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Pharmaceutical industry code of conduct fails to find favour

Medicines Australia code of conduct for pharmaceutical companies has attracted a large number of negative submissions. hobvias sudoneighm/Flickr, CC BY-SA

The Australian Competition and Consumer Commission (ACCC) is considering whether to approve the latest Medicines Australia code of conduct for pharmaceutical companies.

The code lays out disclosure requirements for payments and other transfers of value (payment for sitting on drug company advisory boards; air-fares, accommodation and conference registration fees; funds for drug company-sponsored lectures). Doctors are influenced by such payments so it’s important that the public (and their colleagues) know the extent of the largesse.

The ACCC received 45 submissions about the draft and they tell an interesting story: a large number, from individuals and organisations alike, oppose the code.

Indeed, some of the submissions are positively furious. The Royal Australian College of General Practitioners (RACGP), for instance, claims consultation with stakeholders was ignored and a code that was meant to facilitate disclosure of payments fails to do so.

The push for disclosure

This isn’t the first time the code has faced public opposition. Its lack of transparency was raised in 2009 when the ACCC was considering the 16th edition, and again in 2012 when it was looking at the 17th edition.

Back then, the debate was stimulated by the introduction of the 2007 U.S. Physicians Payment Sunshine Act.

Passed in 2010, this law set the benchmark for transparency by mandating full public disclosure of the financial relationships between doctors and the pharmaceutical and medical device industry. Data collection under the Act started in August 2013 and public reporting is expected by September 2014.

In light of the Sunshine Act, the ACCC limited authorisation of the code’s edition 17 to just two years (rather than the five years sought by Medicines Australia), encouraging the body to improve transparency provisions.

The latest code “encourages” health-care professionals to consent to disclosure, while allowing them to opt-out and retain financial and other benefits of their interaction with pharmaceutical companies.

Medicines Australia’s code is weak partly because the none of other therapeutic goods industry associations has adopted transparency provisions in their own self-regulatory codes. These associations include the Generic Medicines Industry Association (GMiA), Australian Self Medication Industry (ASMI), Complementary Medicines Australia (CMA), Medical Technology Association of Australia (MTAA) and IVD Australia.

Some associations, such the MTAA, have never sought ACCC authorisation for their codes of conduct at all, while others, such as GMiA and ASMI, have opted out of the authorisation process.

Broadly, the ACCC may grant authorisation when it is satisfied that the public benefit from the conduct outweighs any public detriment. The ACCC’s authorisation enables member companies to engage in anti-competitive arrangements without the risk of legal action, for example, where the code imposes standards of behaviour that may restrict competition.

There’s also an increasing number of pharmaceutical companies that are not members of any therapeutic goods industry association and are thus not bound by any industry code.

So it’s not surprising that many members of Medicines Australia are worried that forcing full disclosure puts them at a competitive disadvantage with other therapeutic goods companies, especially companies that make generic medicines.

What the submissions say

Three of the 45 submissions received by the ACCC are by drug companies that support ACCC authorisation, although Pfizer concedes there are outstanding issues to be resolved.

Nine submissions are from professional organisations, ranging from the Australian Medical Association supporting the Code’s “realistic and common sense approach” to the clear recommendation of the RACGP that the ACCC not authorise the code because of transparency loopholes.

Three consumer organisations (CHOICE, Consumers Health Forum and Cancer Voices) concur with that view because the code fails to deliver on the key principles agreed to by Medicines Australia’s Transparency Working Group whose participants included member companies and a range of consumer and health professional groups.

Of the 30 remaining submissions, 23 came from people who had previously petitioned the ACCC during the authorisation of edition 17 to support transparency similar to the U.S. Sunshine Act.

They argue the ACCC should defer authorisation and refer this mess back to where the responsibility lies – the Australian Department of Health and the government, both of whom have failed to address the limitations of self-regulation.

These limitations were pointed out in 2011 by the government’s Working Group on Promotion of Therapeutic Products but have yet to be addressed. These submissions advocate legislation to ensure companies would agree to transparency provisions before their products are approved for marketing by the Therapeutic Goods Administration.

The remaining individual submissions make various points, including the need to include research funding by the pharmaceutical industry. Several argue the ACCC shouldn’t authorise the code until Medicines Australia made transparency a contractual condition for health professionals accepting “transfers of value”.

Another pointed out that, even with peer pressure, the last to agree to voluntary disclosure will be those we wish to know about first.

The final decision by the ACCC is expected before the end of the year. It will be interesting to see how much the public submissions affect it’s decision.

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