Last month, the Massachusetts State Senate unveiled a far-reaching healthcare reform bill that would, among other provisions, impose a ban on all gifts to healthcare providers and their immediate family members. The gift ban provision of the bill—titled An Act to Promote Cost Containment, Transparency, and Efficiency in the Delivery of Quality Healthcare (S 2526)—would apply to medical device manufacturers as well as pharmaceutical and biotechnology companies.

The state senate passed the legislation on April 17, leaving the gift ban provision intact, says Tom Sommer, president of the Massachusetts Medical Device Industry Council (MassMedic; Boston). “In addition, an amendment was approved that would establish a licensing procedure that would require sales reps and any other life sciences company reps to obtain a license and pay an annual fee of $500 to interact with healthcare professionals in the state,” Sommer says. “We're working with key members of the Massachusetts House to knock this provision out of the bill.”

As proposed, the legislation defines the term gift broadly, as “a payment, entertainment, meals, travel, honorarium, subscription, advance, services, or anything of value, unless consideration of equal or greater value is received.” Although the legislation outlines the proposal under the heading “Pharmaceutical Industry Gift Ban,” it lumps the promotion of medical devices in with its definition of who constitutes a pharmaceutical manufacturer agent.

In detailing the ban, the proposed legislation states, “No pharmaceutical manufacturer agent shall knowingly and willfully offer or give to a physician, a member of a physician's immediate family, a physician's employee or agent, a healthcare facility or employee or agent of a healthcare facility, a gift of any value.”

Violations of the ban could be punished through fines of up to $5000, by imprisonment for no more than two years, or both.

Following the bill's introduction in the Senate, MassMedic sent a letter to all members of the Massachusetts State Senate. In it, Sommer voiced strong opposition to the gift ban provision of S 2526 and urged the senate to allow medical device companies to incur reasonable expenses related to medical device education and training for healthcare professionals.

In the letter, Sommer stated, “While MassMedic applauds the Senate's efforts to contain healthcare costs and promote transparency in the healthcare system, we are concerned that Section 22 of the legislation, the Pharmaceutical Industry Gift Ban, will have a negative effect on the ability of medical device manufacturers to provide the training and education necessary to operate a range of innovative medical products. MassMedic is also concerned that this language would criminalize ordinary business practices such as providing refreshments at an educational seminar.”

Sommer also pointed to the fact that many companies within the medical device industry have already adopted voluntary codes—such as the Code of Ethics on Interactions with Healthcare Professionals developed by industry association AdvaMed (Washington, DC)—that limit gifts and prohibit cash payments to healthcare purchasers and providers.

“Additionally, the national and state organizations representing physicians and hospitals have approved guidelines regarding interaction with life sciences industries,” Sommer wrote. “The issuance of these multiple codes of ethics have made payments for entertainment, lavish gifts, and meals an unacceptable practice by medical device manufacturers in the United States.”

Massachusetts' proposed ban on gifts to healthcare practitioners represents an extreme example of a much broader move to limit the perceived financial influence that pharmaceutical and medical device manufacturers wield over their customers. For example, last month, Representatives Peter DeFazio (D–OR) and Pete Stark (D–CA) introduced a companion bill to the Senate's Physician Payments Sunshine Act. Both bills (HR 5605 and S 2029) would require many drug and device manufacturers to file quarterly reports listing all physician payments and gifts with a value of $25 or more. For more details on the implications of the legislation, check out the article “Sunshine and Its Glare,” by attorney Wayne Wolff, in the upcoming May/June issue of MX magazine. For past coverage of the Sunshine Act in MX: Issues Update, visit http://devicelink.com/mx/issuesupdate/08/03/Sunshine.html.

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