HB1518 (2008) Detail

Relative to prescription drug marketing, restrictions, and disclosure.


HB 1518-FN – AS INTRODUCED

2008 SESSION

08-2590

01/09

HOUSE BILL 1518-FN

AN ACT relative to prescription drug marketing, restrictions, and disclosure.

SPONSORS: Rep. Donovan, Sull 4; Rep. B. Richardson, Ches 5; Rep. Franklin, Sull 2; Rep. Jillette, Sull 2; Rep. MacKay, Merr 11

COMMITTEE: Commerce

ANALYSIS

This bill establishes prescription drug marketing restrictions and disclosures. Under this bill, no pharmaceutical manufacturer agent shall knowingly and willfully offer or give to a health care practitioner or certain other persons a gift of any value. The bill also establishes advertising and marketing reporting requirements for manufacturers or labelers of prescription drugs that distribute prescription drugs to residents of New Hampshire. The bill grants rulemaking authority to the commissioner of the department of health and human services for the purposes of the bill.

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Explanation: Matter added to current law appears in bold italics.

Matter removed from current law appears [in brackets and struckthrough.]

Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.

08-2590

01/09

STATE OF NEW HAMPSHIRE

In the Year of Our Lord Two Thousand Eight

AN ACT relative to prescription drug marketing, restrictions, and disclosure.

Be it Enacted by the Senate and House of Representatives in General Court convened:

1 New Chapter; Prescription Drug Marketing Restrictions and Disclosure. Amend RSA by inserting after chapter 126-Q the following new chapter:

CHAPTER 126-R

PRESCRIPTION DRUG MARKETING RESTRICTIONS AND DISCLOSURE

126-R:1 Purpose. The purpose of this chapter is to improve the quality of prescribing medications and medical decision making and to reduce the incidence of complications from inappropriately prescribed medications by restricting inappropriate marketing to physicians and other medical practitioners. The purpose of the provisions of this chapter relating to reporting of marketing activities is to assist the state in its role as a purchaser of prescription drugs and an administrator of prescription drug programs, enabling the state to determine the scope of prescription drug advertising and marketing costs and the effect on the cost, utilization, and delivery of health care services.

126-R:2 Definitions. In this chapter:

I. “Bona fide clinical trial” means any research project that prospectively assigns human subjects to intervention and comparison groups to study the cause and effect relationship between a medical intervention and a health outcome.

II. “Commissioner” means the commissioner of the department of health and human services.

III. “Department” means the department of health and human services.

IV. “Health care practitioner” or “practitioner” means a person who prescribes prescription drugs for any person and who is licensed or certified to provide or otherwise lawfully providing health care or a partnership or corporation made up of those persons or an officer, employee, agent, or contractor of that person acting in the course and scope of employment, agency, or contract related to or supportive of the provision of health care to individuals.

V. “Gift” means a payment, food, entertainment, travel, honorarium, subscription, advance, services, or anything of value, unless consideration of equal or greater value is received. A gift includes anything of value provided to a health care professional for less than market value. “Gift” shall not include anything of value received by inheritance, a gift received from a member of the health care practitioner’s immediate family or from a relative within the third degree of consanguinity of the health care practitioner or of the practitioner’s spouse or from the spouse of any such relative, or prescription drugs provided to a health care practitioner solely and exclusively for use by the practitioner’s patients.

VI. “Immediate family” means a spouse and any dependent children residing in the reporting person’s household.

VII. “Labeler” means a person or entity that:

(a) Receives prescription drugs or biological products from a manufacturer or wholesaler;

(b) Repackages the drugs or biological products for later resale; and

(c) Has a labeler code from the federal Food and Drug Administration under 21 C.F.R. section 207:20.

VIII. “Marketing” means advertising and promotional activities, including, but not limited to, the activities described in RSA 126-R:4.

IX. “Medical device” means an instrument, apparatus, implement, machine, contrivance, implant, in vitro reagent, or other similar or related article, including any component, part, or accessory, which is:

(a) Recognized in the official National Formulary, or the United States Pharmacopeia, or any supplement to them;

(b) Intended for use in the diagnosis of disease or other conditions, or in the cure, mitigation, treatment, or prevention of disease, in man or other animals; or

(c) Intended to affect the structure or any function of the body of man or other animals, and which does not achieve its primary intended purposes through chemical action within or on the body of man or other animals and which is not dependent upon being metabolized for the achievement of its primary intended purposes.

X. “Person” means a business, individual, corporation, union, association, firm, partnership, committee, or other organization or group of persons.

XI. “Pharmaceutical marketer” means a person who, while employed by or under contract to represent a pharmaceutical manufacturing company, engages in pharmaceutical detailing, promotional activities, or other marketing of prescription drugs in this state to any physician, hospital, nursing home, pharmacist, health benefit plan administrator, or any other person authorized to prescribe, dispense, or purchase prescription drugs. “Pharmaceutical marketer” does not include a wholesale drug distributor, a representative of such a distributor who promotes or otherwise markets the services of the wholesale drug distributor in connection with a prescription drug, or a retail pharmacist if such person is not engaging in such practices under contract with a pharmaceutical manufacturing company.

XII. “Pharmaceutical manufacturing company” means any entity which is engaged in the production, preparation, propagation, compounding, conversion, or processing of prescription drugs, either directly or indirectly by extraction from substances of natural origin, or independently by means of chemical synthesis, or by a combination of extraction and chemical synthesis, or any entity engaged in the packaging, repackaging, labeling, relabeling, or distribution of prescription drugs. “Pharmaceutical manufacturing company” does not include a wholesale drug distributor or a retail pharmacist or a medical device manufacturer that distributes drugs as an incidental part of its device business.

XIII. “Pharmaceutical manufacturer agent” means a pharmaceutical marketer or any other person who for compensation or reward does any act to promote, oppose or influence the prescribing of a particular prescription drug or medical device or category of prescription drugs or medical devices. “Pharmaceutical manufacturer agent” shall not include a licensed pharmacist, licensed physician, or any other licensed health care professional with authority to prescribe prescription drugs who is acting within the ordinary scope of the practice for which he or she is licensed.

XIV. “Prescription drugs” means any and all drugs upon which the manufacturer or distributor has placed or must, in compliance with federal law and regulations, place the following or a comparable warning: “Caution federal law prohibits dispensing without prescription.”

XV. “Public official” means any state, municipal, or county employee.

XVI. “Significant educational, scientific, or policy-making conference or seminar” means an educational, scientific, or policy-making conference or seminar that offers continuing medical education credit, features multiple presenters on scientific research, or is authorized by the sponsoring association to recommend or make policy.

126-R:3 Restrictions on Gifts. No pharmaceutical manufacturer agent shall knowingly and willfully offer or give to a health care practitioner or a member of a health care practitioner’s immediate family or a health care facility or employee or agent of a health care facility or a public official a gift of any value. No health care practitioner or member of a health care practitioner’s immediate family or health care facility or employee or agent of a health care facility or public official shall knowingly and willfully solicit or accept from any pharmaceutical manufacturer, a gift of any value. The restrictions in this section shall not include the following items which would otherwise be considered “gifts:”

I. Payment to the sponsor of a significant educational, scientific, or policy-making conference or seminar medical conference; provided, that the payment is not made directly to a health care practitioner and is used solely for bona fide educational purposes, and that the amount and use of the funds is posted on a publicly available Internet site.

II. Reasonable honoraria and payment of the reasonable expenses of a health care practitioner who serves on the faculty at a bona fide significant educational, scientific, or policy-making conference or seminar medical conference; provided, that honoraria for speaking take place with an explicit contract with specific deliverables which are restricted to scientific issues, not marketing efforts.

III. Compensation for the substantial professional or consulting services of a practitioner in connection with a bona fide clinical trial; provided, that the consulting is done under an explicit contract with specific deliverables which are restricted to scientific issues, not marketing efforts.

IV. Publications and educational materials.

126-R:4 Advertising and Marketing Reporting Requirements. A manufacturer or labeler of prescription drugs dispensed in this state that employs, directs or utilizes marketing representatives in this state shall report marketing costs for prescription drugs in this state as provided in this section.

I. By July 1 of each year a manufacturer or labeler of prescription drugs that directly or indirectly distributes prescription drugs for dispensation to residents of this state shall file a report with the department, in the form and manner provided by the department. The report shall be accompanied by payment of a fee, as set by the department, to support the work of the department under this section.

II. The annual report filed under paragraph I shall include the following information as it pertains to marketing activities conducted within this state in a form that provides the value, nature, purpose, and recipient of the expense:

(a) All expenses associated with advertising, marketing, and direct promotion of prescription drugs through radio, television, magazines, newspapers, direct mail, and telephone communications as they pertain to residents of this state, including a reasonable estimate of the value of expenses associated with advertising purchased for a regional or national market that includes advertising within the state. This includes but is not limited to direct and indirect payments: in support of independent or continuing medical education programs, including payments to medical education companies; design, printing and production costs of patient education materials and disease management materials distributed within the state; consulting fees and expenses, participation in speakers’ bureaus, and honoraria or other payments for time while speaking at or attending meetings, lectures, or conferences; writing articles or publications; charitable grants, either directly or earmarked, even if unrestricted; and market research surveys or other activities undertaken in support of developing advertising and/or marketing strategies.

(b) With regard to all persons and entities licensed to provide health care in this state, including health care practitioners and persons employed by them in this state, insurance carriers, health plans and benefits managers, pharmacies, hospitals, nursing facilities, clinics, and other entities licensed in this state to provide health care, the following information:

(1) All expenses associated with educational or informational programs, materials, and seminars and remuneration for promoting or participating in educational or informational sessions, regardless of whether the manufacturer or labeler provides the educational or informational sessions or materials;

(2) All expenses for gifts not otherwise prohibited in RSA 126-R:3, and anything provided to a health care professional for less than market value. The report shall identify recipients by their state board numbers or Drug Enforcement Administration (DEA) numbers;

(3) All expenses associated with product samples, except for samples that will be distributed free of charge to patients; and

(4) The aggregate cost of all employees or contractors of the manufacturer or labeler who directly or indirectly engage in the advertising or promotional activities listed in subparagraphs (1) and (2) including all forms of payment to those employees. The cost reported under this subparagraph shall reflect only that portion of payment to employees or contractors that pertains to activities within this state or to recipients of the advertising or promotional activities who are residents of or are employed in this state.

III. The following marketing expenses are not subject to the requirements of this chapter:

(a) Expenses of $25 or less.

(b) Reasonable compensation and reimbursement for expenses in connection with a bona fide clinical trial of a vaccine, therapy, or treatment.

(c) Scholarships and reimbursement of expenses for attending a significant bona fide educational, scientific, or policy-making conference or seminar of a national, regional, or specialty medical or other professional association if the recipient of the scholarship is chosen by the association sponsoring the conference or seminar.

IV. By January 1, 2009 and every 2 years thereafter, the department shall make a report to the general court and the attorney general, containing an analysis of the data submitted to the department, including the scope of prescription drug marketing activities and expenses and their effect on the cost, utilization, and delivery of health care services and any recommendations with regard to marketing activities of prescription drug manufacturers and labelers.

V. Information submitted to the department pursuant to this chapter is a public record except to the extent that it includes information that is protected by state or federal law as a “trade secret.” Data compiled by the department for the purposes of reporting required by this chapter is a public record, as long as it does not reveal information that is protected by state or federal law as a “trade secret.” Notwithstanding any other provision of law, the identity of health care practitioners and other recipients of gifts, payments, and materials required to be reported in this chapter do not constitute confidential information or “trade secrets” protected under this chapter.

126-R:5 Rulemaking. The commissioner shall adopt rules, pursuant to RSA 541-A, relative to:

I. Format and content of all forms required under this chapter.

II. Procedures for submission of the report required under RSA 126-R:4, I.

III. Fees required under this chapter.

IV. Confidentiality procedures under RSA 126-R:4, V.

126-R:6 Penalty. This chapter may be enforced in a civil action brought by the attorney general. Notwithstanding title LXII, any person who violates this chapter shall be punished by a fine of not more than $5,000 or by imprisonment for not more than 2 years, or both.

2 Effective Date. This act shall take effect July 1, 2009.

LBAO

08-2590

11/30/07

HB 1518-FN - FISCAL NOTE

AN ACT relative to prescription drug marketing, restrictions, and disclosure.

FISCAL IMPACT:

      The Department of Health and Human Services and Department of Justice state this bill may increase state revenue and expenditures, and county expenditures by an indeterminable amount in FY 2010 and each year thereafter. This bill will have no fiscal impact on county and local revenue, or local expenditures.

METHODOLOGY:

    The Department of Health and Human Services states this bill would impose a moratorium on most gifts from pharmaceutical companies to health care providers. The Department states it is not charged with oversight or regulation of pharmaceutical companies and lacks any resources to regulate or oversee such companies. It is not clear from the bill what, if any, of the responsibility of enforcement of the gift moratorium falls on the Department. The proposed bill would also require pharmaceutical companies that do any marketing in New Hampshire to file an annual disclosure with the Department, for which the Department shall charge a fee established in rules. The Department would be required to compile these reports, and reduce them to a single report to be shared with the General Court and the Attorney General every other year. The Department states it is not clear if the intent of the fee is to create a revolving self-generating fund with which to pay for the cost of the review of the reports and creation of the biennial report. Since the Department does not know how many such reports will be filed by pharmaceutical companies in any given year, they are unable to estimate the human resources necessary at this time. The Department states this task would require a highly skilled individual with knowledge of pharmacy and/or health economics, and no such individual currently exists at the Department. It is also unclear what, if any, enforcement mechanism would be employed if a pharmaceutical company failed to file their annual report at the Department. However, the Department states if they were responsible, they would require an indeterminable amount of additional staff. The Department states they currently lack resources with which to recruit, hire, and maintain qualified individuals to carry out these tasks. The Department states it is unable to determine the exact fiscal impact at this time.

    The Department of Justice states violations of the bill would be a felony or may be enforced by a civil action brought by the Attorney General. The Department states the criminal offense created by this bill would typically be prosecuted by a county attorney’s office. The Department states there would be some fiscal impact to the Department in instances when an appeal would be taken to the New Hampshire Supreme Court, but it is difficult to estimate if any of these cases would be appealed. The Administrative Prosecution Unit of the Department would be responsible for prosecuting any professional disciplinary action arising under this bill, however, it is anticipated that the number of such actions could be absorbed within their existing budget. The Department is unable to determine how many civil actions would be generated by the bill.