Connecticut Passes Adoption of Codes of Conduct

Last week the Connecticut legislature passed a bill requiring manufactures of pharmaceuticals and medicals devices to adopt a code of conduct at least as strict as the PhRMA and AdvaMed codes.

As we wrote last week, the Connecticut Senate was considering Substitute Bill 270, which contained provisions regarding gifts from industry to physicians and disclosure. In what was seen as a victory for patients, businesses and restaurants in Connecticut, the bill, which would have gone into effect on July 1, 2010, died Wednesday night. This should come as no surprise since the bill had very little bipartisan support as Democrats backed passage, and Republicans opposed it.

Final Bill

On or before January 1, 2011, each pharmaceutical or medical device manufacturing company must adopt and implement a code that is consistent with, and minimally contains all of the requirements prescribed in, the Pharmaceutical Research and Manufacturers of America's (PhRMA) "Code on Interaction with Healthcare Professionals" or AdvaMed's "Code of Ethics on Interactions with Health Care Professionals" as such codes were in effect on January 1, 2010.

Each pharmaceutical or medical device manufacturing company must also adopt a comprehensive compliance program in accordance with the guidelines provided in the "Compliance Program Guidance for Pharmaceutical Manufacturers" dated April, 2003 and issued by the United States Department of Health and Human Services (HHS) Office of Inspector General (OIG).

Complaints for these requirements may be investigated for an alleged (1) violation of the amendment and (2) failure to conduct any training program or regular audit for compliance with the adopted codes by a pharmaceutical or medical device manufacturing company.

The Commissioner of Consumer Protection may impose a civil penalty of not more than five thousand dollars for any violation of the amendment.

Conclusion

When it takes a typical biotech almost 15 years and $1.5 billion to bring one project from proof of concept to FDA approved drug, did Connecticut really need to make duplicative, unnecessary regulation that cause biotech to divert an employee from research and development to compliance? Adding no less than 23 duties and actions on Connecticut Biopharmaceutical companies was obviously not a good idea.

In fact, with Massachusetts unable to “attribute cost savings” with its legislation, the real impact is more likely that the stigma imposed on physician interactions is having a deleterious impact on patients whose doctors may or may not be aware of the latest information available on new therapies. As a result, this kind of legislation would have only increased Connecticut’s costs significantly and made companies invest elsewhere.

It would have also resulted in jeopardizing the 53,584 jobs in Connecticut (2006) supported by the biopharmaceutical industry, which would have produced an estimated $314.7 million in federal taxes and $54.2 million in state taxes paid by employees.

Accordingly, the success of defeating SB 270 shows that “patients want to encourage physician interaction with sales representatives because they understand that doctors often receive critical up to date information about treatments effects through their interactions with sales representatives.” Moreover, patients understand that commercial funding of clinical trials are necessary and not gifts because studies require a great deal of expenditures for both space and staff requirements.

Without the ability to have regular interactions with pharmaceutical representatives, physician’s academic and clinical knowledge and analyses of new products and devices are severely diminished. And since “there is no data to support that reduction of these biopharmaceutical industry interactions with physicians is a cost saving measure,” SB 270 and any other state measures are clearly duplicative and unnecessary.