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June 1, 2006
4 Min Read
Originally Published MDDI June 2006
Although the device industry has overwhelmingly adopted AdvaMed's code of ethics, it won't be as easy for some companies to put the code into action. A recent survey looked at how companies have applied the voluntary code, identified their best practices, and suggested that small companies might have more difficulty following the code.
Implementing AdvaMed's code of ethics may require a change in company culture, Peter Claude says.
"We came to the conclusion that it might be helpful to the industry, as it adopts the AdvaMed code, to be aware of better practices around implementing the various requirements of the code," says Peter Claude, partner in the pharmaceutical and life sciences advisory practice at PricewaterhouseCoopers LLP (New York City). "In other words, save everybody from sloughing through the same mess." The survey, consisting of 20 companies, was conducted by PricewaterhouseCoopers and King & Spalding LLP (Washington, DC).
The AdvaMed Code of Ethics on Interactions with Healthcare Professionals became effective in 2004 and was revised last year. According to Claude, it intends to level the playing the field regarding promotional activities. Although nearly all of the surveyed companies said they had adopted the code, implementing it isn't as simple.
"This isn't something that occurs overnight, and I think that was another key finding of our study," says Claude, who suggests that company cultures must change in some cases. "A lot of the companies in the medical device industry are entrepreneurial companies." Some employees work in an informal setting where they rely less on official procedures and more on just getting the job done.
"Following a code like this requires formalizing processes and approvals, and putting in checks to make sure that you're complying with the code," Claude says. "That's a field of bureaucracy that these entities have not typically felt, especially the smaller companies." Claude adds that small companies will need help in building a compliance process for enforcing the code and managing risks.
According to Brian Riewerts, the survey may help companies see what actions are necessary to achieve compliance.
The survey highlighted better practices involving sales and marketing tactics. The activities ranged from how companies participated in gift giving to guidelines for speakers at promotional events. This kind of survey is ammunition for compliance officers to do what's necessary to get their job done, according to Brian Riewerts, a partner at PricewaterhouseCoopers.
"It's sort of that coalescing around the mean in the compliance world," says Riewerts. "Few [companies] want to be the best at compliance, but they sure don't want to be the worst. They just want to find that happy medium where they can operate effectively within the bounds of the code."
Better practices cited in the survey included:
Having a list of preapproved gifts that representatives can purchase.
Limiting gifts, meals, and entertainment, regardless of employee title.
Addressing antikickback risks in contracts for every engagement that involves healthcare professionals.
On-site monitoring of speaker programs by compliance personnel.
Ensuring that compensation for the sales force is consistent with compliance expectations.
Claude hopes the survey will help manufacturers avoid the potential consequences involved in noncompliance. "You only have to look at the recent settlements in the medical device and pharmaceutical areas to see how improper sales and marketing can get you into significant trouble very quickly," he says. "The good news is that the decisions industry has made to date in the document code are generally thoughtful, reasonable, and much like what other industries have done in adopting similar codes. It seems that this is something that the industry really wants to make sure can work."
The survey results were released at the Medical Device Regulatory Compliance Congress in March. PricewaterhouseCoopers was a sponsor of the event.
Copyright ©2006 Medical Device & Diagnostic Industry
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