Com­pli­ance in healthcare

The deve­lo­p­ment, manu­fac­tu­re and dis­tri­bu­ti­on of medi­cal devices pose par­ti­cu­lar chal­lenges for manu­fac­tu­r­ers and dis­tri­bu­tors, and medi­cal pro­fes­sio­nals face chal­lenges when it comes to ope­ra­ting them. It is gene­ral­ly indis­pensable for manu­fac­tu­r­ers and dis­tri­bu­tors of medi­cal devices to work tog­e­ther with medi­cal insti­tu­ti­ons and medi­cal pro­fes­sio­nals. Howe­ver, sta­tu­to­ry pro­vi­si­ons of cri­mi­nal law, medi­cal adver­ti­sing law and com­pe­ti­ti­on law must be hee­ded in this regard. This rai­ses the ques­ti­on as to the requi­re­ments which manu­fac­tu­r­ers and dis­tri­bu­tors of medi­cal devices have to keep in mind in their dealings and com­mu­ni­ca­ti­ons with medi­cal professionals.

Medi­cal Device Com­pli­ance Code

The Ger­man Medi­cal Tech­no­lo­gy Asso­cia­ti­on (BVMed) has crea­ted a medi­cal device com­pli­ance code (only in Ger­man) in order to faci­li­ta­te col­la­bo­ra­ti­on bet­ween manu­fac­tu­r­ers and dis­tri­bu­tors of medi­cal devices, on the one hand, and medi­cal pro­fes­sio­nals on the other, with regard to the sta­tu­to­ry con­di­ti­ons. A key object of this code is to keep health care mar­ket ope­ra­tors from coming under sus­pi­ci­on of corruption.

1.     Basic prin­ci­ples of the code

Under the prin­ci­ple of sepa­ra­ti­on, paid or unpaid bene­fits pro­vi­ded to medi­cal pro­fes­sio­nals or employees of medi­cal insti­tu­ti­ons, such as gifts and bene­fits in kind, may not have any rela­ti­onship to the insti­tu­ti­on’s busi­ness tran­sac­tions and may not affect its purcha­sing decis­i­ons. Con­fer­ring bene­fits for pri­va­te pur­po­ses is pro­hi­bi­ted. Under the prin­ci­ple of trans­pa­ren­cy, medi­cal pro­fes­sio­nals and employees of medi­cal insti­tu­ti­ons are requi­red to obtain writ­ten aut­ho­riza­ti­on from the manage­ment of their medi­cal insti­tu­ti­on befo­re ente­ring into ser­vice rela­ti­onships with manu­fac­tu­r­ers or dis­tri­bu­tors of medi­cal devices, inso­far as tho­se ser­vices rela­te to their offi­ci­al duties. This pro­ce­du­re is also recom­men­ded for other arran­ge­ments bet­ween medi­cal pro­fes­sio­nals and manu­fac­tu­r­ers or dis­tri­bu­tors of medi­cal devices. Ser­vice rela­ti­onships bet­ween manu­fac­tu­r­ers or dis­tri­bu­tors of medi­cal devices and medi­cal pro­fes­sio­nals or employees of medi­cal insti­tu­ti­ons should also be docu­men­ted in wri­ting (prin­ci­ple of docu­men­ta­ti­on). And in accordance with the prin­ci­ple of equi­va­lence, com­pen­sa­ti­on should be in reasonable pro­por­ti­on to the ser­vices rendered.

2.    Impact of the code

Gifts and bene­fits in kind to medi­cal pro­fes­sio­nals are gene­ral­ly pro­hi­bi­ted. An excep­ti­on only appli­es for pro­mo­tio­nal gifts of litt­le value which include a per­ma­nent and visi­ble iden­ti­fi­ca­ti­on of the manu­fac­tu­rer or device, as well as “soci­al­ly ade­qua­te” gifts on spe­cial occa­si­ons. Such gifts must be inten­ded for use in the medi­cal prac­ti­ce, for trai­ning pur­po­ses or for the bene­fit of pati­ents. Gifts for pri­va­te pur­po­ses are not allowed.This also means that manu­fac­tu­r­ers and dis­tri­bu­tors of medi­cal devices need to ensu­re that any trai­ning they pro­vi­de for medi­cal pro­fes­sio­nals is rele­vant and remains within finan­ci­al­ly reasonable bounds.

Gene­ral con­sul­ting and licen­se agree­ments bet­ween manu­fac­tu­r­ers or dis­tri­bu­tors of medi­cal devices and medi­cal pro­fes­sio­nals or insti­tu­ti­ons are per­mit­ted, but it is neces­sa­ry to ensu­re an appro­pria­te balan­ce and pro­por­ti­on bet­ween per­for­mance and con­side­ra­ti­on. Dona­ti­ons to medi­cal insti­tu­ti­ons from manu­fac­tu­r­ers or dis­tri­bu­tors may only be pro­vi­ded for a cha­ri­ta­ble pur­po­ses, such as impro­ving pati­ent or health care or pro­mo­ting medi­cal rese­arch, and such dona­ti­ons must be mana­ged by the medi­cal institution.

Other­wi­se, they are not per­mit­ted. Medi­cal devices are to be bought and sold sub­ject to gene­ral com­pe­ti­ti­on, based on qua­li­ty and pri­cing. Manu­fac­tu­r­ers and dis­tri­bu­tors of medi­cal devices may not offer or pro­vi­de cash pay­ments or bene­fits in kind to medi­cal pro­fes­sio­nals, not even indi­rect­ly. Any cash reba­tes and reba­tes in kind which are pro­vi­ded in the cour­se of sales tran­sac­tions must be spe­ci­fied in the invoice.

Cri­mi­nal lia­bi­li­ty in accordance with the Cri­mi­nal Code

If any of the afo­re­men­tio­ned rules of con­duct are vio­la­ted, manu­fac­tu­r­ers and dis­tri­bu­tors of medi­cal devices, as well as medi­cal pro­fes­sio­nals, could face pro­se­cu­ti­on under the pro­vi­si­ons of the Ger­man Cri­mi­nal Code. The pur­po­se of the­se pro­vi­si­ons is to ensu­re fair com­pe­ti­ti­on in the health care sec­tor and to pro­tect pati­ents’ con­fi­dence in the inte­gri­ty of decis­i­ons by medi­cal pro­fes­sio­nals. The cri­mes of medi­cal bri­be­ry in accordance with § 299b of the Cri­mi­nal Code and medi­cal cor­rup­ti­on in accordance with § 299a of the Cri­mi­nal Code have exis­ted sin­ce June 2016. § 299b of the Cri­mi­nal Code sta­tes e.g. that tho­se who, in the cour­se of exer­cis­ing their pro­fes­si­on, offer bene­fits to a medi­cal pro­fes­sio­nal in exch­an­ge for an unfair pre­fe­rence by the medi­cal pro­fes­sio­nal with regard to the lat­ter’s purcha­sing of medi­cal devices face a pri­son sen­tence of up to three years or a mone­ta­ry fine.

Medi­cal pro­fes­sio­nals who demand con­side­ra­ti­on in exch­an­ge for an unfair pre­fe­rence in the purcha­se of medi­cal devices could also face a pri­son sen­tence of up to three years or a mone­ta­ry fine in accordance with § 299a of the Cri­mi­nal Code.If the medi­cal pro­fes­sio­nal is a public offi­ci­al or a phy­si­ci­an employ­ed by a public insti­tu­ti­on, tho­se who pro­vi­de bene­fits could also face pro­se­cu­ti­on for bri­be­ry in accordance with § 334 of the Cri­mi­nal Code or for gran­ting an advan­ta­ge in accordance with § 333 of the Cri­mi­nal Code, while the phy­si­ci­ans who accept the­se bene­fits may face pro­se­cu­ti­on for cor­rup­ti­on in accordance with § 332 of the Cri­mi­nal Code or for accep­ting an advan­ta­ge in accordance with § 331 of the Cri­mi­nal Code.

It is the­r­e­fo­re essen­ti­al to ensu­re that bene­fits pro­vi­ded to medi­cal pro­fes­sio­nals are in reasonable pro­por­ti­on to the con­side­ra­ti­on. In gene­ral, any bene­fit pro­vi­ded to a medi­cal pro­fes­sio­nal is con­side­red to be an “advan­ta­ge” in terms of the­se sta­tu­tes. This is the case even if con­side­ra­ti­on is pro­vi­ded by the medi­cal pro­fes­sio­nal, if the con­side­ra­ti­on is not in reasonable pro­por­ti­on to the bene­fit. Only reasonable reim­bur­se­ment of expen­dit­ures is not con­side­red an advan­ta­ge, and the­r­e­fo­re would not estab­lish cri­mi­nal lia­bi­li­ty for the manu­fac­tu­r­ers or dis­tri­bu­tors of medi­cal devices.

Pro­vi­si­ons of the Medi­cal Adver­ti­sing Act [Heil­mit­tel­wer­be­ge­setz]

The pro­vi­si­ons of com­pe­ti­ti­on law also include rules which app­ly in case of vio­la­ti­ons of the afo­re­men­tio­ned prin­ci­ples of con­duct. For exam­p­le, the Medi­cal Adver­ti­sing Act (only in Ger­man) pro­vi­des for a fine of up to € 50,000, in the con­text of an admi­nis­tra­ti­ve offen­se, if bene­fits or other gifts are offe­red which are not inten­ded for use in a medi­cal or phar­maceu­ti­cal prac­ti­ce. This includes any unpaid bene­fit which is pro­vi­ded in con­nec­tion with adver­ti­sing for a spe­ci­fic medi­cal device. If con­side­ra­ti­on is pro­vi­ded by the medi­cal pro­fes­sio­nal, an admi­nis­tra­ti­ve offen­se in accordance with the Medi­cal Adver­ti­sing Act would only come into con­side­ra­ti­on if the con­side­ra­ti­on is desi­gned to con­ce­al the fact that the bene­fit was actual­ly pro­vi­ded free of char­ge from a finan­cial viewpoint.

Pro­vi­si­ons of the Unfair Com­pe­ti­ti­on Act

Gene­ral­ly spea­king, acts which vio­la­te the Medi­cal Device Code (only in Ger­man) may also vio­la­te the pro­vi­si­ons of the Unfair Com­pe­ti­ti­on Act. Such vio­la­ti­ons may result in future desis­tance claims for com­pe­ti­tors, entit­ling them to sue the medi­cal pro­fes­sio­nals for desis­tance from such conduct.

Con­clu­si­on

Manu­fac­tu­r­ers and dis­tri­bu­tors of medi­cal devices should careful­ly adhe­re to the com­pli­ance rules pre­sen­ted abo­ve in their dealings with medi­cal pro­fes­sio­nals. Par­ti­cu­lar­ly con­side­ring the seve­re pen­al­ties pro­vi­ded for in the Ger­man Cri­mi­nal Code, it would make sen­se for manu­fac­tu­r­ers and dis­tri­bu­tors of medi­cal devices to con­ti­nu­al­ly train and sen­si­ti­ze their employees, par­ti­cu­lar­ly their sales employees, in order to satis­fy their com­pli­ance requi­re­ments. Com­pli­ance codes should not only be imple­men­ted by com­pa­nies, but prac­ti­ced as well.

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