Life Science Compliance Update

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January 08, 2013

Physician Payment Sunshine Act: Companies Collecting Data while Others are Whining

While the final regulations to implement the Physician Payment Sunshine Act are expected soon, aggregate spend companies are gearing up their products to offer to pharmaceutical and medical device manufacturers to help implement this significant regulatory burden.   

In the past few years, transparency of payments between manufacturers and physicians has continued to fill headlines and has even created projects such as ProPublica’s Dollars for Docs campaign—a project that aggregated all of the publicly available payments companies were posting voluntarily or as the result of a corporate integrity agreement (CIA) with HHS-OIG.  Interestingly, however, while Dollars for Docs included data from 2010, it was not updated in 2011. 

As a result, a new application—PharmaShine—filled the gap—continuing its “role as a single online source for up-to-date data on publicly available Pharmaceutical and Medical Device company payments to healthcare professionals.”   

PharmaShine, launched in August 2009 by Obsidian Healthcare Disclosure Services, LLC, is an internet-based system for the collection, disclosure, and management of pharmaceutical and medical device industry payments to healthcare professionals.  Obsidian was Co-Founded by a former in-house attorney at a major pharmaceutical company and a finance professional. 

PharmaShine has been nationally-recognized as the most comprehensive online database of industry payments to healthcare providers in the United States.  PharmaShine currently displays publicly disclosed payment data for over 500,000 physicians, physician assistants, nurse practitioners and other healthcare professionals across the United States.  According to the company, “Between August of 2009 and June 2011 the number of healthcare professionals for whom data has been publicly disclosed increased over thirty-fold.  In a recent blog post from PharmaShine, the company highlighted several aspects of its payment search database:   

  • PharmaShine reached over 2 million individual transactions tracked since launch.
  • PharmaShine was asked by the Centers for Medicare & Medicaid Services (CMS) to demonstrate its system capabilities in person as part of CMS' Sunshine Act market research efforts.
  • PharmaShine provided free email data reports to neurology patients in 45 states through our proprietary Consumer Search feature, accessible on PharmaShine 's Home Page.  

PharmaShine subscribers include top medical schools, multi-billion dollar healthcare systems, leading research centers, and pharmaceutical and medical device manufacturers.  PharmaShine’s institutional subscribers were able to use their services to “great effect, becoming informed about industry payments to their faculty and staff shortly after these payments were disclosed, allowing them to easily monitor adherence to institutional polices and to assist their physicians to correct erroneous payment data reported by industry.” 

In 2013, PharmaShine expects that a significant increase in the number of publicly disclosed payments combined with the expected release of the Sunshine Act rules early next year will likely generate a heightened awareness around these payments.   

Managing this data online currently presents significant challenges to any interested parties.  The volume and organization of payment data renders it difficult to collect and analyze.  Additionally, data on industry payments to physicians as it is now publicly available does not provide sufficient context with which to understand and utilize such data.  The result is that even when publicly disclosed, this data does not affect a better understanding of drug and device makers' relationships with health care providers.  

As PharmaShine’s database grows, it becomes better able to recognize duplicate and erroneous source data.  By applying similar techniques to those used by applications that filter email spam and merge and de-dupe direct mail address lists, PharmaShine has built an error-detection system into its import process that minimizes the likelihood of payments being mis-associated or lost. The result is a large, high-quality set of valuable data that is both optimized for real-time analytics and traceable back to the original source data.  The premise behind PharmaShine is simple:  

  • the volume and organization of data on industry payments to physicians as currently disclosed makes this information increasingly difficult to manage as data is released in greater numbers by more companies and state agencies;
  • sophisticated healthcare organizations need a reliable and accessible resource to organize this data as part of a comprehensive approach to compliance and to manage reputational risk;
  • the cost to build a manageable and reliable online database of this information would run into the $100,000’s in personnel and development costs for a large hospital or academic medical centers; and
  • by using a common internet platform, the economy of scale achieved dramatically lowers the cost of managing this data for each organization and the healthcare system as a whole, creating savings that can be passed on the American healthcare consumer 

PharmaShine has payments from most of the major pharmaceutical and medical device manufacturers.  In addition, they recently reported that the following data on payments for several companies is now searchable on its database.  This data includes payments by: 

  • GlaxoSmithKline for 1Q – 3Q 2012
  • EMD Serono for 1Q – 3Q 2012
  • Pfizer, Inc.  for 1Q - 3Q  2012
  • Novartis Pharmaceuticals Corporation  for 4Q 2011- 3Q 2012
  • Merck & Co. Inc.  for 1Q - 3Q 2012
  • AstraZeneca plc  for 1Q - 3Q 2012
  • Janssen Pharmaceuticals, Inc.  for 1Q - 3Q 2012
  • Medtronic, Inc. for 1Q - 3Q  2012
  • Allergan, Inc. for 1Q - 3Q  2012    

Where are the Sunshine Rules? 

While companies and health law attorneys are gearing up for the final regulations from CMS, physician stakeholders and professional groups have continued expressing their concern about the delays.  Specifically, the American Medical Student Association (AMSA) and the National Physicians Alliance (NPA)—both anti-industry groups -- urged the Obama Administration to issue the final regulations for the Sunshine Act in a letter to White House Chief of Staff Jack Lew.   

Both groups likely want the regulations so they can continue their careers and crusades stigmatizing physician-industry relationships and collaborations.  AMSA publishes its PharmFree ScoreCard, which grades medical schools based on whether they have strict policies to regulate interactions with industry.  The NPA is sponsoring  Accredited CME grand rounds “Selling Drugs: Pharma's Evolving Strategies.”  

Also, both groups know full well that the PPSA is in review at the White House and by law scheduled to be released before the end of January.   So it is unclear where the news is here or perhaps this is simple grandstanding.  As they will claim a victory for something that was going to happen whether or not they sent the letter.  

“The NPA and AMSA have supported the PPSA since its passage and are deeply discouraged that HHS [the Department of Health and Human Services] has not yet released final regulations, even though the statute called for regulations to be issued by Oct. 1, 2011,” the letter continued. “We are now 15 months past the statutory deadline,” reported MedPage Today. 

“As physicians and medical students, we understand that payments from industry can set the stage for significant conflicts of interest that can lead to the prescription of costly treatment, even when equally effective, safe, and less expensive treatments are readily available,” wrote NPA Executive Director Jean Silver-Isenstadt, MD, PhD, and Reshma Ramachandran, PharmFree Fellow at AMSA. 

“Such conflicts pose a grave threat to the intent of the Affordable Care Act (ACA), which is to deliver quality and affordable care to all Americans. Transparency about industry payments is an important step toward restoring trust and integrity in medicine,” the letter continued. 

“There is no call for further delay,” the groups concluded.  “We request that final regulations be released no later than January of this year, so that manufacturers can quickly implement procedures to begin collecting payment information.”

Previously, medical device manufacturer Medtronic and Pew Charitable Trusts urged the Obama Administration to quickly adopt the final Sunshine regulations before January 1, 2013—a deadline long passed.  Both organizations expressed their concerns that delays in the final rules “spawn concern about unnecessary costs,” and “confusion,” reported Reuters

“Many companies have already invested significant resources in preparing to comply with the sunshine provision,” representatives from Medtronic Inc and the Pew Charitable Trusts said in a November 16 letter to Marilyn Tavenner, acting administrator of CMS.  Pew released the letter on Wednesday, a day after the White House Office of Management and Budget began reviewing the final version of the regulation.  A preliminary version was published December 19, 2011. OMB is the final stop in the federal rule-making process before regulations are finalized.  

“Full implementation of this law will protect patients and help restore trust in our healthcare system,” said the letter co-authored by Medtronic's ethics chief, Thomas Schumacher, and Pew’s medical programs director, Allan Coukell.  

The healthcare law required the administration to establish reporting procedures for manufacturers by October 1, 2011.  The original deadlines also called for companies to begin collecting payment information on January 1, 2012, and submit the data to HHS by March 31, 2013.  “Delays in establishing procedures for the submission and public reporting of the required information have made these deadlines unfeasible,” the letter noted.

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