In the Field with Neil: Observations from Neil Mellor, Business Development Consultant
“When the US sneezes,” as they say, “Canada catches a cold.” This cliché could not be more apt for the Canada pharmaceutical executive when it comes to managing relationships with key opinion leaders (KOLs). Canada is still a long way off from having similar regulatory activity to the US, with regard to governing interaction with healthcare professionals, but Canadians should pay attention to what is happening south of the border.
The Office of the Inspector General (OIG) is a well-known entity to any US pharmaceutical sales representative, product manager, sales or marketing executive. The OIG is a division of the US Department of Health and Human Services and has strict powers governing how the US pharmaceutical industry engages with KOLs and promotes pharmaceutical products. According to The OIG’s website (http://oig.hhs.gov/), “The OIG’s duties are carried out through a nationwide network of audits, investigations, inspections and other mission-related functions performed by OIG components.” The OIG has sweeping powers to investigate, prosecute and fine, if necessary, or even invoke jail terms. Since 2000, over $11.7 billion in legal settlements have been collected by the OIG from pharma companies promoting off-label usage of their products or violating the agency’s expectations of how the industry should interact with KOLs.
Canada can consider itself fairly lucky. Rx&D Canada is still regarded by many pharmaceutical companies as lacking sufficient empowerment when it comes to enforcing the rules of KOL engagement. Interaction with KOLs is not on the radar screen of Health Canada, the foremost Canadian healthcare regulatory body. The first step in enforcing KOL engagement is Rx&D, Canada’s research-based pharmaceutical industry organization. Membership in Rx&D is voluntary, and the self-policing and subsequent action against violators is quite limited. According to Rx&D’s website, there was only one violation published for 2009, and the penalty was a $10,000 fine and public disclosure of the offense. In the event of a second infraction, the fine increases by an additional $5,000 and public disclosure again. In a world where many American healthcare executives perceive Canada as an overly bureaucratic country with government-mandated low prices, Canadians remain a long way from the oversight and litigation which haunts every American pharmaceutical employee.
And if you thought the US could not go much further, the Physician Payments Sunshine Act will be coming into force on March 30, 2013. The “Sunshine Act” as it is called, requires companies to begin recording any physician payments exceeding $100. That threshold includes stock options, research grants, giveaways, consulting fees, and travel expenses to medical conferences. The details will be posted in a searchable database starting Sept. 30, 2013. The measure is based on a bill that was introduced more than two years ago by Sens. Charles Grassley (R-Iowa), and Herb Kohl (D-Wisconsin).
So in the Great White North, Canadians remain surprisingly “under-governed” relative to their American counterparts. Even though Canadians have the benefit of minimal regulations when it comes to KOL engagement, it is important to maintain transparency in reimbursement of KOLs for services rendered and to ensure compensation is fair and reasonable. The American OIG is very concerned over how pharmaceutical companies may use thought leaders to “influence” other physicians. Furthermore, the agency believes that companies should not use a given KOL for consultation purposes based on his or her prescribing habits. As a result, many pharmaceutical companies are now recruiting KOLs based on their skills and experiences, rather than their histories of prescribing certain medications. This policy ensures transparency and keeps pharmaceutical companies on the right side of all Canadian laws, including PIPEDA and the various medical association guidelines. Most importantly, engaging KOLs based on skills and experiences represents a good business practice, since it focuses on individual strengths within their academic field, such as research, presenting at conferences, publishing in scientific journals, and speaking to lay audiences. The court of public opinion is a strong one. By interacting with KOLs the right way, companies will avoid mandated government oversight and unnecessary public humiliation on both sides of the fence.