Life Science Compliance Update

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December 02, 2013

Physician Payment Sunshine: Vermont AG releases "Prescribed Product Disclosures" Report – Shows Decreases in Pharmaceutical Non Research Expenditures in 2012

Vermont's Prescribed Product Gift Ban and Disclosure Law (Law) prohibits manufacturers of prescription drug, device, and biologic products from providing most payments to physicians and other health care providers. Furthermore, the Law requires manufacturers to annually disclose to the Vermont Attorney General's office the value, nature, purpose, and recipient of any allowable expenditure or permitted gift by April 1 of each year (see Vermont's Expenditure Disclosure Form). Manufacturers must also annually disclose the product, recipient, number of units, dosage, and other information for all samples given to health care providers (see Vermont's Samples Disclosure Form).

In accordance with the Law, Vermont Attorney General William H. Sorrell recently released the eleventh report of Prescribed Product Disclosures (Report), based upon manufacturers' disclosures of payments made to health care professionals during the period of January 1, 2012 through December 31, 2012. The October 2013 Report reflects amendments made to the Law in 2009 and 2011, including the 2009 requirement that manufacturers disclose information regarding the distribution of samples of prescribed products to health care providers, and the 2011 change requiring manufacturers to report information about the distribution of over-the-counter products.

Results:

187 manufacturers reported spending approximately $7.6 million and distributing nearly 73,000 samples to Vermont health care providers, institutions, and organizations. The report notes: "Only 18 manufacturers had expenditures greater than $100,000 and 132 manufacturers had either expenditures of less than $20,000 or no expenditures at all. Only 7 manufacturers distributed 3,000 or more samples, and 105 manufacturers disclosed no sample activity at all."

Expenditures on pharmaceutical products accounted for more than $5.3 million of the $7.6 million expenditure total, and were made by 75 manufacturers, out of the 187 reporters. Thus, 40% of the manufacturers accounted for more than 70% of the expenditures.

The report notes that excluding payments made on clinical trials and research, expenditures which were not reported until 2010, puts 2012 expenditures at approximately $1.2 million, "the lowest level of pharmaceutical marketing expenditures reported in FY04 through 2012."

(Switched from Fiscal Year to Calendar Year in mid-2011)

Pharmaceuticals made up the majority of the percentage of total dollars reported (62% as compared with 18% for medical devices and 14% for biological products), as well as the percent of total samples distributed (87% as compared with 11% for medical devices and 0.1% for biologic products). However, the Report states that "for the third reporting period in a row, more than half of the total number of expenditures were associated with medical devices":

Expenditures and Samples by Product Type in 2012:

The number of manufacturers reporting pharmaceutical expenditures for 2012 (75) dropped from 77 reporters in 2011. The total number of expenditures also dropped to 5,059 in 2012 from 6,179 in 2011. The Report notes that roughly 93% of all the 2012 reports were for samples, in line with 2011's total.

The Report also broke down the manufacturers with the highest expenditures and the highest sample distribution during 2012. The chart reveals how large a portion of total expenditures the top five manufacturers constitute. Pfizer and Eli Lilly appear on both:

Top Five Manufacturers with the Highest Expenditures (2007-2013):

Top Five Manufacturers with the Most Samples (2011-2012):

In addition to manufacturer data, the Report broke down recipient data, including expenditures and samples by recipient type as well as expenditures by specialty. Approximately 66% of the dollar value of expenditures made in 2012, or $5 million, went to clinical trials and research as noted above. Approximately 77% of samples distributed went to doctors. The greatest amount of expenditures to health care providers receiving at least $3,000 in 2012 went to doctors specializing in cardiovascular disease.

Finally, the Report detailed the top products by expenditure dollar totals, including clinical trials. The top ten products by expenditure dollars for 2012 were all pharmaceuticals, and accounted for $4.1 million, or approximately 54% of overall spending. Contrast this with 2011, when the top ten accounted for $5.2 million dollars, but accounted for 37% of overall spending.

Top Ten Products by Expenditure Dollar Totals in 2012 (including clinical trials):

The top ten products by sample totals for 2012 accounted for 28,000 samples, or 39% of the overall samples distributed in 2012. Contrast this with 26,000 samples constituting only 20% of the overall samples distributed in 2011.

Top Ten Products by Sample Totals in 2012:

Attorney General Sorrell concluded his report with the enforcement statistics under the Prescribed Product Disclosure Law in 2012. As Policy & Medicine reported last month, Vermont fined 25 manufacturers for violations of the Law last year. All violations were self-reported by manufacturers, and each agreed to future compliance with the Law. Twenty-four manufacturers, having failed to file disclosures entirely, paid a total of $25,250 to the State in fees. In addition, one manufacturer paid $36,000 in civil penalties to settle a total of six gift-ban violations. Each violation consisted of providing a meal to a health care provider. 

Update for 2013 Disclosure and 2014 Guide

Companies are required to fill out the registration form for 2013 reporting by December 31, 2013 and pay a fee of $500.00. Vermont requires disclosure of expenditures and samples for reporting period 1/1/2013-12/31/2013 to be submitted to their office by April 1, 2014

The 2013 Compliance Officer, Expenditure Disclosure and Samples Disclosure Forms have been posted to the Vermont Attorney General's website.   Vermont Attorney General expects to post the 2013 databases during the first week after the Thanksgiving Holidays. 

The Draft 2014 Guide will soon be posted on the Vermont Attorney General's website. 

Vermont AG will have a conference call to get feedback on the Draft 2014 Guide on:

                                Thursday, December 19, 2013

                                1:30-2:30 p.m., Eastern Standard Time

Link to Documents

    2012 Report: Disclosure of Expenditures and Samples

Expenditures Disclosure Form for 2013

Samples Disclosure Form for 2013

Click here to log in and submit samples and/or expenditures and/or to obtain a downloadable samples and/or expenditures database for later submission(s). The login credentials are obtained by filing the Compliance Officer Form as listed above.

Guidance: Guide to Vermont's Prescribed Product Gift Ban and Disclosure Law for 2013 Disclosures - 12/20/2012

 

Table of Entity-Recipients for 2013 Reporting Period

 

Table of Health Care Professionals with Active Vermont Licenses

 

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