AdvaMed

1
AdvaMeds 2009 Guidelines Effect on Health Care
Provider Consulting AgreementsMassachusetts
Biotech Council

• March 12, 2009

2
What is AdvaMed and Why Do We Care?

• Advanced Medical Technology Association (AdvaMed)
  
• On December 18, 2008, AdvaMed's Board of
  Directors unanimously approved a major update of
  the Code of Ethics on Interactions with Health
  Care Professionals.  Effective July 2009.
• The revised Code further clarifies and
  distinguishes between appropriate and
  inappropriate activity between health care
  professionals and representatives of AdvaMed
  member companies.
• It also presents non-member companies with an
  opportunity to adopt the AdvaMed Codes
  principles and unite industry in addressing
  common issues in a consistent manner.

3
Primary Reason We Care About AdvaMed

• Rep. Henry Waxman Chairman of House Energy and
  Commerce Committee
• In January 2009, characterized FDA guidance on
  journal articles concerning off-label use of
  approved drugs "In the final hours of this
  Bush administration, political appointees at
  FDA have given drug companies a long-coveted
  parting gift."
• AdvaMed had argued that the original wording
  would have disadvantaged 510(k)-cleared products,
  which generally do not undergo randomized,
  controlled clinical trials.
• The new wording is very close to what the trade
  group had requested in April 2008 comments to FDA.

4
PhRMA Guidelines for Healthcare Professional
Consultants

• No token consulting or advisory arrangements
  must provide evidence of a bona-fide consulting
  arrangement.
• Requirement of a written contract which includes
  basis for payment
• Number of healthcare professional consultants
  should not be greater than that which is
  reasonably necessary for the purpose of the
  project
• Company must maintain adequate records of
  services provided and demonstrates appropriate
  use of those services

5
AdvaMed Guidelines

• On December 18, 2008, AdvaMed's Board of
  Directors unanimously approved a major update of
  the Code of Ethics on Interactions with Health
  Care Professionals.  Effective July 2009.
• The revised Code further clarifies and
  distinguishes between appropriate and
  inappropriate activity between health care
  professionals and representatives of AdvaMed
  member companies.
• It also presents non-member companies with an
  opportunity to adopt the AdvaMed Codes
  principles and unite industry in addressing
  common issues in a consistent manner.

6
Consulting Arrangements with HCPs

• Purpose. Companies pay fair market value
  compensation for consulting services that are
  intended to fill a legitimate business need and
  do not constitute unlawful inducement.

7
AdvaMed Guidelines Suggest

• Criteria for HCP Consulting Agreements
• When a Company contracts with a consultant to
  conduct clinical research services, there should
  be a written research protocol appended to the
  contract.
• Consulting arrangements should be entered into
  only where a legitimate need for the services is
  identified in advance and documented.
• Selection of a consultant should be made on the
  basis of the consultants qualifications and
  expertise to meet the defined need.
• Compensation paid to a consultant should be
  consistent with fair market value in an arms
  length transaction for the services provided .
• A Company may pay for documented, reasonable and
  actual expenses incurred by a consultant that are
  necessary to carry out the consulting
  arrangement, such as costs for travel, modest
  meals, and lodging. Every effort should be made
  to avoid need for travel.

8
Contracts Associates Suggested Language

• No Obligations. The financial support provided to
  Physician under this Agreement imposes no
  obligation, express or implied, to purchase,
  order, lease or give favorable formulary
  treatment to any Company product, or to arrange
  for or recommend the purchase, order, lease or
  favorable formulary treatment of any Company
  product.
• Compliance with Policies. If Physician is a
  faculty member at or employee of a university or
  hospital (Institution) or of another company,
  Physician represents and warrants that pursuant
  to Institutions or companys policies concerning
  professional consulting and additional workload,
  Physician is permitted to enter into this
  Agreement. If Physician is required by
  Physicians Institution to disclose to it any
  proposed agreements with industry, Physician has
  made that disclosure.

9
Where Can We Get More Detail on HCP Relationships?

• http//www.advamed.org/MemberPortal/About/code/

10
Closing Comments

• Colleen M. Sproul, Contracts Associates, Inc.
• Phone [phone]
• Email cms_at_contractsassociates.com or visit us at
  www.contractsassociates.com
• THANK YOU!