In response to the recent publication of physician payments, both on corporate websites, and by online media sources such as ProPublica, Eli Lilly recently published a Question and Answer section on its website with respect to the physician payment registry. The section included answers and questions for both the public and physicians.
Although these answers are specifically from Eli Lilly, we have adapted the responses to show people that many of the principles from this company are the same for all companies that collaborate with physicians.
It is also important to recognize that Eli Lilly is taking a proactive approach to physician payments by posting this information on their website to address any concerns of the public, including patients and physicians.
Public Q&A
Why do companies need to work with and make payments to physicians?
The research and development of innovative medicines is exceedingly complex and labor intensive. To ensure that clinical trials are designed to provide meaningful advances that matter to patients and their health care professionals, companies needs input—early on in the design of the trials and as those trials progress—from practicing physicians to ensure that companies are targeting their research efforts in studies and on questions that matter to the public and physicians.
Company physicians and researchers rely on the knowledge and expertise of external physicians to ensure they are applying the most current information to help them develop safe and effective medicines. Companies strive to do everything possible to ensure its medicines are tested thoroughly, are used safely and properly, and provide their intended benefit.
In addition, companies believe that they have a responsibility to ensure that health care professionals have knowledge about the safe and effective use of the medicines from companies that are already FDA approved for use. Since research has indicated that many physicians prefer to learn this information from their peers, companies partner with external health care professionals to provide educational sessions that focus on appropriate use of their medicines and the diseases they are approved to treat. Companies believe this education enhances a health care professional’s understanding of various treatment options and improves a patient’s overall health care management.
Is it a conflict of interest to pay for services provided by physicians who prescribe your products?
Companies do not believe that there is an inherent conflict of interest when physicians provide limited, bona fide services to companies under transparent conditions. They believe it is important to limit the amount of annual compensation they provide to contracted speakers and commercial consultants. For example Lilly instituted a cap several years before it was recommended by the PhRMA Code. This reflects Lilly’s belief that they need to also consider the overall amount of service payments they provide to individual physicians in order to preserve the confidence of the public, regulators, and legislators.
In response to increased public concern regarding potential conflicts, approximately 15 companies have taken a number of measures to publicly disclose their relationships. For example, at the beginning of an educational program Lilly and other companies require the contracted speaker to identify himself or herself as a compensated representative of the company. The speaker must state that the program is sponsored by the company and its alliance partner, if applicable, and, in the case of a health care professional education program, is not accredited for continuing medical education.
It is also important to recognize that many contracted physicians are associated with medical and academic institutions, and they follow their own conflict of interest policies or are subject to state regulations to which they are expected to adhere as well.
Many companies such as Lilly also require that contracted speakers and consultants agree, as a part of their contractual agreement with the company, that if they have a role in deciding what drugs are covered on health care plans with a public or private institution or payer, they will disclose that they have a contract with a company, the types of services they perform, and the amount of compensation they receive. Consistent with the PhRMA Code on interactions with health care professionals, this requirement extends for two years beyond the term of their agreement with the company.
Why are meals provided to physicians? How does this contribute to improving the care of patients?
Physicians and their staff are very busy and find it very difficult to take time away from patient care to keep up with product information and other medical developments. Consequently, Lilly and other companies often use the lunch and dinner hours as a time to exchange information and answer product questions with physicians and their staff. When such in-office lunch meetings occur, it is common for sales representatives to also take in meals or beverages, as a convenience courtesy.
Less often, but also common, physicians are invited to attend out of office presentations, which are longer and involve more in-depth presentations and discussion of medical information. In those out-of-office settings, companies offer a meal to participants for the same reasons above. Importantly, in all cases, the meal is reasonable and incidental to the main purpose of the interaction—the exchange of information important to patient care. Physicians provide companies with insights about patient care and companies share the latest information they have about their medicines including the benefits and risks, and the patients for which a medicine might be appropriate.
Why do companies provide airfare and hotel accommodations to physicians?
Companies provide reasonable travel-related expenses for physicians who are providing contracted services on their behalf.
Do the fees companies pay these physicians contribute to the cost of prescription drugs?
Companies could not research and develop medicines without the assistance of external physicians and researchers that represent many areas of expertise. These experts are either not available “in house” or can perform the services more effectively and efficiently than companies. External involvement in the pursuit for new innovative medicines is essential and part of the necessary costs for researching and developing medicines.
How do companies determine the amount it pays a physician?
Compensation rates vary based on the services the physician has been asked to provide as well as his or her credentials, experience, and expertise. The rate of compensation is also informed by a fair market value analysis, which considers the amount similarly situated physicians would earn from others for similar services.
How often will the Physician Payment Registry be updated?
The first report for the Physician Payment Registry will be posted online by August 1, 2011. Subsequent reports will be published quarterly.
What other data do companies make publicly available?
Eli Lilly noted that it publishes public information about clinical trials related disclosures through the Clinical Trial Registry, Educational grants and charitable contributions through the Lilly Grant Office, and the Lilly Faculty Registry which includes payments and reimbursed travel-related expenses to contracted Lilly Faculty members for speaking, speaker training, patient education, and commercial consulting activities. Other companies vary with the information they publish in addition to payments.
Physician Q&A
Can physicians choose not to have their names and payment information published?
No. If a physician receives a payment or non-cash form of disclosable value from Lilly or any other company, his or her name and the related value will automatically be disclosed in the Physician Payment Registry, with very limited exceptions. For example, consistent with the exclusions provided for in the Patient Protection and Affordable Care Act, there is an exception for payments or non-cash forms of value when a physician is serving as an expert witness for a company in connection with a legal proceeding. Also, due to the need to keep the underlying interaction confidential, there is an exception when companies provide non-cash forms of value (e.g., airline tickets, hotel accommodations, meals, etc.) to a physician that has undergone confidential interviews for a job with Lilly.
Will physicians get to review their data before it is published?
Lilly explained that they do not have the capability to enable physicians to review their data before publication. However, if a physician believes his or her data are inaccurate once it has been published, companies will work with the physician to resolve any questions.
Does the IRS require meals provided by Lilly to physicians to be reported as income to the recipient?
The U.S. tax code does not require the inclusion of the value of such business meals to be reported on Forms 1099 issued by Lilly. Lilly recommended that physicians consult their individual tax advisor for specific advice.