Physician Payment Sunshine Act FAQs
Friday, September 27, 2013
This FAQ document follows the alert that PMRG, CASRO
and MRA issued on August 29, 2013 in response to critical questions and
concerns raised by our members regarding compliance with the Physician Payment
Sunshine Act and with the Final Rule promulgated by the Centers for Medicare
and Medicaid Services (CMS) in implementing that statute.
Reporting obligations under the Sunshine Act
began on August 1, 2013. Our first alert
emphasized that the law does not require the reporting of research honoraria
paid to physicians (and other covered health care providers, or HCPs) whenever
the pharmaceutical or device manufacturer is unaware of the HCPs' identities --
the statutory exclusion from the reporting obligations is not limited to
"double-blind" studies. The
first alert also emphasized that CASRO and MRA ethical guidelines require that
research companies must obtain the informed consent of HCP-respondents before
sharing their identities and their honoraria amounts with clients for any
reason, including for purposes of reporting to the government and public
posting on the Internet.
This second alert addresses three additional
issues that have arisen in recent weeks, as manufacturers and their research
companies undertake to comply with the Sunshine Act. This second alert is provided in the format
of Frequently Asked Questions. As to
each of the questions, the law is unsettled, and we are not offering legal
advice upon which our members should rely.
Rather, we are offering practical insights and suggestions based on our knowledge
of the settled law and of industry practice.
1. Manufacturer-Provided Sample.
Q. If a manufacturer provides a list of HCPs for the research company
to recruit, is the manufacturer deemed to be "aware of” the HCPs’
identities for Sunshine Act purposes, and thus obligated to report all the HCPs'
names and honoraria?
A: It depends on what portion of the list will ultimately participate
in the actual research. If almost all on the list will participate,
probably yes – the manufacturer effectively is "aware of” the
identities. If only a small percentage will participate, probably
no. Any percentage in between could give rise to a judgment call for the
manufacturer and the research company.
2. Adverse Event Reporting and Sunshine Act Reporting.
Q. If an HCP discloses an adverse event that a research company then
reports to a manufacturer for FDA compliance purposes, must the research
company also report the identity of the HCP to the manufacturer for those
purposes? If so, is the manufacturer then "aware of” the HCP’s identity,
such that the manufacturer must also report the HCP’s identity and honorarium
amount to CMS for publication on the Internet pursuant to the Sunshine Act?
If so, must each and every HCP -- in each and every study in which HCPs could
disclose adverse events -- consent to the potential reporting and
publicizing of his/her name and honorarium amount for Sunshine Act purposes, in
anticipation of the possibility, however small, that he/she might disclose an
adverse event during the course of the study?
A. To our knowledge, the law does not
require research companies to identify to manufacturers the names of HCPs who
report adverse events; nor does it address any of the other questions raised
above. But from a policy perspective, we believe that linking AE reporting of names to Sunshine Act
reporting obligations is inadvisable:
(a) Because the
manufacturers’ AE staff are different from their marketing staff, no undue
influence on prescribing behavior is likely to issue from any AE reporting; and
thus no positive purpose would be served by way of the link.
(b) Advising HCPs
that their AE reporting could trigger Sunshine Act reporting could chill AE
reporting – which is probably the last thing that the FDA would want to happen.
(c) Advising all
HCPs that their names and honoraria could be reported on the
Internet could seriously chill research participation (thus making recruiting
more expensive and less representative).
(d) If HCPs
learned that the manufacturer would have a greater chance of coming to know
their identities, that could bias research responses and make for bad research
(e) Reporting the
HCPs' identities to the manufacturers could facilitate the manufacturer unduly
influencing the HCPs’ prescribing behavior, contrary to the purposes of the
In any event, if so many HCPs were advised when being recruited
for a survey that their names and honoraria amounts could be posted on the
Internet, as a business proposition the manufacturer and the research company
would likely want to establish between themselves who would bear any increased
recruiting costs that could ensue from HCPs’ reluctance to participate in the
research, and whether sample design should be restructured so as to adapt to a
depleted respondent pool.
Given those issues, a less burdensome solution to the questions
posed in this FAQ could be for the research company to seek HCP consent for
identification – both for AE reporting and Sunshine Act reporting purposes –
only from those very few HCPs (if any) who will have actually mentioned AEs
during the course of the research; i.e., following the research session, not
when recruiting for it.
And the least burdensome approach would be for the research
company, when reporting AEs to the manufacturer, to simply not identify the
HCPs who have mentioned those AEs during the course of the research, since that
identification, to our knowledge, is not required by AE reporting law.
3. Recognizing HCPs During Qualitative Sessions.
The Sunshine Act’s exclusion of market research honoraria from the reporting
obligation applies only when the manufacturer is unaware of the identity of the
HCP respondent. If a manufacturer’s employee who is evaluating a research
study by observing a focus group session from behind a one-way mirror or
through a video recording of such a session happens to recognize one of the participating
HCPs, must the honorarium paid to that HCP be reported?
To our knowledge, instances of such recognition are infrequent to rare; and
when they do occur, in the spirit of marketing research ethical requirements,
they are not exploited by the manufacturers for sales or marketing
purposes. We meanwhile believe that the manufacturers’ ability to observe
focus groups without impediment is of enormous value to the development and deployment
of pharmaceutical products and medical devices, and thus to the delivery of
quality health care to Americans and the world community. Indeed, we
believe that that value far outweighs the negligible risk of undue influence on
prescribing behavior that could arise from the infrequent recognition scenario. We also believe that disclosing HCPs'
identities to manufacturers for Sunshine Act purposes could compromise the
candor of the focus group discussions, thus compromising the integrity of the
research and its value to health care delivery.
And just as fervently, we believe that pointedly disclosing the
identities of focus group participants to manufacturers under these circumstances would be more likely to create
an opportunity for undue influence than would not disclosing their identities;
and thus that non-disclosure would be more consistent with the policy goals of
the Sunshine Act.
We acknowledge that
the Sunshine Act and the CMS Final Rule do not speak directly to the focus
group recognition scenario. But rather than either limiting
manufacturers’ access to focus groups or undertaking to report some or all
focus group honoraria pursuant to the Sunshine Act, in a showing of good faith,
and in an abundance of caution, research companies and manufacturers may choose
to ensure that no undue influence will arise by pursuing one or all of the
(a) The research company
requiring every manufacturer-observer to sign a one-sentence promise not to
reveal the name of any HCP that he/she recognizes to his/her company, and not
to sell or market to such an HCP on the strength of that recognition; and/or
manufacturer-client promising the research company (e.g., within its master
service agreement with the research company) that (a) the manufacturer will
instruct its focus group observers not to reveal the identity of any HCP that
they recognize to other staff of the manufacturer, and (b) the manufacturer
will not market to any HCPs on the strength of focus group recognition; and/or
(c) Manufacturers implementing
written, internal confidentiality protocols relative to this matter, to the
extent they have not already done so.
manufacturer forego the above approach and instead require that the research
company disclose the identities of focus group participants to the manufacturer
for purposes of Sunshine Act reporting, we would urge research companies and manufacturers
to adopt the following protocols:
(i) The research companies and the
manufacturers should report the honoraria paid only to those focus group
participants that the manufacturer-observer actually recognizes, not all
participants. That is because reporting
all honoraria would clearly go beyond the requirements of the law, while
potentially creating significant disruptions in the quality and economics of
focus group research.
(ii) The research companies should
advise the HCPs at the outset of each study session that they may reduce the
chances of being recognized, and thus of having their identities and honoraria
amounts reported to the government and published on the Internet, if they avoid
identifying themselves by name during the session.
(iii) The manufacturers, not the
research companies, should take responsibility for determining which HCPs the
manufacturers' employees recognize (whether during the research session or
afterwards when viewing a video), and for reporting those identities to the
government. The research company need
not be involved in any aspect of the identification or reporting relative to
these "recognition" episodes.
(iv) As stated in the preceding FAQ,
manufacturers and research companies may wish to candidly discuss whether the
new reporting protocols are likely to chill physician participation in the
research; and if so, whether and how the sample design should be adjusted to
correct for that, and who (as between manufacturer and research company) should
bear any additional recruiting costs.
Members are again encouraged
to contact PMRG, CASRO and MRA if they have any questions about the Sunshine
Act or if they would like to schedule additional discussions. We would particularly welcome discussions
with manufacturers' legal and compliance departments, so as to maximize the
opportunity for and efficiency of dialogue, given the critical importance of
these issues to our industry.
contact is Executive Director Stephanie Reynders, at firstname.lastname@example.org, telephone
CASRO's contact is
President Diane Bowers, at email@example.com, telephone 631-928-6954.
MRA’s contact is CEO David Almy, at firstname.lastname@example.org, telephone 202-800-2545.