Avoiding Compliance Pitfalls in Onsite Events

Post By Tim Curry

In light of the recent U.S. Attorney’s Office lawsuit alleging 80,000 Novartis doctor-education events were potentially violations to anti-kickback laws (read the story here,) now is a great time to take stock of what makes for a compliant, engaging educational program for HCPs, and what practices are taboo and can land your brand in hot water.

We’ve compiled some tips based on where Novartis went wrong to help you and your company stay compliant and avoid making costly (and potentially embarrassing) mistakes.

Strictly Business

A major issue with the Novartis programs being cited by the U.S. Attorney’s Office was the perceived lack of education being conducted at onsite programs, which were reported as company-sponsored educational events.

To tackle the glaringly obvious problem: TO BE A COMPANY-SPONSORED EDUCATIONAL EVENT, EDUCATION MUST BE CONDUCTED. Per the PhRMA Marketing Code, “…it is appropriate for occasional meals to be offered as a business courtesy to the healthcare professionals as well as members of their staff attending presentations, so long as the presentations provide scientific or educational value and the meals (a) are modest as judged by local standards; (b) are not part of an entertainment or recreational event; and (c) are provided in a manner conducive to informational communication.”

“But wait,” you say, “Shaking hands and kissing babies and creating relationships is all part of doing business!” Yes, you’re right, but I counter: your customer knows you didn’t invite them to dinner just because they’re a fantastic human being, and they expect that you’ll want to discuss your product at length. That’s how they learn about it, hence the term ‘educational event.’ So shake hands, kiss babies, create relationships, and then get down to the business at hand; discussing your product with your customer and educating them.

Location, Location, Location

The programs in question were onsite events, many involving dinners. While serving HCPs a meal does not in and of itself violate kickback laws, the location of a dinner program can make all the difference in whether that program is compliant. A venue doesn’t have to be a ‘dive’; on the contrary, a desirable venue is a must-have part of the recipe for a successful onsite event.

An instance where Novartis went wrong: Novartis is accused of hosting HCPs at the hip, exclusive Nobu restaurant. Posh eateries like Nobu might not necessarily cost substantially more than any other local sushi restaurant, but the perception of a venue as “trendy,” “exclusive,” or “expensive” raises regulatory eyebrows, and can get brands and companies into hot water. The PhRMA Marketing Code language around venue selection dictates that meals in conjunction with an educational program should be “modest as judged by local standards.” So pick a nice, modest, moderately-priced eatery with amazing food, and concerns around whether your venue is a potential violation will be non-existent.

When in Doubt, Ask Grandma

At the other end of the perception spectrum from venues like Nobu are the events that Novartis allegedly conducted at nice, not-so-modest, moderately-priced Hooters locations. (Insert head shake here.) Understand, this is not a critique of anyone’s life choices or personal preferences. As Grandma would say, there’s a time and a place for everything. While short shorts and hot wings have surely been conducive to many business deals, education is typically best undertaken without distraction. And therein lies the rub: business versus education. Kickback versus learning. See the difference?

Still not sure how to tell whether an event is compliant or conducive to educational programs sponsored by business? When in doubt, ask yourself, what would your grandmother say? (Not the cool Grandma; the other one, who is horrified that people wear jeans on airplanes instead of their Sunday best.)

Some good questions to ask when planning an onsite program:

  • Would most doctors hesitate to tell their patients they went to a program at the venue you’ve chosen?
  • Do you need a stack of $1 bills to tip the servers?
  • Is the venue loud/public/without a private event space, or does it reek of impropriety? (If “VIP Room” is the private space, please see the last section about “exclusive” spaces being taboo.)
  • If the answer to any of the above questions is “yes,” or Grandma says no, you need to start your venue search all over again.

Avoid the Issue

A great way to prevent compliance-related issues with onsite programs is to NOT conduct onsite programs outside of physician offices. I know, I know: brands love onsite programs, and there are HCPs who love them, too. But why? (And by the way, I’d LOVE to hear your thoughts on this question.)

Costs, logistics, compliance concerns, and HCPs wishing to avoid Open Payments Act reporting have made onsite programs a less attractive option for brands. Offering high-quality virtual meeting programs as educational programming, or offering continuous engagement opportunities through brand portals coupled with representative-requested on-demand virtual discussions can provide other avenues by which companies can interact with high-value HCPs and have fewer concerns about doing so in a compliant fashion.

Common Sense Prevails

So, in summary: Novartis is facing an uphill battle to explain how 80,000 onsite events don’t violate anti-kickback laws, which could have been easily avoided had the sponsoring parties simply used common sense and referenced the PhRMA Marketing Code.

You can help your company avoid these same missteps using the tips above as guide. Make sure you’re actually providing educational content, avoiding venues like Nobu and Hooters, and avoid the entire issue of onsite program perception issues by instead conducting virtual meetings or hosting HCPs through brand portals. When in doubt, use common sense and give any decisions the, “What would Grandma say?” test. Your compliance department (and likely your CEO,) will thank you.