Contributed By Jones Day
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.
Kamiyacho Prime Place
1-17, Toranomon 4-chome