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“Sunshine” on Marketing, Research Payments Expands


As part of the legislation expanding the federal Open Payments program, drug and medical device manufacturers will have to report payments and other “transfers of value” to a broader range of health professionals.

Drug and medical device manufacturers will have to report payments and other “transfers of value” to a broader range of health professionals, as part of legislation enacted last year that expanded the federal Open Payments program. Included in a measure to further combat the opioid epidemic, Congress expanded the Sunshine initiative to collect information on payments or services provided to physician assistants, nurse practitioners, clinical nurse specialists, certified nurse anesthetists, and certified nurse midwives - in addition to the physicians and teaching hospitals already covered by the program. 

In many states these lower-tier health professionals can write prescriptions, including those for pain medications. As the main goal of the Open Payments program operated by the Centers for Medicare & Medicaid Services (CMS) is to uncover where financial relationships between drug and medical product manufacturers may influence prescribing or medical treatment, policy makers believe it is important to gain full information on how patients access prescription medicines. The specifics for expanding the Sunshine program were included in CMS’ proposed Physician Fee Schedule for 2020, published in the Federal Register in July. Manufacturers also will have to report payments to health professionals that involve debt forgiveness, certain acquisitions, and long-term loans for purchasing medical devices and supplies, and CMS is seeking comments on these changes through the end of September. 

This program expansion will require changes in data collection and reporting systems. Now five years old, the Open Payments initiative to promote transparency and accountability on industry-prescriber relations finds that manufacturers and hospital group purchasing organizations reported 11.4 million payments to about 630,000 health professionals and nearly 1200 teaching hospitals in 2018. However, more than half of the total $9.35 billion total - nearly $5 billion - involves industry outlays for research activities. About $3 billion falls under general payments for consulting, speaker programs, meals and travel, and $1.4 billion relates to licensing fees and other investment activities, according to CMS data for 2018 published June 28, 2019. 

CMS continues to improve and streamline the Open Payments data collection and reporting system to reduce errors involving what fees go to which doctors. Robin Usi, acting director of the CMS data sharing & partnership group, outlined enhancements in the system for validating physician licensing information, tracking pharma company compliance, and checking drug data. She noted at the CBI annual Forum on Transparency & Aggregate Spend in Washington, D.C. in August that the reporting category numbers have been very stable over the last five years. CMS aims to finalize policies related to the new data collection requirements by year-end to provide time for industry to adapt processes to handle additional payment reports for 2021. Data collection on the new health professional categories, however, will be complicated by differences in how states define and license these practitioners.

States push transparency

States are becoming more active in regulating industry marketing activities and payments to health professionals as part of efforts to regulate and expand disclosure of drug pricing information. Multiple state legislatures are debating drug price disclosure and reporting regulations, encouraged by recent transparency initiatives in Colorado, Nevada and others. A related Sunshine effort involves requiring registration of sales reps, as is the case in Chicago, Massachusetts and Nevada. 

A proliferation of local disclosure policies promises to be tricky for manufacturers to manage, particularly in markets such as Washington D.C. where sales and communications activities cross state lines. Most problematic is New Jersey’s $10,000 cap on industry fees to any individual physician, something that appears impossible for any individual pharma company to track. The requirement is prompting marketers to cancel speaker programs and meetings in the state. 

This expansion of Open Payments in the U.S. parallels wider transparency initiatives involving drug marketing and pricing in other regions. Europeans are looking to require disclosure of transfers of value to healthcare professionals, despite differences in how EU states define “transfers of value” and set reporting requirements. The European Federation of Pharmaceutical Industries and Associations (EFPIA) requires that its members disclose payments to health professionals for R&D purposes, but on an aggregate basis, and not naming individual investigators. Manufacturers in Japan have developed industry guidelines supporting public disclosure of payments to health care practitioners. Expanded interest in transparency on pharma marketing and research funding requires biopharma companies to broaden data tracking systems to support foreign markets, particularly in South America and Asia. 



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