Nevada’s First Report on Compensation & Samples Distributed by Pharmaceutical Sales Representatives – Significant Number of Samples for Diabetes Drugs

The Nevada Department of Health and Human Services (“DHHS”) released the “Senate Bill 539 Report: Compensation and Samples Distributed by Pharmaceutical Sales Representatives in Nevada.” DHHS is required by law to create this annual report based on information that pharmaceutical sales representatives submit to DHHS.  The report shows that a large number of samples distributed to physician offices in Nevada are for diabetes drugs.

This article provides an overview of the registration and disclosure requirements, highlights from the report, and the takeaway for the industry (spoiler alert: expect a new reporting format for future years and more outreach by DHHS to manufacturers and sales reps).

About Registration & Disclosure

Under a 2017 Nevada law, pharmaceutical sales representatives that met specific registration criteria are required to register with DHHS (see registration procedures here). Sales reps are also required to annually submit names of health care providers or facilities that were provided payments or other transfers of value with a value that exceeded $10 or the value exceeded $100 in aggregate (“compensation”). Reps also have to submit information related to the provision of free samples, such as the name and manufacturer of each prescription drug and the name of each person that was provided a sample. DHHS required sales representatives, or the manufacturer on behalf of its sales reps, to submit the required information by March 1, 2018 (see reporting template here).

In turn, the law mandated DHHS analyze the information and submit a report to the Governor and the Director of the Legislative Counsel Bureau for transmittal to the Legislative Committee on Health Care and to the legislature on even-numbers years.

Report Highlights

DHHS provided that as of April 12, 2018, there were 2,572 active reps registered. But, only 52% (1,347) of sales reps submitted information. DHHS was unsure if the 48% were unaware of the law or had nothing to report.

Based on the total number of manufacturers that reported (154 companies), DHHS found the information to be “standardized and merged into one dataset.” The reports also identified whether the recipient was an MD/DO. However, DHHS was only able to match 13% of the records to physician licensing data. In comparison, 26% of the reports submitted by sales reps contained sufficient information to enable DHHS to determine if someone was a healthcare provider.

In the end, DHHS was able to identify “954 unique doctors” (596 primary care physicians; 358 all other specialties). Only 18% of the doctors receiving compensation included a monetary value. This is surprising since the requirements did not ask for a dollar figure to be submitted; instead, only a list of names.

A majority of the doctors received samples (60% or 558).  It is worth noting that 27% of the samples reported were for treating diabetes. One of law’s overarching purposes was to target manufacturers of diabetes medication.

Industry Takeaway

Based on the quality of the submitted data, DHHS indicated that “[a] report format will be prescribed in future years.” Because only 52% of sales reps submitted information to DHHS, the department stated that “[o]utreach to drug companies and sales representatives will be conducted in coming years to ensure compliance with statutory requirements.”

It remains unclear whether the report will trigger the Nevada Legislature to push for additional legislation. Considering the legislature meets on odd-numbered years, we will have to wait until 2019.

Keep in mind that while the registration and disclosure provisions apply to all types of prescription drugs, other portions of the law require non-profit organizations meeting certain criteria to compile a report in the State of Nevada and post it to a publicly available website (reporting procedures and guidance available here). In addition, manufacturers and pharmacy benefit managers are required to submit certain information concerning essential diabetes drugs (the list of essential diabetes drugs available here). Recently, DHHS adopted final regulations related to the 2017 law.

Nico Fiorentino collaborated on this article.