Contributed By Jones Day
The advertising of medicines in Japan is regulated by both Japanese laws and regulations as well as self-regulatory codes created by trade associations in the pharmaceutical industry. The main law that regulates pharmaceutical advertising is the Pharmaceuticals and Medical Devices Act (Act No 145 of 10 August 1960, as amended) (the 'PMD Act'). The major self-regulatory codes include the codes created by the Japan Pharmaceutical Manufacturers Association (JPMA) and those created by the Japan Self-Medication Industry (JSMI).
Laws and Regulations
In Japan, the Act against Unjustifiable Premiums and Misleading Representations (Act No 47 of 19 May 1997, as amended) (UPMRA) provides some general rules concerning advertising. However, in the case of pharmaceutical advertising, the PMD Act, which is the main law that regulates drugs, has several special articles that regulate pharmaceutical advertisements. More specifically, Articles 66, 67 and 68 of the PMD Act provide for the
As for the prohibition of advertisements for unauthorised drugs, the PMD Act states that no person shall advertise the name, manufacturing process, indications or performance of a drug before obtaining the necessary marketing authorisation from the Japanese government.
As for the prohibition of false or exaggerated advertisements, the PMD Act states that no person shall, explicitly or implicitly, advertise, describe or circulate the name, manufacturing process, indications or performance of a drug using false or exaggerated statements.
As for the prohibition of advertisements endorsed by a doctor, the PMD Act states that the advertisement, description or circulation of statements giving the false impression of an endorsement by a medical doctor or other person of the efficacy or performance of a drug shall be prohibited.
As for the prohibition of obscene statements or diagrams, the PMD Act states that no person shall use obscene statements or diagrams or those suggesting illegal abortions in connection with the advertisement of drugs.
Finally, as for the regulation of advertisements for drugs for designated diseases, the PMD Act states that no person shall advertise to the general public drugs intended for use in the cure of cancer, sarcoma or leukaemia, and that are likely to be highly dangerous if used without the direction of medical doctors or dentists.
The Ministry of Health, Labour and Welfare (MHLW) is the competent governmental authority with regard to medicines in Japan and has promulgated the PMD Act Enforcement Ordinance, the PMD Act Enforcement Regulations and various other notices for the enforcement of the PMD Act. One among these is the 'Standards for Appropriate Advertising concerning Medical Goods' (Notification No 0929-4 of the Pharmaceutical Safety and Environmental Health Bureau of 29 September 2017) (the 'Standards'), which were issued by the MHLW in the form of an official notice and which have as their central function the regulation of pharmaceutical advertising.
The Standards provide the standards of conduct that must be adhered to by any person or entity when advertising drugs; their purpose is to prevent companies from giving a false impression of drugs to the general public and to prevent drug abuse and the deterioration of drug reliability. The Standards consist of two parts: The first part relates to the interpretation of 'False or Exaggerated Advertisements', under Article 66 (1) of the PMD Act and the second part goes to the purpose of the Standards themselves (preventing false impressions, drug abuse and the deterioration of drug reliability).
The first part of the Standards sets forth specific rules regarding:
The second part of the Standards prescribes the rules or restrictions regarding:
In order to prevent dissemination of inappropriate information during the course of promotion activities, the MHLW issued its new 'Guidelines Concerning Detailing Activities of Ethical Drugs' (the 'Detailing Guidelines') on 25 September 2018. The Detailing Guidelines include
The Detailing Guidelines will take effect on 1 April 2019, although the provisions related to company responsibilities will not take effect until 1 October 2019.
The MHLW issued a paper regarding possible amendments to the PMD Act on 25 December 2018. This paper outlines the potential reforms, some of which relate to pharmaceuticals advertisement. More specifically, the paper proposes introducing administrative fines for violations of the regulations on advertisements under the PMD Act and authorising regulators to order pharmaceutical companies to correct improper advertisements. The bill concerning these amendments has not yet been prepared but is expected to be submitted to the Japanese Diet in 2019.
With regard to prescription-only medicines, a trade association of leading Japanese pharmaceutical research companies issues the major self-regulatory codes. In particular, the JPMA Code of Practice (the 'JPMA Code') is the main regulatory code that regulates pharmaceutical advertisements. The JPMA Code has two chapters. The first chapter is the Code of Practice (the 'JPMA Code of Practice') and the second chapter is the Promotion Code (the 'JPMA Promotion Code'). This code establishes the rules that all member companies must comply with when promoting prescription-only medicines. The JPMA Code provides, more than the Standards, detailed and strict rules for prescription-only medicines, such as the standards for activities of medical representatives, promotional materials, drug samples and scientific meetings.
The JPMA has also issued several additional guidelines relating to pharmaceutical promotion. For example, among these are the Guidelines for the Drafting of Prescription Pharmaceutical Products Informational Material (the 'JPMA Drafting Guidelines'), discussed below in Section 5.
With regard to advertising over-the-counter (OTC) medicines, the Japan Self-Medication Industry (JSMI), a trade association of Japanese over-the-counter manufacturers, issued the Guidelines for Proper Advertising of Over-the-Counter Medicines (the 'OTC Guidelines'). The OTC Guidelines apply to the advertising of non-prescription drugs to the general public. In particular, the OTC Guidelines regulate advertising through newspapers, magazines, television, radio, websites and other forms of mainstream media to ensure the appropriateness of publicity and advertising activities of non-prescription drugs.
A self-regulatory code will apply to the member companies of the particular trade association that created the code. For example, the codes created by the JPMA apply only to pharmaceutical companies that are JPMA member companies.
Conduct that violates self-regulatory codes does not necessarily violate Japanese laws and regulations; such conduct is only illegal if it independently violates Japanese laws and regulations. However, a violator may face sanctions under the self-regulatory codes, potentially damaging its reputation.
Notice No 148 dated 29 September 1998, issued by the Pharmaceutical Safety Bureau of the MHLW, defines 'advertising' for the purposes of the PMD Act. This notice states that 'advertising' has all of the following three characteristics:
Difference Between Advertising and Other Information
Advertising and other information are distinguished by the above definition of 'advertising'. First, advertising must be clearly intended to induce customers to make purchases. This requirement might be satisfied, for example, by an advertisement that lists a phone number to call to buy certain goods, suggesting a clear intention to induce customers to make purchases. However, it is not likely that a book in a medical library describing certain drugs and targeted at researchers would have such an intention.
As to the second requirement – the clear expression of product names – it may be met even in cases where particular product names are not mentioned; this would be the case if the general public could recognise particular medicines based on the pictures or descriptions of those medicines shown in the advertisement.
Finally, the third requirement (the ability to be seen by the general public) would not be likely to be satisfied if the relevant information is only provided to patients in a hospital, since the narrow scope of its distribution would limit the potential for the information to reach the general public.
As long as disease-awareness campaigns are meant to inform the public in a general way about certain diseases and do not name specific medicines, they are not considered 'advertising' under the PMD Act. However, if the content of a disease-awareness campaign satisfies the three parts of the definition of advertising set out above, that disease awareness campaign will be subject to the advertising regulations under the PMD Act and the Standards.
The risk that a disease-awareness campaign is considered advertising prohibited under the PMD Act is high in the case of a disease-awareness campaign publicising prescription-only medicines to the general public, because the advertising of prescription-only medicines to the general public is prohibited under the PMD Act. In this regard, the JPMA Code of Practice suggests that the content of disease education activities targeting ordinary citizens and patients be closely inspected from the planning stages so that they will not be considered prohibited advertising.
Press releases regarding medicines are not prohibited. However, if a press release satisfies the three parts of the definition of advertising mentioned above, both the regulations concerning advertising under the PMD Act and the Standards will apply.
Generally, the restrictions under the PMD Act are more stringent when the target audience is the general public than when the target audience is healthcare professionals. For example, advertisements for pharmaceutical products used for cancer, sarcoma or leukaemia aimed at the general public are prohibited under Article 67 of the PMD Act.
In this regard, the JPMA Code of Practice states that pharmaceutical companies must ensure that their activities do not become inappropriate promotional activities for their own commercial purposes. It further states that pharmaceutical companies should take steps to avoid their activities becoming advertisements for ethical drugs to the general public or advertising that recommends unapproved drugs or off-label uses.
Comparative advertising for medicines is not prohibited but it is restricted by Japanese law and self-regulatory codes. The major restrictions are as follows:
According to the Commentary of Article 9 of the Standards, a pharmaceutical company’s comparative advertising must only feature its own products and the advertising must specify the name of those products. Comparisons with competitors’ products are prohibited. In addition, when a pharmaceutical company compares two of its own products, the company must ensure that it provides a sufficient explanation of the products.
Further, the JPMA Promotion Code stipulates that comparative advertising “shall be based on scientific data and, in principle, shall be made using generic names.”
Finally, the Consumer Affairs Agency has issued general guidelines for comparative advertising. These guidelines provide that a comparative advertisement shall be considered a Misleading Representation prohibited under the UPMRA if:
If providing information on unauthorised medicines or unauthorised indications is considered advertising under the PMD Act, such provision of information is prohibited. Article 68 of the PMD Act expressly prohibits advertising unauthorised medicines or unauthorised indications. The JPMA Promotion Code provides that member companies must provide information such as indications, dosage and administration, which should not deviate from the approved items for the drugs.
However, if providing information on unauthorised medicines or unauthorised indications falls outside the definition of advertising under the PMD Act, such provision of information may be allowed. In this regard, the Commentary of the JPMA Promotion Code lists several cases in which the provision of information is permitted, where the information provision is for the purpose of medical/pharmaceutical experts’, as well as the general public’s, right to know about scientific/medical advancements. These cases include:
Moreover, the Commentary notes that, even if the activity consists of providing information as permitted above, the company must take special care not to be involved in inappropriate promotional activities for its own commercial purposes.
Once they take effect, the new Detailing Guidelines will require pharmaceutical companies to comply with the following conditions for providing information on unauthorised medicines and unauthorised indications:
The aforementioned Commentary of the JPMA Promotion Code lists two cases in which providing information on unauthorised medicines or unauthorised indications during a scientific conference directed at healthcare professionals is allowed.
The first case is the presentation of clinical research results during a scientific meeting. However, seminars sponsored by pharmaceutical companies are not covered by this exception.
The second case is the display, by a pharmaceutical company, of educational samples of an unapproved medicine at an exhibition during an international scientific meeting. This only applies, however, when such an unapproved medicine has been approved in at least one other country. If no countries have approved the product, the company may not display a sample of the product. In addition, the pharmaceutical company may not distribute samples of unapproved medicines and related scientific materials to anyone during the meeting.
As mentioned in 3.1 Restrictions on Provision of Information on Unauthorised Medicines or Indications, the new Detailing Guidelines provide certain conditions on providing information on unauthorised medicines or unauthorised indication.
The Commentary of the JPMA Promotion Code allows the supply, by a pharmaceutical company, of peer-reviewed scientific journal articles, such as reprints of medical journals, upon the request of a medical doctor. However, companies shall not proactively induce a medical doctor to request such scientific journal articles.
As mentioned in 3.1 Restrictions on Provision of Information on Unauthorised Medicines or Indications, the new Detailing Guidelines provide certain conditions on providing information on unauthorised medicines or unauthorised indication.
There are no Japanese laws or self-regulatory codes that expressly regulate the sending of information on unauthorised medicines or indications to healthcare institutions to enable them to prepare budgets. Given that there are no laws or self-regulatory codes that permit such transmission of information, there remains a risk that such conduct would be considered a “promotional activity on unauthorised medicines or unauthorised indications,” which is prohibited under Article 68 of the PMD Act.
Advertising Prescription-only Medicines
Advertising prescription-only medicines to the general public is prohibited in Japan. Article 5 (1) of the Standards expressly prohibits such advertising. In addition, Article 67 (1) of the PMD Act prohibits advertising drugs for specified diseases and regenerative medicines to the general public.
Advertising Over-the-counter Medicines
Advertising OTC medicines to the general public is not prohibited but is restricted by the PMD Act and the Standards, as well as by self-regulatory codes.
Advertising for OTC medicines is subject to the rules concerning advertising under the PMD Act and the Standards, which are described above in Section 1. In this regard, it should be noted that Article 6 of the Standards stipulates a particular restriction on advertisements to the general public concerning the efficacy of drugs for diseases, which cannot be expected to be cured without a doctor’s or dentist’s diagnosis or treatment. This Article provides that such advertisements must not suggest that the diseases can be cured without such a diagnosis or treatment when the advertisements are targeted at the general public.
In addition, the OTC Guidelines regulate advertising through newspapers, magazines, television, radio, websites and other forms of mainstream media to ensure the appropriateness of the publicity and advertising activities for non-prescription drugs.
There is no law or regulation that provides exactly which information must be included in pharmaceutical advertising aimed at the general public.
However, under the PMD Act and the Standards, if advertising contains information as to the names of the products, their manufacturing process or their indication, dosage, administration or safety, the advertising must follow the following rules.
As for the names of the products that require marketing authorisation under the PMD Act ('Authorised Products'), Article 1 of the Standards provides that companies shall use only authorised brand names or the generic names of the relevant products.
The Standards also allow the two types of names above or names listed on the Japanese Pharmacopeia to be used for products that do not require marketing authorisation ('Non-Authorised Products'). However, the brand names of Non-Authorised Products must not contradict the actual manufacturing method, efficacy or safety of the products.
As for the manufacturing process, Article 2 of the Standards provides that companies shall not express the manufacturing process of the product as being different from the product’s actual manufacturing process or the manufacturing process, which may lead the general public mistakenly to believe in the superiority of the product.
As for indication, dosage, administration and safety, Authorised Products, Article 3 (1) and (4) of the Standards prohibit companies from using expressions for Authorised Products, which are beyond the scope of or deviate from the authorised indication, dosage, administration or safety of the products (ie “off-label promotion”).
As for Non-Authorised Products, Article 3 (2) and (4) of the Standards provide that companies shall not use expressions beyond the scope of the product’s efficacy, dosage, administration or safety as generally recognised in the field of medicine or pharmacy.
In addition to the above, the Standards include several other relevant rules, including prohibitions on certain claims relating to efficacy or safety of products and prohibitions on slander and/or defamation of competitors’ products.
Beyond the question of which information to include, the OTC Guidelines identify specific statements that must or may not be used in advertisements for each category of OTC medicines. For instance, advertisements for cold medicines must use the phrase “relief of cold symptoms” but not “this will not make a patient sleepy.” Also, advertisements for cold medicines on television or through streaming video on the internet must display the statement “this product shall be used after receiving an explanation from a pharmacist and after carefully reading the warning label” for a second or more with clear and distinct characters.
As for the price of the medicine, this information can be mentioned in advertising aimed at the general public, although doing so is not required by either laws or self-regulatory codes.
There are no laws or regulations that expressly impose restrictions on interactions between patients or patient organisations and industry.
As for the main self-regulatory codes, the JPMA Code of Practice sets forth the rules concerning collaboration with patient groups. First, when a pharmaceutical company has any relationships or collaboration with patient institutions, the company must respect the independence of the institutions and the company’s activities must meet a high ethical standard. Further, the company must make an effort to promote sufficient mutual understanding with patient groups regarding the purpose and scope of the collaboration.
Second, the fact of the sponsorship itself is required to be disclosed. Further, the purpose and scope of the sponsorship shall be agreed upon between both parties and shall be made in writing and recorded in order to ensure transparency. Finally, the member companies that are collaborating with patient organisations shall establish internal company guidelines based on the 'Guideline on Collaboration with Patient Organisations' issued by the JPMA.
Article 66 (2) of the PMD Act provides that advising, describing or circulating statements that lead to the false impression that a physician or other person has certified the indications or properties of drugs will be construed as false or exaggerated advertising, which is prohibited under Article 66 (1) of the PMD Act. In addition, Article 10 of the Standards explicitly prohibits endorsements by healthcare professionals in advertisements for medicines. This is because such advertising may give the erroneous impression that opinion leaders or other such individuals recommend or guarantee the medicines being advertised.
There is no national law or regulation that explicitly provides which information must be included in pharmaceutical advertising directed at healthcare professionals.
However, if such advertising contains information relating to the names of the products, the manufacturing process and the indication, dosage, administration or safety of or in relation to the drugs, as well as other relevant items, the advertising shall be subject to the Standards, as described above in 4.2.
As for self-regulatory codes, the JPMA Drafting Guidelines provides that advertising directed at healthcare professionals must contain the following information in principle:
Even if an advertisement is intended to promote only the name of a product, statements made in the advertisement shall contain at least the brand name, therapeutic category, regulatory classification, generic name and presence on the NHI reimbursement price list.
Beyond the question of which information to include, the JPMA Promotion Code identifies specific statements that may or may not be used in advertisements to healthcare professionals. For example, it prohibits stating that “there are few adverse reactions” without also citing the conditions of use or without providing a summary of relevant data, including the relevant adverse reactions, to back up such a safety claim. The JPMA Promotion Code also attempts to promote the quality and clarity of the information being presented. For example, the advertising materials must not only emphasise the efficacy of the product but must also include product safety information, including adverse reactions, in order to create a fair and balanced statement of the advertising. Further, the contact and address for seeking more information on the product must be described clearly.
As for the price of the medicine, the advertising must mention whether or not the medicine is registered on the NHI reimbursement price list, rather than the price itself.
Pharmaceutical advertising may refer to data on file or other clinical studies not included in the Summary of Product Characteristics (SmPC). However, references to data on file or clinical studies are limited in certain ways by law and by self-regulatory codes.
First, the general rules on advertising (such as prohibition of false or exaggerated advertisements and advertising that recommends unapproved drugs or off-label uses) under the PMD Act will apply.
Second, references to data on file or other clinical studies shall be subject to the specific regulations provided by the JPMA Drafting Guidelines. For example, statements shall only concern indications approved in Japan. In addition, the study must be published in a peer-reviewed journal.
Pharmaceutical companies may provide reprints of journal articles to healthcare professionals, subject to the conditions set forth in both laws and regulations and self-regulatory codes. Major restrictions on reprints are as follows:
In Japan, advertisements for medicines do not require prior authorisation from, nor notification to, any regulator.
There are no laws or regulations currently in effect that require companies to make particular arrangements for ensuring compliance with the pharmaceutical advertising rules – or to adopt certain procedures or hire specific personnel. However, the new Detailing Guidelines require that companies establish internal systems to ensure appropriate conduct with respect to promotion activities. This includes establishing an independent department responsible for monitoring promotional materials and promotion activities, as well as a supervisory review board to advise the monitoring department.
Currently, the JPMA Promotion Code requires that JPMA member companies establish internal systems to comply with relevant laws, regulations and industry self-regulations, appoint a promotional material officer and establish an in-house oversight system so that only reviewed promotional materials and advertisements are used. The promotional material officer must have a deep enough understanding of medical and pharmaceutical practice and must have an appropriate educational background; he or she shall be responsible for the management of advertising and promotional materials such as product information brochures. A senior management officer may become a management representative if qualified professionals in the medical advisory division can support and advise the officer.
Generally, the same laws, regulations and self-regulatory codes concerning pharmaceutical advertising will also apply to advertising on the internet for medical products. In addition, the Commentary to the JPMA Promotion Code provides specific rules concerning access restrictions on internet-accessible information related to prescription-only medicines.
As advertising prescription-only medicines to the general public is prohibited under the Standards, when a pharmaceutical company provides healthcare professionals with product-related information concerning prescription-only medicines through the internet, the company must restrict access to the relevant websites so that only healthcare professionals have access to such information.
The question, therefore, is what is considered a sufficient access restriction. In this regard, the Commentary provides the conditions set forth below; if all these conditions are satisfied, then an access restriction will be considered sufficient:
As long as a pharmaceutical company uses a sufficient access restriction, it is not required to use any particular method of establishing passwords.
Generally, the same laws, regulations and self-regulatory codes concerning pharmaceutical advertising will also apply to pharmaceutical advertising on social media. The JPMA Code of Practice in particular describes several issues to which pharmaceutical companies must pay close attention when advertising through social media.
The JPMA Code of Practice defines 'social media' as media formed by interactive communication mainly through the internet, where the users, including individuals, send various information. The main feature of social media is that an individual can easily and promptly send information to the general public. Due to this characteristic of the medium, inappropriate information, including false information, may be broadly transmitted to the general public without any confirmation of the accuracy of the information. Therefore, the JPMA Code of Practice requires member companies to take all responsibility for such social media content and before advertising on social media the companies must confirm that all relevant subsidiaries, parent companies, affiliates, planning companies, agencies, employees, etc, comply with the JPMA Code.
Further, the JPMA Code of Practice requires that member companies pay special attention to the following:
As mentioned in 7.1 Regulation of Advertising of Medical Products on the Internet, pharmaceutical companies must include access restrictions on websites containing advertising, or other information intended for healthcare professionals, since advertising prescription-only medicines to the general public is prohibited.
General anti-bribery rules that apply to the interactions between pharmaceutical companies and healthcare professionals or organisations are provided in the Penal Code (Act No 45 of 24 April 1907, as amended). In addition, pharmaceutical companies are expected to comply with the National Public Service Ethics Code (the 'Ethics Code'). Further, the Unfair Competition Prevention Act (Act No 47 of 19 May 1993, as amended) (UCPA) provides rules regarding bribery to foreign officials. These regulations apply only to benefits provided to recipients who are individuals (eg, public officers).
Article 198 of the Penal Code is the basic anti-bribery regulation that directly applies to officers or employees of pharmaceutical companies. Article 198 provides that any person who gives, offers or promises to give a bribe to a public official shall be punished by imprisonment with labour for not more than three years or a fine of not more than JPY2.5 million.
Bribery under the Penal Code is broadly defined. It covers not only money or goods but also any benefit (material or immaterial) sufficient to satisfy a person’s desires. “Public Official” is also broadly defined. The term includes not only national or local government officials but also individuals deemed government officials under special laws.
National Public Service Ethics Code
The Ethics Code is a code established by the Cabinet based on the National Public Service Act for the purpose of maintaining the integrity of, and citizens’ trust in, public service. The Ethics Code prohibits national public officials from receiving money or goods from interested parties. In some situations, pharmaceutical companies can be considered such 'interested parties'. The Ethics Code provides for some exemptions, including, among others:
Unfair Competition Prevention Act
Article 18 (1) of the UCPA prohibits any person from giving, offering or promising to give any benefit to a foreign public official to have that foreign public official act or refrain from acting in relation to the performance of his or her official duties, in order to make any illicit gains in business with regard to an international commercial transaction. An employee of a pharmaceutical company who violated Article 18 would face imprisonment with labour for up to five years and/or a fine of up to JPY5 million. Further, the pharmaceutical company itself may also be subject to a fine of up to JPY300 million.
The UPMRA and the Fair Competition Code concerning Restriction on Premium Offers in the Ethical Pharmaceutical Drugs Marketing Industry (the Fair Competition Code) regulate offering benefits or other inducements to prescribe to healthcare professionals or organisations. The JPMA Promotion Code contains similar rules. These regulations apply to benefits provided both to individuals and organisations.
Article 4 of the UPMRA allows the Prime Minister to restrict the offering of premiums in various ways, including through a prohibition. Under Article 6 (2) of the UPMRA, the Cabinet issued a public notice: 'Restrictions on the Offering of Premiums in the Ethical Pharmaceutical Drugs, Medical Devices and Sanitation Inspection Industries'. The notice prohibits pharmaceutical companies from offering articles, services or other premiums to healthcare institutions as a means of inducing unjust transactions beyond what is commercially reasonable for the usage or sanitary inspection of ethical pharmaceutical drugs.
Fair Competition Code
'Fair competition codes' are self-regulatory codes set up by the business associations of specific industries based on the UPMRA restrictions on the provision of premiums. Generally, fair competition codes will include UPMRA rules as well as supplemental rules not provided under the UPMRA depending on the nature of the products and transactions in the relevant industry. The pharmaceutical industry established the Fair Competition Code, which pharmaceutical companies are currently complying with.
The Fair Competition Code provides that pharmaceutical companies shall not offer premiums to healthcare professionals or institutions as a means of unjustifiably inducing drug transactions. If, however, based on standard commercial practices the offers of economic benefits are considered to be discounts, after-sale services or benefits in connection with the drugs, they are no longer categorised as offers of premiums. In addition, even if money, goods or economic benefits are considered premiums, there are some cases in which offering premiums is permitted (several examples are listed). In addition, if premiums are 'small sum offerings', offering them will not violate the Fair Competition Code.
The JPMA Promotion Code
The JPMA Promotion Code has several provisions regarding offering benefits to healthcare professionals or institutions. It regulates, among other issues:
The Fair Competition Code and the JPMA Promotion Code regulate offering gifts to healthcare professionals.
The Fair Competition Code lists several examples of permitted gift giving activities, including the following:
The JPMA Promotion Code prohibits member companies from offering healthcare professionals and medical institutions, among other entities, any goods that could potentially negatively affect the appropriate use of drugs or damage drug credibility.
The Fair Competition Code and the JPMA Promotion Code impose limitations on providing samples to healthcare professionals.
The Enforcement Rules and the Operating Standards of the Fair Competition Code provide the basic rules for offering samples of drugs. In the case of product samples for reference the following rules apply:
Similar rules apply to the provision of clinical drug samples.
The JPMA Promotion Code states that member companies must provide only the minimum amount of samples and must also provide the relevant drug information.
Pharmaceutical companies are allowed to sponsor scientific meetings or congresses and/or attendance by healthcare professionals to these events, but only in a limited capacity and in strict compliance with the Fair Competition Code and the JPMA Promotion Code.
With regard to a seminar for healthcare professionals concerning a pharmaceutical company’s own drugs, the company can provide non-extravagant articles or services and can bear some related expenses. For example, companies may provide tea and snacks or lunch boxes, hold small social gatherings, cover transportation and accommodation expenses and compensate the lecturer. The seminar should be held in an appropriate place in light of its –purposes it would be sensible to avoid a resort, a place for sightseeing or a location overseas for this reason (the JPMA Promotion Code expressly provides that pharmaceutical companies shall, in principle, hold such seminars in Japan). Even if such seminars are permitted to take place abroad, the payment of travel expenses must be limited to the travel expenses of healthcare professionals who will provide information on the company’s drugs to all participants. Where a pharmaceutical company hosts a seminar unrelated to its own drugs, only meeting expenses may be paid.
The rules under the Fair Competition Code set forth the types of entertainment/hospitality that pharmaceutical companies may or may not provide to healthcare professionals. By way of example, providing the sort of entertainment such as karaoke or golf is prohibited.
Pharmaceutical companies may provide grants or donations to healthcare professionals or healthcare institutions subject to the restrictions under the Fair Competition Code and the JPMA Promotion Code.
Under the Fair Competition Code, pharmaceutical companies may not provide donations to healthcare professionals or healthcare institutions as a means of unjustly inducing drug transactions. The question of whether the donations have such a purpose is decided based on detailed criteria provided in the Operating Standards of the Fair Competition Code. Some examples are discussed below.
With regard to monetary donations, according to the Operating Standards criteria, pharmaceutical companies may make monetary donations to healthcare institutions within the bounds of standard commercial practice; such donations would not be considered a means of unjustly inducing drug transactions.
With regard to non-monetary donations, the Operating Standards criteria state that pharmaceutical companies may voluntarily provide their own drugs to healthcare institutions in the case of a disaster and to the medical faculty of universities as long as doing so meaningfully contributes to the students’ lessons.
Under the JPMA Promotion Code, pharmaceutical companies shall not provide donations to healthcare professionals or healthcare institutions which may influence the appropriate use of drugs.
In practice, pharmaceutical companies in Japan usually sell their drugs to wholesalers, who in turn sell the drugs to healthcare institutions. Thus, since pharmaceutical companies do not tend to sell directly to healthcare institutions, any rebates or discounts would mostly be provided to wholesalers rather than healthcare institutions. As to such rebates or discounts provided to wholesalers, the Anti-monopoly Act (Act No 54 of 14 April 1947, as amended) may prohibit certain conduct such as adjusting the discount or rebate amount in exchange for the wholesaler agreeing to follow a suggested price.
Under the Fair Competition Code, pharmaceutical companies may offer remuneration or expenses for research or certain studies. Also permitted are expenses for post-marketing surveillance for prescription-only medicines, as well as advertising fees for advertising drugs in journals. Such payments must meet the criteria provided in the Enforcement Rules and the Operating Standards of the Fair Competition Code. For instance, remuneration must be appropriate in light of the content of the relevant research.
The JPMA Promotion Code requires that any remuneration must be appropriate in relation to the services provided. Pharmaceutical companies must not pay healthcare professionals to provide consulting services only as a way of covertly providing them prohibited monetary benefits.
No prior regulatory authorisations or notifications are required for the activities described in this section.
With regard to employer consent, some pharmaceutical companies have internal company rules which regulate providing gifts, hospitality, donations or other payments/services to healthcare professionals and institutions. Such internal rules may require obtaining prior consent from or notification to the companies’ compliance divisions.
The Clinical Research Act
The Clinical Research Act (Act No 16 of 14 April 2017), which took effect on 1 April 2018, requires that pharmaceutical companies and their subsidiaries disclose certain transfers of value to healthcare professionals and institutions in connection with specified clinical research. Clinical research includes human trials examining the efficacy or safety of pharmaceuticals but would not include a clinical trial for new drug conducted under the PMD Act.
Specified clinical research is defined as clinical research funded by pharmaceutical companies, clinical research on unapproved drugs or clinical research concerning off-label use of a drug.
Transfers of value which must be disclosed under the Clinical Research Act include research funds for specified clinical research, donations provided during the term of or within two years after specified clinical research, and fees for writing, lectures or other services provided during the term of and within two years after specified clinical research. The recipients of payments covered by the regulation include healthcare providers involved in specified clinical research, healthcare institutions or other organisations to which a principal investigator belongs, and organisations managing the specified clinical research. The transfers of value for specified clinical research made in each fiscal year shall be disclosed the following fiscal year on the company’s website.
The JPMA Transparency Guideline
The JPMA 'Transparency Guideline for the Relation between Corporate Activities and Medical Institutions' (the 'Transparency Guideline') requires that JPMA member companies disclose certain information regarding transfers of value made to healthcare professionals or healthcare institutions.
The Transparency Guideline further requires that each member company create its own internal 'transparency policy' based on the Transparency Guideline. Therefore, each JPMA member company has established its own internal transparency policy and has been disclosing information on transfers of value it has made to healthcare institutions based on this internal policy.
The Transparency Guideline creates five different categories of transfers of value (fees or expenses). For each category the relevant fees or expenses must be disclosed in detail. The five categories are:
The types of transfers of value to be disclosed include not only cash but also medicines, medical devices and other goods. Value transferred through a third party, such as a subcontractor or foundation, must be disclosed as well.
The recipients of payments covered by the Transparency Guideline are healthcare institutions (such as hospitals and pharmacies), research institutes (such as medical and pharmaceutical departments of universities), healthcare associations (such as medical associations and pharmacists’ associations) and persons engaged in medical care and nursing care (such as doctors and nurses) and medical personnel (such as life-science researchers). The transfers of value made in each fiscal year shall be disclosed in the following fiscal year through the company’s website.
As the transparency requirements under the Clinical Trial Act would apply only to the marketing authorisation holder and its subsidiaries, the requirements would not apply to foreign companies or companies that do not sell products on the market in Japan.
The transparency requirements under trade association rules such as the above-mentioned Transparency Guideline only bind members of such trade associations. Accordingly, the transparency requirements under the self-regulatory rules will not apply to foreign companies and/or companies that do not yet have products on the market, unless such companies are members of trade associations with transparency requirements.
Each Japanese law has one or more government agencies that are responsible for enforcement (ie, the regulatory authority). With regard to the PMD Act, as well as the Standards, the MHLW and the competent prefectural governor are the regulatory authorities. In the case of the UPMRA, the Prime Minister, the Consumer Affairs Agency, the Japan Fair Trade Commission and the competent prefectural governor are the regulatory authorities.
The main role of courts in administrative law enforcement (including for the PMD Act) is to impose criminal penalties on companies and their employees that violate the law. In the case of a serious violation, the regulatory authority will ask the Public Prosecutor’s Office to prosecute the company or its employee, and the Public Prosecutor’s Office will file charges against the company. The court will then render a final judgement.
With regard to the enforcement of self-regulatory codes, the codes usually establish an organ that is in charge of enforcing the code. In the case of the JPMA Promotion Code, the JPMA Code Compliance Committee is responsible for enforcement. As for the Fair Competition Code, the Fair Trade Council of the Ethical Pharmaceutical Drug Marketing Industry (the 'Fair Trade Council'), which consists of the pharmaceutical companies designated by the code, is responsible for the code’s enforcement.
In Japan, pharmaceutical companies may initiate civil litigation proceedings against their competitors before courts for certain types of advertising infringements based on the UCPA.
Under the UCPA, a company whose business interests have been infringed or are likely to be infringed by a competitor’s
The company may also claim damages to its business interests resulting from intentional or negligent infringement related to the above conduct.
For example, a pharmaceutical company may file a lawsuit in Japanese court seeking an injunction and/or compensation of damages against a competitor if the competitor creates an advertisement containing falsehoods or slander regarding the pharmaceutical company’s products.
Penalties or Measures Imposed by Regulators
In practice, Japanese regulatory authorities, such as the MHLW or the Prime Minister, will be likely to issue an administrative guidance against a pharmaceutical company to remedy the illegal conduct – if the company does not follow such guidance, the authority will issue an administrative disposition.
For example, under the PMD Act the MHLW or the competent prefectural governor may take the following administrative dispositions, among others:
A company that has had its manufacturing and/or marketing licence withdrawn has the right to appeal such a disposition above under the Administrative Appeal Act (Act No 160 of 15 September 1962, as amended).
The JPMA Code Compliance Committee may take actions against pharmaceutical companies that violate the JPMA Promotion Code to address the companies’ violations in accordance with the ,Rules of Actions against the Breach of the Promotion Code'. Actions the aforementioned committee may take include, among others, serious warning, suspension of membership or expulsion from the JPMA.
The Fair Trade Council may order companies violating the Fair Competition Code to take certain measures. If the violator does not comply with such an order, the council may impose a penalty, including a fine of up to JPY1 million or expulsion from the council. The council may also request the Consumer Affairs Agency to take necessary actions.
Penalties Imposed by Courts
Courts may impose criminal penalties on pharmaceutical companies and/or on their officers and employees who violate the relevant laws. The major criminal sanctions for the violation of pharmaceutical advertising rules and rules on inducements to prescribe are as follows:
While only individuals are subject to criminal sanctions under the Penal Code, both individuals and companies may be subject to criminal sanctions under the PMD Act, the UPMRA and the UCPA (PMD Act Article 90 (ii), UPMRA Article 38 (1) and UCPA Article 22 (1) (iii)).
The procedures before and measures taken by the self-regulatory authority and the courts are conducted separately and independently.
The MHLW is strengthening its enforcement activities in relation to pharmaceutical advertising. In 2016, it began monitoring advertising in order to identify violations early and encourage voluntary measures on behalf of the pharmaceutical companies and trade associations. This endeavour included an anonymous healthcare institution appointed by the MHLW to identify problematic items in advertisements and promotional information provided by the pharmaceutical companies, including on their websites or in specialist journals. As a result of the monitoring activities, the MHLW found 52 cases, including 67 problematic items in 2017. Partly in response to these issues, the MHLW issued the Detailing Guidelines in 2018.
Kamiyacho Prime Place
1-17, Toranomon 4-chome