ACCC proposes to strengthen new individual reporting in pharmaceutical code

17 October 2014

The Australian Competition and Consumer Commission is proposing to grant conditional authorisation to edition 18 of Medicines Australia’s Code of Conduct (the Code) for five years. The Code sets the standards for the marketing and promotion of prescription pharmaceutical products in Australia by member companies.

The issue of individual disclosure has been a matter of debate for a number of years, When authorising edition 17 of the Code in 2012, the ACCC made clear that it expected Medicines Australia to complete its review of transparency and introduce greater disclosure around sponsorship and fees paid to individual doctors.

In edition 18, Medicines Australia has proposed a new reporting regime which requires reporting of ‘transfers of value’ (such as speaking fees, advisory board fees or sponsorship to attend a conference) made to individual healthcare professionals, subject to the healthcare professional’s consent.

“The ACCC supports the introduction by Medicines Australia of a regime to provide transparency about payments provided to individual doctors by drug companies,” ACCC Commissioner Sarah Court said.

“However under the proposed regime, if a doctor does not consent to the reporting then the individual payment will not be disclosed and will only be reported in aggregate.”

This issue was raised in submissions received by the ACCC. While there was near unanimous support for an individual transparency regime, a number of interested parties raised concerns about ‘opt-in’ reporting.

“If a patient does not know what payments made to doctors by drug companies have and have not been reported, it will be difficult to use or rely upon the reporting. This will result in incomplete information and may fundamentally undermine the potential benefits of individual disclosure,” Ms Court said.

The ACCC is therefore proposing to require changes to the Code that will mean that all relevant transfers made by pharmaceutical member companies to individual healthcare professionals are reported. To ensure any privacy issues are addressed, this will mean that member companies must confirm that a healthcare professional has agreed to have their details reported, or is reasonably aware that their details will be reported, prior to the transfer taking place.

In Edition 18 of the Code, Medicines Australia has removed the requirements to report hospitality provided by member companies and instead imposes a $120 per meal cap on food and beverages. The ACCC supports a cap on hospitality but is considering imposing a condition requiring some form of continuing transparency around the provision of hospitality, given the potential conflict of interest that can arise. The ACCC has posed several possible approaches and is seeking interested party feedback.

More generally, the ACCC accepts that the Code continues to provide a framework for interactions between pharmaceutical companies and healthcare professionals and that the Code is likely to result in public benefits including protecting the public from inappropriate advertising, setting consistent standards for medical and promotional material and providing the potential for greater transparency around the relationships between pharmaceutical companies and healthcare professionals. The ACCC also notes that the Code results in minimal detriment.

As such, subject to the proposed condition of authorisation, the ACCC is proposing to grant authorisation for five years.

Medicines Australia states that it represents the interests of the innovative medicines industry in Australia. The Code provides standards for appropriate advertising, the behaviour of medical representatives and relationships with healthcare professionals. All member companies of Medicines Australia must adhere to the Code, although membership of Medicines Australia is voluntary.

Authorisation does not represent ACCC endorsement of a code. Rather, it provides statutory protection from court action for conduct that meets the net public benefit test and that might otherwise raise concerns under the competition provisions of the Competition and Consumer Act (2010). Broadly, the ACCC may grant an authorisation when it is satisfied that the public benefit from the conduct outweighs any public detriment.

Further information is available on the Public Register.

Release number: 
MR 254/14
Media enquiries: 
Media team - 1300 138 917

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