, and other similar branded items.

The exceptions to these changes is allowing the distribution of items, with a cost under $100, that are beneficial to the patient either through education of the health-care professional or an item that aids the health-care professional in educating the patient, but they only should be distributed on an occasional basis.

The code also allows for in-office meals to be provided by the pharmaceutical representative in conjunction with an educational learning session.

The reasoning behind this prohibition is that even gifts and out-of-office meals that are minimal in value "may foster misperceptions that company interactions with health-care professionals are not based on informing them about medical and scientific issues."¹ This particular portion of the code may seem trivial, but it demonstrates the commitment that PhRMA has made toward implementing its mission at every single level of the pharma-physician relationship.

Among the other major items is one in regard to cash payments in return for speaking or consulting services. For continuing medical education (CME) and third-party educational or professional meetings, PhRMA recommends that all payments be made directly to the sponsor or CME coordinator to reduce the registration fee for all attendees of the event.

It also is recommended that additional costs for speakers (travel, food, entertainment) not be covered by the sponsoring pharmaceutical company, nor should gifts, food, or entertainment be provided at the event. This recommendation is designed to keep the relationship between the physicians and pharmaceutical representatives at an educational level "since the giving of any subsidy directly to a health-care professional by a company may be viewed as an inappropriate cash gift."¹

Converse to the aforementioned restrictions on public events, the code clearly states that consulting agreements between a health-care professional and a pharmaceutical company are okay provided that compensation is of "fair market value." This same standpoint is taken regarding speaker programs and speaker training programs, because the amount of time put into the training and actual presentations is considerable and provides a necessary element in the educational training of other health-care professionals.

Those sections of the code extensively define how the relationship should be treated and what services are appropriate for compensation or reimbursement for a health-care professional who is providing consulting or advisory services. The code also reaffirms the position of many professional organizations asking for full disclosure of financial relationships when presenting on behalf of a product or company.

A few sections of the code relate to the education of pharmaceutical company representatives about the code and how PhRMA recognizes companies that comply with the code.