February 16, 2009
Physician Payments Sunshine Act back with sharper teeth
Sens. Chuck Grassley (R-IA) and Herb Kohl (D-WI) reintroduced their Physician Payments Sunshine Act, which would require that manufacturers and group purchasing organizations disclose all payments or transfers of value to physicians worth $100 or more.
The revised bill includes language mandating disclosure of physician investments in and ownership of manufacturers, and it has sharper teeth. Manufacturers or group purchasing organizations that fail to report payments can be fined between $1,000 and $10,000 per infraction, up to a total fine of $150,000 per company per year, where failure to report is deemed an oversight. For “knowing failure to report,” the ceiling on total fines goes up to $1 million per company.
Beginning in April 2011, companies would be required to report payments and other transfers of value for: consulting fees; compensation for other services; honoraria; gifts; entertainment; food; travel; education; research; charitable contributions; royalty or license fees; current or prospective ownership or investment interests; CME speaker fees and grants, along with anything else the HHS secretary deems necessary. Where payments are related to marketing, education or research specific to a covered drug, device, biological or medical supply, the company would be required to furnish that information, including the name of the therapy.
The legislation specifies that it should not preempt state laws, allowing states to require further disclosures.
The bill directs the secretary of the Department of Health and Human Services to establish a disclosure procedure for companies and to make the information available online in an accessible and easily searchable format. The legislation includes a clause allowing companies to delay reporting for up to two years payments made for clinical investigations or product development agreements regarding new drugs, devices, biologics and medical supplies.