MLN BookletMedicare Fraud & Abuse: Prevent, Detect, Report
ICN MLN4649244 January 2021
Page 15 of 23
Pharmaceutical and Medical Device Industries Codes of Ethics
Both the pharmaceutical industry, through the Pharmaceutical Research and Manufacturers of
America (PhRMA), and the medical device industry, through the Advanced Medical Technology
Association (AdvaMed), adopted codes of ethics regarding relationships with health care
professionals. For more information, visit the PhRMA Code on Interactions With Health Care
Professionals and the AdvaMed Code of Ethics.
Relationships With the Pharmaceutical and Medical Device Industries
Some pharmaceutical and device companies use sham consulting agreements and other
arrangements to buy physician loyalty to their products. As a practicing physician, you may have
opportunities to work as a consultant or promotional speaker for the drug or device industry. For every
nancial relationship oered to you, evaluate the link between the services you can provide and the
compensation you will get. Test the appropriateness of any proposed relationship by asking yourself
the following questions:
●
Does the company really need your specic expertise or input?
●
Does the company’s monetary compensation to you represent a fair, appropriate, and
commercially reasonable exchange for your services?
●
Is it possible the company is paying for your loyalty, so you prescribe its drugs or use its devices?
If your contribution is your time and eort or your ability to generate useful ideas and the payment
you receive is fair-market-value compensation for your services without regard to referrals, then,
depending on the circumstances, you may legitimately serve as a bona de consultant. If your
contribution is your ability to prescribe a drug, use a medical device, or refer patients for
services or supplies, the potential consulting relationship likely is one you should avoid as it
could violate fraud and abuse laws.
Transparency in Physician-Industry Relationships
Although some physicians believe free lunches, subsidized trips, and gifts do not aect their medical
judgment, research shows these types of privileges can inuence prescribing practices.
Federal Open Payments Program
The Federal Open Payments Program
highlights nancial relationships among
physicians, teaching hospitals, and drug
and device manufacturers. Drug, device,
and biologic companies must publicly
report nearly all gifts or payments made
to physicians.
Industry Relationships
For more information on distinguishing between
legitimate and questionable industry relationships,
refer to the OIG’s Compliance Program Guidance for
Pharmaceutical Manufacturers.