November 29, 2012

Will The White House Change The Sunshine Rules?

From: Pharamlot

By Ed Silverman

Earlier this week, the Centers for Medicare & Medicaid Services finally sent a final version of the Sunshine rule to the White House for approval (see this). The controversial rule, which became law as part of the Affordable Care Act, is supposed to determine ways for gathering and publishing data that contain financial ties between physicians and drug and device maker.

The data would include all ownership or investment interests held by a doctor or family member, and that info must also be disclosed. Industry is concerned there will not be enough time to implement the rule. And penalties for violations can range from $1,000 to $100,000. The CMS has estimated it will cost health-care companies and providers about $224 million in the first year and $163 million annually thereafter to comply

Originally, drug and device makers and group purchasing organizations were to start collecting data this past January, but that was postponed to January 2013. But the CMS has repeatedly delayed presenting a final version of the rule, frustrating industry about the ability to meet timing requirements (back story). Now, though, the CMS will not require data collection until after the final rule is published, and retroactive reporting will not be required.

But since the final version has not been publicly released, sources say the controversy over disclosure – and specifically, the requirements in the final rule – may not be over. Even as some companies and consumer advocates urge publication of the final rules, some drugmakers and medical societies are balking at provisions that they complain are too sweeping and suggest implementation should be delayed.

For instance, the American Medical Association wrote a letter last month to ask the CMS to reconsider having the Center for Program Integrity implement the Sunshine Act “because it will cause significant confusion about the purpose of the transparency reports and create a strong perception that anything contained in a transparency report presumptively raises ethical, fraud, abuse, and program integrity concerns” (here is the letter).

Sources say lobbying has already begun at the White House and the OMB’s Office of Information and Regulatory Affairs to make changes. And one source notes that last year, the same office was behind a decision to gut a key provision contained in financial conflict of interest rules that were being developed by the National Institutes of Health. The provision would have required universities to disclose financial ties between academic researchers and industry on publicly accessible web sites (back story).

Meanwhile, drugmakers have previoulsy expressed concern with various provisions of the Sunshine regulation. For instance, Eli Lilly (LLY) believes it would have to rework its existing system for disclosing payments to physicians that was created to comply with the terms of a 2009 settlement with the federal government over alleged illegal marketing of its Zyprexa antipsychotic, Dow Jones reports.

And Johnson & Johnson (JNJ) had objected to a CMS proposal to require reporting of payments by foreign affiliates, including those that do not operate in the US, the news service adds. The health care giant may have numerous entities that make products that are eventually sold by US divisions, but it would not want overseas units to have to report physician payments.

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