Life Science Compliance Update

July 06, 2016

Colombia v. Novartis

Several weeks ago, Columbian Health Minister Alejandro Gaviria announced that he was going to find a way to force Novartis to lower the price of its Gleevec leukemia treatment. He started out by threatening to sidestep the drug patent and declare a compulsory license, but the decided to declare a lower price for the medicine under the guise that doing so would be in the public interest because it would save the country money.

Colombia's decision stops short of a compulsory license that would have stripped the drug's patent to allow for generic production. The country had feared that move would lead the U.S. to pull financial support in other areas, such as Colombia's peace talks.

Such a move by Columbia, where the focus is on imposing more price controls is unnecessary and a major threat to an innovative manufacturing environment. Such an environment is crucial to any country seeking economic growth, an improved standard of living, and better jobs.

It is likely that some politicos (and non-politicos) will hail these actions as a great move to protect "public health." Those will be the same folks who want and expect it all to be free, and will have never spent any time or money to create the new cures that the world is currently, and always will be, seeking. They will ignore the fact that the innovative life sciences sector not only provides millions of jobs, but it is also the necessary pipeline for the generic industry they tend to favor.

PhRMA spokesman Mark Grayson opposed to idea, stating, "This medicine is being provided to all Colombian patients who need it and at a price negotiated and agreed by the Colombian Government under its existing pricing system. Several competing versions are also available in Colombia, and there is no apparent shortage or evidence of other access issues. Under these circumstances, a declaration of public interest is unwarranted and unjustified."

The National Association of Manufacturers also opposes the decision made by Gaviria, noting that, "[t]here was no need for this action given that the product is already available at a significantly reduced price and there are already non-infringing generic versions available in the Columbian market."

According to Garvia, the declaration was prompted by a breakdown in negotiations between the Columbian government and Novartis. Novartis has not yet received official confirmation regarding the declaration, but so far, it is refusing to lower the drug's cost. The Colombian Medical Federation noted that sales of generic Gleevec have declined, possibly due to a decreased availability of the drug. It isn't clear how many Columbian patients aren't receiving treatment because of the pricing dispute.

Novartis is not commenting on the situation unless and until it receives official confirmation from the Columbian authorities. In a statement, a Novartis spokesman stated

Throughout this dialogue we have remained fully committed to finding a resolution that benefits patients, innovators and the Colombian health care system. We have received no official confirmation from the Colombian authorities regarding the conclusion of these talks. Until we do, it is not appropriate to make further comment. 

We have consistently said that Declarations of Public Interest can be important and legitimate tools to be used only in exceptional circumstances. This is simply not the case in Colombia. There are no shortages of Gleevec or other access issues. Colombia's universal healthcare system means all patients who need Gleevec receive it. Novartis does not have a monopoly. There are already noninfringing generic versions on the market, which the government could purchase instead of Gleevec in order to reduce its costs.

If Columbia's actions do stand, it may be time to truly start worrying about access to medicines for this Latin American country.

May 17, 2016

Growing Like Weeds - MedTech Europe Adopts New Code of Ethical Business Practice

Europe adopted a new Code of Ethical Business Practice late last year. This article explores the purpose of the new Code, standards found in the new code, as well as some material differences between this new Code and other Codes currently in existence.

The February issue of Life Science Compliance Update ("Update") reviewed a new code of conduct from the European Generic Medicines Association (EGA) In the March issue, the Update highlighted and compared some the major codes life sciences compliance officers regularly deal.

Now it appears that there is yet another new code that at least medical device compliance officers need to consider. On December 2, 2015, members of both the European Diagnostic Manufacturers Association ("EDMA") and the European Medical Technology Industry ("Eucomed") approved a new Code of Ethical Business Practice. Both associations are members of MedTech Europe who is working to raise the ethical standards of the medical technology industry all throughout Europe.

The full text of this article is available in the May 2016 Issue of Life Science Compliance Update

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May 09, 2016

Medicines for Europe Adopts Physician Payment Reporting Requirements Starting 2017

The European Generics Medicines Association is undergoing a "rebranding" of sorts. They recently changed their name to "Medicines for Europe," and have expanded into value added medicines, "aimed at optimizing, rethinking, and reinventing existing medicines based on known molecules, addressing unmet medical needs of patients through improved care delivery systems."

In addition to the aforementioned changes, Medicines for Europe also recently published their Code of Conduct, which requires reporting for physician payments starting in 2018 for payments made in 2017. The Code is similar to the EFPIA Code, and in 2018, there will be one system for Europe.

Disclosing Transfers of Value

The Code requires that Medicines for Europe member companies disclose Transfers of Value that "could potentially pose a conflict of interest, or to encourage the recipients of the transfers of value to disclose them, where such disclosure would be in the best interest of patients or the public." Such mandated disclosures also include Transfers of Value made by a third party on behalf of a Medicines for Europe member company for the benefit of a recipient, when the Medicines for Europe member company knows about the recipient who will benefit.

Transfers of Value to be reported are allocated to different categories under the Medicines for Europe Code. Any Transfers of Value that are not listed in the Code are not required to be disclosed.

Transfers of Value to Patient Organizations

These transfers, made up of both financial and in-kind support, shall be disclosed on an individual, named basis. The reporting shall include fee for services, including a description of the nature of the Transfer of Value and the amount provided.

Transfers of Value to Healthcare Professionals

This includes fees for services and for consultancy: aggregated honoraria paid by a Company to a Healthcare Professional in exchange for providing services (not including meals, drinks, travel, and accommodation). These may include items such as: serving as an expert on an advisory board, speaking at a company-organized educational event, or participating in a focus group. Fees paid in connection with research and development are not included with this group.

Meetings, Educational Support, and Site Visits

For these forms of Transfers of Value, members have their choice of one of two options for disclosure.

Option one: member companies must report the total number (not actual monetary value) of events, for which individual healthcare professionals have received support. Support shall be disclosed per individual healthcare professional in the following categories: sponsorship for attending a third party organized congress (must be indicated whether the event is local/domestic, within Europe or outside of Europe); site visits; and company organized meetings for which a healthcare professional receives company funded hotel accommodation and/or airplane travel.

The second option requires companies to report the aggregate total amount of support provided to healthcare professionals per individual conference or meeting as follows: sponsorship for attending a third party organized congress (including the name of the congress, the aggregated amount spent for the congress, and the number of healthcare professionals financially supported to attend); site visits (including the aggregated amount spent and the number of healthcare professionals financially supported to attend); company organized meetings (including the aggregated amount spend and the number of healthcare professionals financially supported to attend); and transfers of value to healthcare organizations (including fees for services and consultancy and the aggregated monetary amounts of any grants or donations, along with a brief description of the nature of the grant or donation).

Additional Requirements

In addition to its disclosure, each Medicines for Europe member company shall publish a note summarizing the methodology they applied in preparing the disclosure and identifying Transfers of Value for each category. It is recommended that companies include the VAT and any other taxes in the disclosure amount, as required by local laws and regulations. Companies are also advised to make their disclosures in Euro and local currency.

Other Sections including Hospitality

Other sections of their newly adopted code of conduct include that companies can only pay for coach class tickets on flights for conference attendees, consultants and speakers except for exceptional circumstances and a prohibition on stopovers. Consulting payments must be made at fair market value. They adopted a prohibition on standalone hospitality and entertainment. A ban on luxury hotels, resorts, venues known for their entertainment or recreational value, or extravagant venues even if they cost less than normal hotels or venues.

The criteria for supporting educational events includes:

  • Therapeutic areas of interest to the company;
  • Healthcare Professional's expertise, knowledge, experience, areas of scientific or medical interest, and related educational needs;
  • Geographic location of the Healthcare Professional and distance to the educational event;
  • Alternative educational opportunities;
  • The reputation, means and need of the institution employing the Healthcare Professional;
  • Reputation and standing of the Healthcare Professional in the scientific or medical community
  • Experience with a company's products may be considered in connection with company-sponsored third party events and company-Organized Meetings;
  • Potential impact on the quality of patient care; and
  • The ability, willingness and likelihood of the recipient to further share the knowledge gained with others.

Of Note

This reporting requirement differs from the Code promulgated by MedTech Europe (an alliance of European medical technology associations, formed by EDMA and Eucomed), which does not require reporting. It will be interesting to see if reporting requirements and transparency start to become newsmakers in the medical device and medical technology world the same way they have in the pharmaceutical world.

Helpful Documents

Medicines for Europe Code of Conduct

Medicines for Europe Code of Conduct Q&A

Medicines for Europe Enforcement Guidelines


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