Promotional Activities

Detailing

Detailing is a common promotional activity in which sales representatives engage. Typically, sales representatives will visit a physician’s office to discuss pertinent product attributes and offer, and often leave, samples for the physician to provide to patients. Since practitioners are generally busy, sales representatives often find it difficult to gain access to them to ensure that they are well informed about pharmaceutical products. Consequently, sales representatives will often develop relationships with the practitioners, so that time during meals and entertainment events can be utilized to convey information. This is an important sales technique. In addition, by developing relationships, sales representatives are able to have more candid conversations regarding product assessment and the need for new products in therapeutic categories, while gaining insights from practitioners for the benefit of the pharmaceutical industry.

In order to mitigate the risk of off-label promotion, training materials must be developed and delivered that constantly reinforce the need for compliance and the consequences of noncompliance.

Sales aids provided to Sales Representatives should outline the benefits and risks of their products, advantages over competing products, and current post marketing research on the products. All advertising and promotional materials at a minimum should go through legal and regulatory review.

Finally, the Sales Representatives need to be instructed on what is and what is not “off-label” and the procedures for addressing physician questions with regard to off-label topics.

Round Tables

Round Tables, another common promotional activity, pose risks if there is a lack of procedures and guidance in place to educate the sales force on how to conduct these events appropriately. Round Table events are usually held at a restaurant with as many as a dozen attendees, where a physician speaker is paid by a drug manufacturer to facilitate the meeting and to explain the indicated uses, treatment protocols, relevant concerns, and other details regarding pharmaceutical products to other physicians. Compensation for presenting at Round Tables needs to be fair market value and meet safe harbor criteria. The pharmaceutical manufacturer usually has the speaker enter into a non-disclosure agreement prior to the roundtable engagement. Manufacturers should conduct mandatory speaker training to ensure the physician representing the pharmaceutical manufacture does not deviate from applicable regulatory requirements that govern these events.

Historically, companies did not have any other written agreements with the speakers. The amount of compensation often was not established ahead of time. Traditionally, the physician would write a short letter requesting payment and setting forth the amount. Fees paid in this manner have been referred to as “honoraria.” However, in order to avoid being accused of promoting off-label uses or of providing kickbacks to physicians, companies should demonstrate due diligence in creating speaker contracts and provide more guidance and requirements to physicians with regard to presentation materials. In many cases, companies will hire a third party to develop presentation materials in order to remain at a distance from the content.

State Marketing Requirements

Over the past few years, pharmaceutical companies have been inundated with the issuance of rules and requirements affecting marketing practices at the state level. Many pharmaceuticals have disregarded these new requirements, because penalties for non-compliance have not been enforced and complying would not be easy given the current systems and processes in place. The reality is, as state governments continue to collaborate and issue new rules, pharmaceutical manufacturers must take a more stringent approach to compliance.

Many Corporate Compliance Offices have initiated state compliance programs to understand and apply a consistent process for identifying, interpreting, and determining the impact of the requirements, and to revise current procedures or implement new procedures to ensure adherence to the state requirements.

The following areas have been scrutinized by the states, and as result new reporting requirements are in place.

1. State Spending Laws may pertain to the following:

  • a. Gifts and Entertainment: Including, but not limited to, cost of food, entertainment, gifts (typically valued at more than $25) per day, or anything provided less than market value to providers. Costs of trips and travel provided to providers. Costs of product samples provided to providers. Costs of free or in-kind services to providers.

  • a. Advertising, Marketing, and Direct Promotion: All expenses associated with advertising, marketing, and direct promotion of prescription drugs through radio, television, magazines, newspapers, direct mail and telephone communications made to residents of the particular state. In some circumstances there are exceptions, such as advertising and promotional activities purchased for a regional or national market.

  • b. Economic Benefits for Providers, which may include: Support for independent or continuing medical education programs (IME or CME). Including payments to medical education companies. Printing cost of patient education materials and disease management materials distributed to health care providers. Payments of consulting fees and expenses (indirectly and directly). Payments made directly or indirectly to health care providers for participation in speaker’s bureaus and honoraria or other payments for time while speaking at or attending meetings, lectures or conferences. Payments made indirectly or directly for writing articles or publications, and charitable grants.

Pharmaceutical companies will need to keep a pulse on the state requirements being issued. The future trend is the list will only continue to grow. A strategy for reviewing and interpreting these requirements, as well as a response to report requirements will need to cover all affected areas.