Life Science Compliance Update

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June 26, 2015

Massachusetts Governor Orders Review of All State Regulations; Opportunity For Healthcare Industry Comment

Mass government

Earlier this year, the Governor of Massachusetts, Charles Baker, signed an executive order initiating a “comprehensive review’ for all regulations enforced by the Executive Department. Only those regulations which are mandated by law or essential to the health, safety, environment, or welfare of the Commonwealth’s residents will be retained or modified, the order states. The measure is aimed at reducing “burdensome regulations to increase efficiency and competitiveness.”

To meet the standard set forth in the order, agencies must show:

  1. There is a clearly identified need for governmental intervention that is best addressed by the Agency and not another Agency or governmental body;
  2. The costs of the regulation do not exceed the benefits that would result from the regulation;
  3. The regulation does not exceed federal requirements or duplicate local requirements;
  4. Less restrictive and intrusive alternatives have been considered and found less desirable based on a sound evaluation of the alternatives;
  5. The regulation does not unduly and adversely affect Massachusetts citizens and customers of the Commonwealth, or the competitive environment in Massachusetts;
  6. The Agency has established a process and a schedule for measuring the effectiveness of the regulation; and
  7. The regulation is time-limited or provides for regular review.

Perhaps most notably is the prong that the regulation not “exceed federal requirements."  This is an important announcement for life sciences companies—Massachusetts has long been one of the more complicated and challenging states to do business in based on several regulatory requirements that require time and resources above and beyond an already complex legal landscape. For example, Massachusetts instituted a physician payment disclosure law before the Federal Physician Payments Sunshine Act requirements set in during 2013.  While the Federal law preempts much of the Massachusetts measure, the state’s law includes more expansive definitions as to who constitutes a “covered recipient,” requiring additional resources and fees to comply.  

Furthermore, the state’s Pharmaceutical and Medical Device Manufacturer Code of Conduct is largely parallel to the PhRMA and AdvaMed codes that the respective industries follow.

“[C]onfusing, unnecessary, inconsistent and redundant government regulations inconvenience individuals, encumber cities and towns, stress resources of non-profit organizations, including our health care and educational institutions, inhibit business growth and the creation of jobs, and place Massachusetts for profit enterprises at a competitive disadvantage relative to their out-of-state and foreign competitors,” states the Order. In its assessment of the announcement the National Review noted:

For the citizens and businesses of Massachusetts, where state agencies have a long history of expansive regulatory programs, aggressive rule development, expansive regulatory programs, and sweeping administrative authority, this is an extraordinary measure, and it will undoubtedly reshape state government programs for many years to come.

This will be an important measure to follow and stakeholders should take advantage of the opportunity to participate in this regulatory review process. 

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