OFFICE  OF 
INSPECTOR  GENERAL 
Richard  P.  Kusserow 
INSPECTOR  GENERAL  OFFICE OF INSPECTOR GENERAL 
The mission of the Office of Inspector General (OIG), as mandated by Public Law 95-452, as 
amended, is to protect the integrity of the Department of Health and Human Services (HHS) 
programs as well as the health and welfare of beneficiaries served by those programs. This 
statutory mission is carried out through a nationwide network of audits, investigations, and 
inspections conducted by three OIG operating components: the Office of Audit Services, the 
Office of Investigations, and the Office of Evaluation and Inspections. The OIG also informs 
the Secretary of HHS of program, and management problems, and recommends courses to 
correct them. 
OFFICE OF AUDIT SERVICES 
The OIGs Office of Audit Services (OAS) provides all auditing services for HHS, either by 
conducting audits with its own audit resources or by overseeing audit work done by others. 
Audits examine the performance of HHS programs and/or its grantees and contractors in 
carrying out their respective responsibilities and are intended to provide independent 
assessments of HHS programs and operations in order to reduce waste, abuse, and 
mismanagement and to promote economy and efficiency throughout the Department. 
OFFICE OF INVESTIGATIONS 
The OIGs Office of Investigations (01) conducts criminal, civil, and administrative 
investigations of allegations of wrongdoing in HHS programs or to HHS beneficiaries and of 
unjust enrichment by providers. The investigative efforts of 01 lead to criminal convictions, 
administrative sanctions, or civil money penalties. The 01 also oversees State Medicaid fraud 
control units which investigate and prosecute fraud and patient abuse in the Medicaid program. 
OFFICE OF EVALUATION AND INSPECTIONS 
The OIGs Office of Evaluation and Inspections (OEI) conducts short-term management and 
program evaluations (called inspections) that focus on issues of concern to the Department, 
the Congress, and the public. The findings and recommendations contained in these inspection 
reports generate rapid, accurate, and up-to-date information on the efficiency, vulnerability, 
and effectiveness of departmental programs. 
This report was prepared under the direction of Mark R.   Ph.D., the Regional 
Inspector General, and Martha B. Kvaal, Deputy Regional Inspector General, Boston Region, 
Office of Evaluation and Inspections. Participating in this project were the following people: 
Boston Region  Headquarters 
David Veroff, Project Leader  Mary Beth Clarke 
David Schrag, Lead Analyst  Penny  Thompson 
Barry  McCoy  Barbara Tedesco 
Fred Kwan  E X E C U T I V E   S U M M A R Y

PURPOSE 
The purpose of this study is to estimate to what extent physicians are offered gifts and 
payments from pharmaceutical companies. 
BACKGROUND 
There has been much attention paid recently to prescription drug promotion practices 
involving payments and gifts. In December 1990, the Senate Labor and Human 
Resources Committee held hearings that highlighted questionable promotional  * 
practices. At these hearings, the American Medical Association (AMA) announced 
the release of ethical guidelines on gifts to physicians from industry. The 
Pharmaceutical Manufacturers Association (PMA) immediately adopted these 
guidelines in full. 
In August 1991, we reported the range of prescription drug promotion practices 
involving payments and gifts. We discussed the vulnerabilities such practices present 
and the responses of government and private groups to inappropriate and illegal 
practices. 
We found that gifts and offers of value related to studies, speaking engagements, and 
program attendance are used by pharmaceutical companies to promote their drugs. 
We also found that promotional practices involving items of value appear to affect 
physicians prescribing decisions.  The medical community and the pharmaceutical 
industry consider certain promotional practices involving items of value to be 
inappropriate.  It is unclear, however, what effect their recently developed ethical 
guidelines have had and will have on pharmaceutical companies and physicians. The 
Department of Health and Human Services (HHS) has taken initial action in 
controlling inappropriate or illegal activity. In particular, the Food and Drug 
Administration (FDA) has drafted guidelines defining the difference between scientific 
education and promotion. 
We concluded in our first report that the concerns raised by our findings warranted 
further monitoring of prescription drug promotion. As part of that effort, we have 
selected a national random sample of approximately 1,000 physicians to inquire about 
items of value offered to them by pharmaceutical companies. 
We asked physicians questions about the offers that had been extended to them in the 
previous 12 months. The period covered by our survey was fall 1990 to fall 1991. The 
objective of our study is not to evaluate the effectiveness of the   guidelines, 
which were in effect for most but not all of our survey period. We do, however, use 
the guidelines as reference points to classify the offers. 
i  FINDINGS 
 on at   one   in the year 
prior to fall  of   frequently   pens, 
 pharmaceutical samples for personal or family   and &inks; 
 included travel   and   for attending educational 
 and   for participation in 
Pharmaceutical companies offered gifts and payments on an average of 
occasions to each physician and offered gifts and payments other than small 
gifts such as pens and notepads on an average of 13 occasions to each 
physician.  . 
According to physicians estimates, the median value of all gifts and payments 
offered each physician was $125. 
Pharmaceutical companies were more likely to offer gifts and payments to 
physicians who were frequent prescribers than to those who were infrequent 
prescribers. 
In the year prior to fall   many   or 
 that are   defii by the   as being 
These   gifts that bear no relation to the   work and 
payment of travel   or honoraria for attending educational   or 
Pharmaceutical companies offered such gifts or payments at least once to 27 
percent of physicians. 
Pharmaceutical companies offered such gifts or payments at least once to 36 
percent of physicians who wrote at least 50 prescriptions a week. 
Some of these offers, in addition to being defined as inappropriate, may be 
illegal. 
 of   is not   some 
In the year prior to fall   many 
gijIs0rpaymenBthatfallhtogmyarearintheguideline.s. 
  Pharmaceutical companies offered 5 1 percent of physicians pharmaceutical 
samples for their own or their familys use. These offers may have   no 
relation to the physicians practice and may not have entailed benefits to 
patients. 
Pharmaceutical companies offered physicians compensation for involvement in 
different types of focus groups and studies. Some of these offers may have 
been token consulting arrangements or gifts with strings attached. 
ii  RECOMMENDATIONS 
Although the findings of this study do not allow us to measure the effects of the 
 guidelines, the evidence of so many offers now seen as inappropriate 
raises some important conclusions.  If most of these offers took place prior to the 
guidelines promulgation, then these findings indicate that the guidelines addressed a 
significant problem and that continued attention to their adherence is necessary. If, 
however, some of the offers have taken place since the implementation of the 
guidelines, more attention should be paid to their adherence. Our recommendations 
focus on further clarifications the Department of Health and Human Services and the 
PMA should make on the interpretation of certain offers. 
 Service (PHS),   the Food and Drug   (FDA), 
 what it   activity and what it 
These guidelines would clarify how important FDA considers gifts and 
payments associated with educational seminars and meetings to be in indicating 
promotional intent. 
 should work with the American Medical 
Association to more   define   of   in the   of 
Improved clarity is necessary in areas of market surveys, focus groups, and 
marketing  surveillance  research. 
We received written comments on our draft report from the Assistant Secretary for 
Health (PHS), the American Medical Association (AMA), the Pharmaceutical 
Manufacturers Association (PMA), the Accreditation Council for Continuing Medical 
Education (ACCME), and the Public Citizen Health Research Group (PCHRG). The 
full texts of these comments are in Appendix E. We also received notice of 
concurrence with no elaboration from the Assistant Secretary for Planning and 
Evaluation. 
The PHS concurred with the recommendations of our report. They also made several 
technical comments resulting in our making slight changes in presentation, including 
more information about biasing effects. The AMA cited the importance of our study 
and had favorable comments about it. The PMA felt the report had significant 
methodological flaws and problems with the reporting of the results and conclusions. 
We addressed the   comments about the presentation of the value of offers, but 
disagree with the remainder of their comments. The ACCME made supportive 
111  comments. The PCHRG supported our findings. However, because they felt our 
findings demonstrated that the   guidelines have failed, they suggested that 
we recommend legislation banning gifts and payments extended for promotional 
purposes. Because we cannot draw conclusions about the effectiveness of the 
guidelines, we have not incorporated   suggestion to recommend new 
legislation. 
iv  TABLE  OF  CONTENTS

 . . . . .   .   . . I . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  1

FINDINGS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  3

Most Physicians Were Offered At Least One Gift or Payment . . . . . . . . . . . . . . . . . 3

Many Physicians Were Offered Inappropriate Gifts or Payments . . . . . . . . . . . . . . . 
Other Offers Fall Into Gray Areas in   Guidelines  . . . . . . . . . . . . . . . . . 8

RECOMMENDATIONS  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  9

COMMENTS ON DRAFT REPORT  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

APPENDICES

A.  Ethical  Guidelines  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  A . 1

B.  Methodology  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  B . 1

C.  Offers by Specialty  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  C - 1

D.  Questionnaire  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  D - 1

E.  Detailed Comments on Draft Report  . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  E . 1

F.  Notes  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   F-  1
 I N T R O D U C T I O N

The purpose of this study is to estimate to what extent physicians are offered gifts and 
payments from pharmaceutical companies. 
BACKGROUND 
There has been much attention paid recently to prescription drug promotion practices 
involving payments and gifts.  In December 1990, the Senate Labor and Human 
Resources Committee held hearings that highlighted questionable promotional 
practices. At these hearings, the American Medical Association (AMA) announced 
the release of ethical guidelines on gifts to physicians from industry. The 
Pharmaceutical Manufacturers Association (PMA) immediately adopted these 
guidelines in full. 
In August 1991, we reported the range of prescription drug promotion practices 
involving payments and gifts. We discussed the vulnerabilities such practices present 
and the responses of government and private groups to inappropriate and illegal 
practices. 
We found that gifts and offers of value related to studies, speaking engagements, and 
program attendance are used by pharmaceutical companies to promote their drugs. 
We also found that promotional practices involving items of value appear to affect 
physicians prescribing decisions. The medical community and the pharmaceutical 
industry consider certain promotional practices involving items of value to be 
inappropriate.  It is unclear what effect their recently developed ethical guidelines 
have had and will have on pharmaceutical companies and physicians. The 
Department of Health and Human Services (HHS) has taken initial action in 
controlling inappropriate or illegal activity. In particular, the Food and Drug 
Administration (FDA) has drafted guidelines defining the difference between scientific 
education and promotion. The FDA has also set up a hotline for physicians and 
others to report questionable promotional 
We concluded that the concerns raised by our findings warranted further monitoring 
of prescription drug promotion.  As part of that effort, we undertook a national survey 
of physicians to inquire about items of value that had been offered to them by 
pharmaceutical companies.  We mailed surveys to 997 physicians who bill the 
Medicare program.  We received 617 usable responses from physicians in a wide 
variety of specialties and locations.  For details on our sampling selection, survey 
methods, survey instrument, possible biases, and respondent profiles, see appendix B. 
We asked physicians several background questions and then inquired about whether 
they had been offered a variety of gifts, promotional offers, research funding or 
payments, and payments or travel for attending or presenting at educational or other 
1  programs.  We asked about how often these offers had been presented and what their 
value was, and then whether there were obligations to prescribe drugs attached to the 
offer. For offers involving educational programs, we asked whether or not they were 
offered continuing medical education credits for the program. 
We asked physicians questions about the offers that had been extended to them in the 
previous 12 months. The period covered by our survey was fall 1990 to fall 1991. The 
objective of our study is not to evaluate the effectiveness of the   guidelines, 
which were in effect for most but not all of our survey period. We do, however, use 
the guidelines as reference points to classify the offers. 
We present all data without factoring in any biasing effects of a 38 percent 
nonresponse rate and false or incorrect reporting by respondents. As we argue in   
appendix B, these biasing effects are likely to cause underreporting of the frequency 
and size of the offers extended. Therefore, figures on frequency and size of offers in 
this report are likely to be conservative estimates. 
Our review was conducted in accordance with the Interim   for Inspections 
issued by the Presidents Council on Integrity and Efficiency. 
2
 FINDINGS

Pharmaceutical companies   or   on at   one occasion in the year 
 to 82   of physicians. 
Pharmaceutical companies offered gifts and payments on an average of 28 
occasions to each physician and offered gifts and payments other than small 
gifts such as pens and notepads on an average of 13 occasions to each 
physician. 
Pharmaceutical companies offered gifts or payments on at least one occasion in the  . 
past year to 82 percent (95 percent confidence interval is   3 percent) of physicians 
and on 5 or more occasions to 79 percent.  These offers ranged from small gifts such 
as prescription pads and pens to major funding for research activity. On average, 
pharmaceutical companies offered gifts or payments 28 times   4) to each physician 
in the year prior to fall  Most physicians (77 percent) were offered small gifts 
such as pens and prescription pads, but, on average, each physician was offered at 
least one more substantive gift or payment. Pharmaceutical companies offered gifts or 
payments other than small gifts to 71 percent of physicians; they extended these offers 
on an average of 13 occasions   3) to each physician. Commonly offered items 
included pharmaceutical samples for personal or family use (50 percent), meals or 
drinks (37 percent), and payment for participating in focus group sessions (18 
percent). (See table 1 for more detail.) 
According to physicians estimates, the median value of all gifts and payments 
offered each physician was $125. 
The value of the offers that pharmaceutical companies made to physicians ranged 
from $0 to $38,315. The median total dollar value physicians ascribed to items offered 
to them during the year was $125.  The median value of each offer was 
approximately $10.  Three offers for research funding were $20,000 or more. 
Offers involving research and educational activities were worth more than those 
involving gifts. Compensation for research involving an experimental drug not yet 
approved by FDA had a median value of $1,250 and travel and/or accommodation 
expenses to attend a program or meeting at which the physician did not present 
information had a median value of $550. (See table 1 for detailed information.) 
3
 Table 1

Offers from Pharmaceutical Companies to Physicians

al programs at which the physician was not a 
 OIG   of Physicians, Fall 1991. 
4
   Pharmaceutical companies were more likely to offer gifts and payments to 
physicians who were frequent prescribers than to those who were infrequent 
prescribers. 
We asked physicians how many prescriptions for drugs they write per week. 
Pharmaceutical companies offered at least one gift or payment to 89 percent of the 
physicians who write at least one prescription per week; they offered at least one gift 
or payment to 35 percent of the physicians who do not prescribe drugs (this difference 
is significant: chi-square value is 96 at 1 degree of freedom). They were also more 
likely to offer gifts and payments to physicians who frequently prescribe drugs than to 
physicians who less frequently prescribe drugs. For example, pharmaceutical 
companies offered at least one payment or gift to 94 percent of the physicians who 
write at least 50 prescriptions a  Figure 1 displays the relationship between 
number of prescriptions written and percent of physicians offered at least one 
 or gift. 
Figure 1 
Frequent Prescribers are More Likely to Be Extended Offers 
95-
90-
80-
75-
70-
65-
60-
55-
z-
35-
30-
25-
20-
5-
We also asked physicians to identify their primary specialty and classified their answers 
into forty-three specialties. Pharmaceutical companies extended offers to many 
physicians in high-prescribing specialties, such as internal medicine, family practice, 
dermatology, and cardiology. (See appendix C for more detailed information.) 
5
 In the year prior to   1991,   or 
payments   are specifically   by the  as being 
On December 3, 1990, the American Medical Association revised its ethical code to 
incorporate new guidelines on gifts to physicians from the   The 
Pharmaceutical Manufacturers Association endorsed these guidelines in full. These 
guidelines define acceptable and unacceptable offers in some areas. The following are 
specified as offers that are not appropriate for physicians to accept or pharmaceutical 
companies to offer: 
*  Gifts of cash 
* 
Gifts that are not related to the physicians work or that do not entail 
benefits to the patient
* 
The cost of travel, lodging, and other personal expenses of physicians 
attending meetings
* 
Subsidies to compensate for the physicians time attending a meeting
* 
Token consulting arrangements
* 
Gifts with strings attached 
Some of these guidelines outline activities that are difficult (if not impossible) to 
examine in a survey of physicians. For example, it is difficult to distinguish between 
token and real consulting arrangements. However, we asked physicians whether 
they had been offered several items that are now clearly prohibited by the guidelines: 
gifts of cash, travel and/or accommodation expense for attending a meeting for the 
physician and for a spouse or companion, and certain gifts that are not related to the 
physicians work or that do not entail benefits to the patient. 
Pharmaceutical companies offered gifts or payments explicitly defined by the 
current   guidelines as being inappropriate on at least one occasion 
to 27 percent of physicians. 
Pharmaceutical companies offered entertainment or sporting event tickets to 6 percent 
of the physicians, other items for personal or family use to 6 percent, gifts of money to 
1 percent, gifts that required the physician to prescribe a companys drug as a 
condition for receiving the offer to 1 percent, travel to and/or accommodations at a 
program at which the physician was not a presenter to 11 percent, a spouse or 
companions travel to and/or accommodations at a program at which the physician was 
not a presenter to 6 percent, and cash honoraria for attending a program at which the 
physician was not a presenter to 11 percent. All of these offers were specifically 
defined by the PMA guidelines as being 
On average, the total value of the offers prohibited by the PMA guidelines was $574 
(median value was $105). Pharmaceutical companies offered 4 percent of physicians 
gifts or payments outside of the guidelines on 10 or more occasions, including one  physician who was offered gifts or payments prohibited by the guidelines on 33 
occasions. 
Pharmaceutical companies offered gifts or payments explicitly defined by the 
current   guidelines as being inappropriate on at least one occasion 
to 36 percent of physicians who wrote more than 50 prescriptions a week. 
Physicians who are heavy prescribers of drugs were more frequently offered gifts and 
payments outside of the guidelines. For example, pharmaceutical companies offered 
such gifts or payments on at least one occasion in the last year to 30 percent of the 
physicians who write 5 or more prescriptions a week, 31 percent of the physicians who 
write 10 or more prescriptions a week, and 36 percent of the physicians who write 50 
or more prescriptions a week. 
Some of these offers, in addition to being defined as inappropriate, may be 
illegal. 
The Medicare and Medicaid anti-kickback statute (42 U.S.C.   makes it 
a felony for a person or entity to knowingly and willfully offer, pay, solicit, or receive 
any remuneration with the intent to induce or in return for the ordering or furnishing 
of items or services paid for in whole or in part under the Medicare or Medicaid 
programs. A person or entity is also subject to exclusion from participation in the 
Medicare and Medicaid programs for a knowing and willful violation of the 
kickback statute, 42 U.S.C.  7(b) (7). 
The offering of compensation or gifts based on the number of prescriptions for 
pharmaceuticals which might be paid for by the Medicare and Medicaid programs 
could breach the anti-kickback statute. A total of 18 (nonresearch) offers of 
remuneration were made to physicians requiring the prescribing of a particular drug 
as a condition for receiving the offer. To the extent that these drugs were covered 
and reimbursed in whole or in part by the Medicare or Medicaid programs, the 
offering and receipt of such remuneration could be considered as violative of the 
kickback  statute. 
In addition, the offers of compensation for conducting studies that required prescribing 
the drug being studied to people who were not previously taking it could, depending 
on the design of the study, be in violation of the anti-kickback provisions. 
Pharmaceutical companies made offers of this type to 4 percent of the physicians. 
7
  dejiin of what   inappropriate   not precise   some 
cases.  In the year   companies   many   or 
payments that   areas in the 
Pharmaceutical companies offered 51 percent of physicians pharmaceutical 
samples for their own or their familys use. These offers may have had no 
relation to the physicians practice and may not have entailed benefits to 
patients. 
The   guidelines clearly disapprove of pharmaceutical companies offering 
any gift that is not related to the physicians work or that does not entail benefits to a 
patient. It is difficult to see how paying patients get any benefit from companies 
offering pharmaceutical samples to physicians for their own or their familys use. Yet, 
pharmaceutical companies offered 51 percent of the physicians pharmaceutical 
samples for their own or their familys 
Pharmaceutical companies offered physicians compensation for involvement in 
different types of focus groups and studies. Some of these offers may have 
been token consulting arrangements or gifts with strings attached. 
The   guidelines are vague in their definition of inappropriate or 
appropriate research funding by pharmaceutical companies, disapproving only of token 
consulting arrangements and gifts with strings attached. None of the questions we 
asked directly addressed these issues, but we did delineate several types of research 
funding. 
Pharmaceutical companies offered 4 percent of physicians compensation for 
conducting studies that required prescribing the drug being studied to people who 
were not previously taking it. Some legitimate research protocols require the patients 
involved to be virgin patients to limit the biasing effects of a patient having used the 
drug previously. But, if the study is being done for promotional purposes and the use 
of research funding is simply to start patients on a particular drug, it could be seen as 
a gift with strings attached. 
Pharmaceutical companies offered 2 percent of physicians compensation for 
conducting studies that required recording demographic, but not clinical information. 
This type of research could be seen as illegitimate scientific research and, therefore, 
may be token consulting. 
Finally, focus groups could be used for purposes disapproved of by the 
guidelines (see note 13 for a more detailed discussion). It is not clear whether some 
of these sessions were simply token consulting arrangements. Pharmaceutical 
companies offered 19 percent of the physicians compensation for participating in focus 
group sessions.  RECOMMENDATIONS
 .  . . 
Although the findings of this study do not allow us to measure the effects of the 
 guidelines, the evidence of so many offers now seen as inappropriate 
raises some important conclusions.  If most of these offers took place prior to the 
guidelines promulgation, then these findings indicate that the guidelines addressed a 
significant problem and that continued attention to their adherence is necessary. If, 
however, some of the offers have taken place since the implementation of the 
guidelines, more attention should be paid to their adherence. Our recommendations 
focus on further clarifications the Department of Health and Human Services and the 
PMA should make on the interpretation of certain offers. 
 public Health Service (PHS), through the Food and   (FDA), 
 what it considers promotional   and what 
 scientific 
The FDA has the responsibility for overseeing promotional activities of pharmaceutical 
 It released a draft concept paper in October 1991 on 
pharmaceutical company-supported activities in scientific or educational 
In this paper, FDA spells out the proposed conditions for educational seminars not to 
be seen as promotional. Included in this draft is a statement about gifts: The 
following factors suggest promotional intent: (a. GIFTS) Inducements (other than 
perhaps meals or token gifts), e.g., travel or lodging subsidies, are provided to 
encourage attendance of the target audience.  By making this statement an official 
guideline, FDA would clearly interpret many of the offers attached to seminars 
mentioned in our survey as indicating promotional intent. This type of policy 
statement would be very helpful in delineating FDAs opinion on certain gifts and 
payments. 
 Association   with the American Medical 
Association to more   of propriety in the remaining gray areas of 
Although we are unable to determine the effect of the guidelines on relations with 
industry that the American Medical Association developed and the Pharmaceutical 
Manufacturers Association adopted, the guidelines have clearly heightened awareness 
of the issues and have likely slowed the prevalence of inappropriate gifts and 
payments.  For this reason, we feel it is important to expand the guidelines to more 
effectively define inappropriate activities in the areas of research and focus groups. 
Clarifying what determines a string attached gift or token consulting arrangement 
would allow the pharmaceutical industry to make clear cut decisions about what are 
and are not appropriate ways of conducting post-marketing and market research. 
9
 COMMENTS  ON  THE  DRAFT  REPORT

We received written comments from the Assistant Secretary for Health, the American 
Medical Association, the Pharmaceutical Manufacturers Association, the Accreditation 
Council for Continuing Medical Education, and Public Citizen Health Research 
Group. The full texts of these comments are in Appendix E. We also received notice 
of concurrence with no elaboration from the Assistant Secretary for Planning and 
Evaluation. 
Assistant Secretary for Health 
The Public Health Service concurred with the recommendations of our report. They 
were, however, concerned about our presentation of the value of offers made to 
physicians. They cited the positive skew in the distribution of values and suggested we 
address inconsistencies between the mean and median values. They noted that our 
discussion of potential bias did not include recall bias which they thought would tend 
to cause underreporting. They felt that our presentation of bias was not given 
adequate emphasis by virtue of its placement in a methodological appendix and 
suggested discussion in the text of these issues. They also had several technical 
comments. 
We have changed our presentation of the value of   to consistently reject the median 
values as opposed to mean, thus conservatively estimating the average value of the 
offers.  We added information about the potential bias of short term recall and made 
clear our   about the overall bias direction.  We included a brief summary of 
this information in the introduction to highlight its importance.  We have addressed the 
other technical comments. 
American Medical Association 
The American Medical Association cited the importance of our study and had 
favorable comments about it. They also cited their continuing effort to clarify and 
make more specific their guidelines on gifts from industry to physicians. The AMA 
also noted the positive effects their guidelines have had on the ethical promotion of 
prescription  drugs. 
We welcome the American Medical Association3   in continuing to   and make 
more specific their guidelines.  We are particularly encouraged that the AMA has decided 
to address the complex ethical issues of physicians acceptance of fees for participation in 
market research focus groups and clinical research and their acceptance of 
pharmaceutical samples for personal use.  We hope that the   guidelines have had 
the effects the AMA claims. 
10
 Pharmaceutical Manufacturers Association 
The Pharmaceuricai Manufacturers Association recommended that the final report not 
be published, citing methodological flaws and problems with the reporting of the 
results and conclusions. The PMA asked that we not use the results of our survey to 
draw conclusions about the effectiveness of their ethical guidelines. In particular, they 
felt that the timing of our survey made it impossible to measure the effectiveness of 
their guidelines. They also expressed concerns about the biasing effects of a response 
rate of 62 percent, though they did not speculate on the potential direction of the bias. 
They stated that our presentation interprets all payments and gifts as promotional. 
Finally, they felt that our presentation of the value of the gifts and payments offered 
was misrepresentative because of a positive skew in the distribution. 
We do not agree that there are significant methodological   or problems with our 
presentation.  Our survey was not intended to measure the   of the ethical 
guidelines produced by the   and agreed upon by the  Because  of  concerns 
raised by us in our earlier report entitled   Drug Promotion Involving Payments 
and Gifts, we felt there was a significant lack of   available about how 
frequently or commonly physicians were offered any kind of payment or   from 
pharmaceutical companies. As our purpose states, we conducted this survey to estimate 
the extent to which physicians are   gifts and payments from pharmaceutical 
companies.  We do not draw conclusions or speculate on the timing of the offers, but do 
point out the   implications of our findings if the offers were extended prior to or 
after the promulgation of the guidelines. 
We are convinced that the response rate we attained allows us to state our findings with 
sufficient precision.  While we have no way of explicitly measuring nonrespondent bias, we 
think that nonrespondents would be even more likely to have been   payments and 
gifts.  Comments   the Public Health Service and Public Citizen Health Research 
Group support this position.  We have made a more conclusive statement about this and 
other potential biases in the introduction to the report. 
We agree with   that not all consulting arrangements or payments for research activity 
are necessarily inappropriate or even promohonal in intent.  Certain& manufacturers 
must involve physicians in legitimate clinical research and other decisions and should 
compensate them for this time.  Since, however, the potential   for any type of 
financial   to be used inappropriately to influence prescribing decisions, we felt it was 
important to profile all types of payments and gifts.  We did not make any statement 
implying that all payments are inappropriate and certainly would not make that argument. 
We agree with   comments about our presentation of the values of the  We 
have changed our presentation of the value of   to consistently reflect the median 
values, thus conservatively estimating the average value of the offers. 
11
 Accreditation Council for Continuing Medical Education 
The ACCME made supportive comments. 
Public Citizen Health Research Group 
The Public Citizen Health Research Group (PCHRG) supported our findings. 
However, because they felt our findings demonstrated that the   guidelines 
have failed, they suggested that we recommend legislation banning gifts and payments 
extended for promotional purposes. They felt that our findings demonstrate that 
inappropriate offers have been made since the promulgation of the guidelines. 
On the basis of the findings of this study, we cannot make definitive statements about the 
of the   guidelines.  We certainly agree that there is a possibility 
that inappropriate   were extended after the promulgation of the guidelines, and in 
fact discuss the implications of that possibility in our conclusion. However, we must 
emphasize that our purpose in   this   was not to measure the effectiveness 
of the guidelines, but to estimate to what extent physicians are offered gifts and payments 
from pharmaceutical companies.   the guidelines were developed in the midst of the 
study period only serves to underscore the importance of these issues.  Because we cannot 
draw conclusions about the effectiveness of the guidelines, we have not incorporated 
 suggestion to recommend new legislation. 
12
 APPENDIX  A

 GUIDELINE!3 OF   AMERICAN MEDICAL ASSOCIATION AND

THE  PHARMACEUTICAL   ASSOCIATION

A - l   Report  a6  filed  by  the  House  of  Delegate6  on  December    1990 
American  Medical  Association 
REPORT OF THE COUNCIL ON ETHICAL AND JUDICIAL AFFAIRS 
Report:  F 
(X-90) 
Subject:	 Opinion  of  the  Council  on  Ethical    Judicial 
Affairs--Gifts  to  Physician6  from  Industry 
Presented  by:  Richard  J.    MD,  Chairman 
Referred  to:	 Reference Committee on Amendment6 to 
Constitution  and  Bylaw6 
(David  B.  Carmichael,  Jr., 
1 The  Council  on  Ethical  and  Judicial  Affair6  submits  the 
2 following  opinion  to  the  Rouse  of  Delegate6  for  it6  information  and 
3 recommends  that    report  be  filed. 
4
5 GIFTS TO PHYSICIANS FROM INDUSTRY. Many gifts given to 
6 physicians  by  companies  in  the  pharmaceutical,  device  and  medical 
7 equipment  industries    an  important  and  socially  beneficial 
function.  For  example,  companies  have  long  provided  fund6  for 
9 educational  seminars  and  conferences.  there  ha6  been 
10 growing  concern  about  certain  gifts  from  industry  to  physicians. 
11 Some  gifts  that  reflect  customary  practices  of  industry  may  not  be 
12 consistent  with  principles  of  medical  ethics.  To  avoid  the 
13 acceptance  of  inappropriate  gifts,  physicians  should    the 
14 following  guidelines: 
15
16 1.  Any  gift6  accepted  by  physicians  individually  should 
17 primarily  entail  a  benefit  to  patient6  and  should  not  be  of 
18 substantial  value.  Accordingly,  textbooks,  modest  and  other 
meals 
19 gift6  are  appropriate  if  they    a  genuine  educational 
20 function.  Cash  payments  should  not  be  accepted. 
21
22 2.  Individual  gifts  of  minimal  value  are  permissible  a6  long 
23 a6  the  gift6  are  related  to  the  physicians  work  (e.g.,  pen6  and 
24 notepad6 
25
3.  Subsidies  to  underwrite  the  costs  of  continuing  medical 
27 education  conferences  or  professional  meetings  can  contribute  to 
28 the  improvement  of  patient  care  and  therefrre  are 
29 Since  the  giving  of  a  subsidy  directly  to  a  physician  by  a 
30 company6  sales  representative  may  create  a  relationship  which 
31 could  influence  the  use  of  the  company6  products,  any  subsidy 
32 should  be  accepted  by  the  conference6  sponsor  who  in  turn  can  use 
33 the  money  to  reduce  the  conferences  registration  fee.  Payment6 to 
34 defray  the  costs  of  a  conference  should  not  be  accepted  directly 
35 from  the  company  by  the  physicians  attending  the  conference.  Rep.  F  - page  2 
1 4.    from  not  be accepted to pay for 
2 the cost8 of travel,   or other   of 
3  attending   or meetings, nor 
4 be  accepted  to  compensate  for  the    for 
5 hospitality    not  be  accepted  outside  of    or 
6   event8  held  a8  a  part  of  a  conference  or  meeting.  I t  
appropriate  for  faculty  at  conference6  or  meeting6  to  accept 
8 reasonable  honoraria  and  to  accept  reimbursement  for  reasonable 
9 travel,  lodging  and  expenses.  It  also  appropriate  for 
10   who  provide  genuine  services  to  receive  reasonable 
11 compensation  and  to  accept  reimbursement  for    travel, 
12 lodging  and  meal  expenses.  Token    or  advisory 
13 arrangement6  cannot  be  used  to  justify    physicians 
14 their  time  or  their  travel,    and  other  out-oE-pocket 
15 expenses. 
16
17 5.  Scholarship  or  other  special  funds  to  permit  medical 
18 students,  residents  and    to  attend  carefully  selected 
19 educational  conference8  may  be  permissible  a6  long  a8  the  selection 
20 of  students,  residents  or  fellows  who  will  receive  the 
21 made  by  the  academic  or  training  institution. 
22
23 6.  No  gifts  be  accepted    there  are 
24 attached.  For  example,  physician6    not  accept  if  they 
25 are  given  in  relation  to  the  physicians  prescribing  practices. 
26 addition,  when    underwrite  medical  conference8  or 
27 other  thon  their  own,  responsibility  for  and  control  over  the 
28   of  content,  faculty ,  educational  method8    material8 
29 should  *belong  to  the  organizer8  of  the  conference6  or 
.  . .  APPENDIX  B

METHODOLOGY 
Sample selection 
We surveyed a total of 997 physicians nationally. The physicians were identified from 
a data base of Medicare billing physicians (one percent BMAD file). This file 
identifies physicians not by name, but by Medicare provider number. The provider 
numbers must be linked to name and address by Medicare carriers. In order to limit 
the number of carriers we had to contact for names and addresses, we selected eight 
carriers and then drew a random sample of 125 physicians for each carrier. The 
carriers were selected with probability of selection equal to the number of provider 
numbers in the data base for the carrier divided by the total number of provider 
numbers in the data base nationally. 
The carriers selected were: 
Equitable of North Carolina

Aetna of Hawaii

Florida Blue Shield

Aetna of Oklahoma

Aetna Georgia

Michigan Blue Shield

Texas Blue Shield

Occidental  California

We then randomly selected 125 provider numbers for each of the carriers. Each 
carrier was sent the provider numbers and asked to return the names and addresses of 
the physicians who used them. The carriers were able to identify all but three 
physicians, resulting in our surveying 997 physicians. 
 methods 
We sent each physician a survey and cover letter on September 25, 1991, asking them 
to return the survey by October 7, 1991. We mailed a   letter and another 
copy of the survey to the physicians who had not returned it by October 15, 1991, 
asking them to return it by October 21, 1991. We cut off receipt of the surveys on 
November 29, 1991. Several surveys were received after this date and were not 
included in the analysis. 
B - l   survey 
We asked physicians   of 91 closed ended questions and then requested 
additional comments. Seven questions -- concerning whether the sampling provisions 
of the Prescription Drug Marketing Act of 1987 were being followed -- related to 
another study. See appendix D for a copy of the survey instrument. 
We received usable responses from 617 or 62 percent of the physicians we sampled. 
Of the 38 percent who did not respond, 78, or 21 percent, were returned to us 
because they were undeliverable or the physician no longer practiced or was deceased. 
Table 2 details various characteristics of the physicians responding to the survey. 
Table 2

Profile of Respondents

Average number of years in practice  22 
Percent of respondents participating in research  14% 
Average percent time working on research  10% 
Average, percent of research funded by pharmaceutical companies  22% 
Percent of respondents who see patients in a hospital  84% 
Average percent time working in hospitals  37% 
Percent most often working in an academic medical center  8% 
Percent most often working in a community teaching hospital  30% 
---
Percent most often working in a community nonteaching hospital  62% 
Percent of respondents who see patients in private practice  92% 
Percent in a group practice  42% 
Percent of respondents who are salaried employees of an HMO  3% 
Average number of patients seen per week  87 
Average number of prescriptions written per week  79 
Potential 
There are three sources of potential bias in our sample: (1) The sample we drew 
could be biased, (2) the respondents could differ systematically from the 
nonrespondents, and (3) the respondents could have not answered questions truthfully 
or correctly. 
B - 2   Our sample was drawn as a random sample of physicians in the Medicare provider 
data base.   representative of all physicians nationally. First, 
physicians in   as pediatrics and obstetrics, rarely treat Medicare 
patients. Physicians who treat Medicare patients may be more or less likely than 
physicians who do not treat Medicare patients to have interactions with 
pharmaceutical  companies.  Second, our sample may not represent the Medicare 
population accurately. Our method of sampling could have drawn physicians more or 
less likely to have interactions with pharmaceutical companies. As an attempt to 
measure this potential bias, we compared the specialty mix in our sample with the 
specialty mix nationally and found no obvious problems. Because we did not 
analyze sample bias, we cannot make a   as to the direction or size of the bias. 
We looked at nonrespondent bias carefully. It seems that the potential for 
response was high with this survey. Some physicians who responded had very negative 
reactions to our survey.  Physicians who had had interactions with pharmaceutical 
companies, particularly those who were unsure about the ethics and legality of those 
interactions, were probably less likely to respond to our voluntary survey. However, it 
is quite difficult to measure this potential bias. There is no information that we know 
about nonrespondents that obviously correlates with interactions with pharmaceutical 
companies. The only proxy we have is specialty of the physician. We compared the 
response rates for each specialty and found that overall, response rates are distributed 
across specialties as they are expected to be (see Table 2). A chi-square test was done 
to test whether the response rates were equal across specialties resulting in a statistic 
of 18.45 with  degrees of freedom (no significant difference at   level of 
11 
 we cannot judge the strength of the bias, we expect 
respondent bias to cause our estimates of the level and size of  to be low. 
We also looked at the potential bias of false, incomplete, or misunderstood answering 
of the questions in our survey. As noted above, some physicians were very negative 
about the survey and its implications, perceiving it as an attempt to elicit damaging 
information. In fact, prior to our survey being released, a lawyer was quoted in a 
national newsletter advising physicians to seek the advice of counsel before filling out 
the   If, despite our best efforts to assure the physicians that all 
correspondence was strictly confidential, a respondent suspected that we were seeking 
to catch physicians involved in illegal activity, the person would be unlikely to inform 
us about an activity he or she considered marginally acceptable. There is, of course, 
no way to measure bias of this sort.  But, given the relatively few very negative 
comments from physicians, we are inclined to believe this type of bias was minimal 
(see Table 3). 
There is also the potential for underreporting because of recall bias. We asked 
physicians to recall events up to 12 months prior to the survey date. Physicians are 
probably more likely to recall their latest experiences than earlier ones. However, if a 
physician has been offered one or two payments or gifts that stood out as particularly 
interesting or inappropriate, they could recall them as having occurred within the past 
12 months, even if they were extended more than 12 months prior. We conclude that 
B-3  bias   avoidance of reporting inappropriate activities causes slight underreporting of 
 Bias caused by   recall likely causes stronger underreporting, but 
balanced   by extended 
Overall, the effects of bias are not precisely known, but we believe they cause the 
information on number and value of offers to be underreported. 
Data 
We analyzed the survey responses by inputting them into a dBASE III (Ashton-Tate 
Corporation) data base, converting that data base to a PC-SAS data base, and using a 
variety of PC-SAS 
B-4
 TABLE 2 
. 
 of Physicians Selected for Inclusion 
Specialty  Number in  Percent of Total  Number of  Percent of Total 
Selected  Selected Sample  Respondents  Respondents 
Sample 
Internal  Medicine  175  17.5  85  14.1 
Family Practice  112  11.2  82  13.6 
General Practice  97  9.7  30  5.0 
General  Surgery  58  5.8  33  5.5
Radiology  i 52  5.2  26  4.3 
Orthopedic  Surgery  49  4.9  28  4.6 
Cardiovascular  Diseases  47  4.7  20  3.3 
Ophthalmology  45  4.5  34  5.6 
Anesthesiology  r44  4.4  27  4.5 
I  35  I 3.5  123  3.8 
Optometry  34  3.4  23  3.8 
Podiatry  30  3.0  17  2.8 
Other  222  22.2  175  28.4 
27  27  18 
chiropractic  2.5  25  12  20 
25  25  25 
21  21  18  3.0 
19  1.9  12  20 
14  I.4  11  1.8 
 Diseases  13  1.3  8  1.3 
12  9  1.5 
EENT 
Neurological Surgery 
oral 
Physical  Medicine 
Pediatrics 
B-5
 Pain  Management 
Nuclear 
 Monitoring  0  0  I  0.2 
0  0  I  0.2 
Colon/Rectal  0  0  I  0.2 
Note: Specialties of physicians sampled were determined by the BMAD coding; 
specialties of physicians responding were self-reported by the physicians. It is possible 
a physicians specialty was more specific or general in the BMAD coding than in his or 
her own coding. It is also possible that the BMAD coding is several years old and the 
physician has shifted subspecialties. 
Source: BMAD files and OIG Survey of Physicians Interactions with Pharmaceutical 
Companies, Fall 1991. 
B - 6
 TABLE 3

Comments of Responding Physicians

Paraphrased Comments  Number of  Percent of 
Respondents  Respondents 
Making  Making 
Comment  Comment 
All dealings with pharmaceutical companies have  49  8% 
been ethical and positive/Nobody has bribed me/ 
This is not a problem here 
I have little or no contact with pharmaceutical  38  6% 
companies 
-
I refuse all or most offers  17  3% 
Offers have no influence  16  3% 
This survey is a waste of time and/or money/The  15  2% 
problem is blown out of proportion 
Drug companies do excessive things and/or should  9  1% 
be controlled more 
Things have changed in the last few years/The  7  1% 
industry polices itself 
This is a witch hunt  5  1% 
Congress and other industries are just as much  5  1% 
into this and should be investigated 
I wish I were offered these things  5  1% 
Drugs cost too much money  5  1% 
Source: Comments from respondents to OIG Survey of Physicians Interactions with 
Pharmaceutical Companies, Fall 1991. 
B - 7
 APPENDIX  C
. _ 
PHARMACEUTICAL COMPANIES OFFERS OF   AND PAYMENTS 
BY SPECIALTY 
SPECIALTIES WITH TEN OR MORE RESPONDENTS 
-
Specialty  Number of  Percent offered at 
physicians  least one gift or 
payment 
Neurology  11  100% 
Internal Medicine  85  99% 
Family Practice  82  %%
--. 
Dermatology  18  94% 
Urology  18  94% 
Psychiatry  15  93% 
Oncology  11  91% 
Orthopedic Surgery  89% 
Cardiovascular  Disease  19  89% 
General Surgery  33  88% 
General Practice  30  87% 
16  87% 
Podiatry  17  82% 
Anesthesiology  27  78% 
Ophthalmology  34  56% 
Optometry  23  39% 
Radiology  26  35% 
Pathology  12  17% 
Chiropractic  12  0% 
SPECIALTIES WITH LESS THAN 10 RESPONDENTS 
Level of prescribing  Number of  Percent offered at 
physicians  least one gift or 
payment 
Low (Less than 10 prescriptions written per week)  14  71% 
Medium (Between 10 and 49 prescriptions written  29  93% 
per week) 
High (At least   prescriptions written per week)  43  95% 
Source: OIG Survey of Physicians Interactions with Pharmaceutical Companies, Fall 1991. 
C - l   APPENDIX  D

QUESTIONNAIRE

D - l    OF PHYSICIANS REGARDING 
 PHARMACEUTICAL 
All of your answers are   confidential and will be used only for the purposes 
of this study. 
We are interested in hearing about your responses to this survey.  Please call 800-
551-5154 to discuss specific promotions or to ask questions about the survey. 
BACKGROUND 
 What is your primary specialty?

B2. In what year did you receive your medical degree?

B3. Do you participate in research?  Y  N

If YES,

 What percentage of your working time do you do research?  %

 What percentage of your research is funded by pharmaceutical companies?  %

B4. Do you see patients in a hospital?  Y  N 
If YES, 
 What percentage of your working time do you spend working in hospitals? 
 What kind of hospital do you most often work in? 
1. Academic medical center 
2. Community teaching hospital 
3. Community non-teaching hospital 
B5. Do you see patients in private practice?  Y N  
 If YES, is it a group practice?  Y N  
B6. Are you a salaried employee of an HMO?  Y N  
B7. How many patients do you see per week? 
B8. How many prescriptions for drugs do you write per week? 
D - 2
 Promotion 
Please indicate which of the following have been offered to you by pharmaceutical companies 
in the last 12 months and, if the offer has been extended, answer the questions in columns B 
and C. 
A.  B.  C.  D. 
OFFER  Was this  On how  What was  How many 
offered to  many  the total  offers, as a 
you in the  occasions  approxi- condition for 
last 12  was this  mate value  receiving 
months?  offered to  of these  them, re
you?  offers?  quired you to 
prescribe a 
manufact
urers drug? 
 Small gifts (i.e. pens,  YES  NO 
prescription pads, etc.) 
P2. Meals or drinks  YES  NO 
P3. Entertainment or sporting event  YES  NO 
tickets 
P4. Medical texts  YES  NO 
P5. Medical equipment  YES  NO 
P6.   equipment  YES  NO 
P7. Pharmaceutical samples for  YES  NO 
personal/family use 
P8. Other items for personal/family  YES  NO 
use 
P9. Gifts of money  YES  NO 
D - 3
 Research and Information Gathering Activities 
Please indicate which of the following have been offered to you by pharmaceutical companies 
in the last 12 months and, if the offer has been extended, answer the questions in columns B, 
C, and D. 
OFFER  A.  B.  D. 
Was this  On how  What is the  For how 
offered to  many  approxi many of 
you in the  occasions  mate value  these offers 
 12  was this  of the  was your 
months?  offered to  offers?  compensation 
you?  dependent on 
the number 
of 
prescriptions 
you wrote? 
 Compensation for supervising or  YES  NO

conducting clinical trials on 
experimental drugs not yet approved 
by FDA 
STUDIES ON FDA-APPROVED DRUGS

R2. Compensation for conducting   N O  
studies which required recording 
demographic information, but did 
not require recording clinical 
information 
R3. Compensation for conducting  YES  NO 
studies which required recording 
clinical information 
R4. Compensation for conducting  YES  NO 
studies (including those in R2. and 
 which required prescribing the 
drug being studied to people who 
were not previously taking it. 
 Compensation for participating  YES  NO  sp  -
in focus group sessions 
D - 4   Educational Programs 
Please indicate which of the following have been offered to you by pharmaceutical companies 
in the last 12 months and, if the offer has been extended, answer the questions in columns B, 
C, and D. 
A.  B.  C.  D. 
OFFER  Was this  On how  What was  How many 
offered to  many  the  of these 
you in the  occasions  approxi- programs 
 12  was this  mate value  offered 
months?  offered to  of the  continuing 
you?  offers?  medical 
education 
credits for 
those who 
attend? 
El. Travel and/or accommodation  YES NO 
expenses for you to go to out of 
town programs at which you were 
not a presenter   sires) 
E2. Travel and/or accommodation  YES  NO 
expenses for a spouse or companion 
to accompany you to educational 
programs at which you were not a 
presenter 
E3. Cash honoraria for attending  YES  NO 
educational programs at which you 
were not a presenter (regardless of 
location) 
E4. Other gifts, tickets and  YES  NO 
hospitality for attending educational 
programs at which you were not a 
presenter (regardless of location) 
 Travel/accommodation expenses  YES  NO 
and/or honoraria for making 
presentations at educational 
programs  Pharmaceutical  ampk? 
Below WC  samples you have received in the last twelve months.
Please indicate whether or not you have received samples.  If you have, please indicate whether

or not you have been required to request these samples in writing and confirm their receipt.

A.  B. 
Within the last 12 months,  On how many of these 
on how many occasions do  occasions do you recall 
you recall having received  having signed written 
samples?  requests/ written 
confirmations of   for 
these samples? 
 Samples obtained at 
professional meetings 
S2. Samples delivered to your 
office by a companys 
representative 
S3. Samples delivered to your  requests  receipts 
home or  by mail/common 
carrier 
Additional Comments 
Thank you for completing our survey. If you have any additional comments you would like to 
make or there were other offers that were not covered in our brief survey that you would like 
to inform us of, please do so here. Remember: To tell us your feeling about offers from 
pharmaceutical   to discus specific offers, or to ask questions about the survey, 
please   (800) 551-5154. 
Comments: 
D - 6
 A P P E N D I X   E

DETAILED  COMMENTS ON THE   REPORT

In this appendix, we present in full the comments on the draft report offered by the 
Assistant Secretary for Health, the American Medical Association, the Pharmaceutical 
Manufacturers Association, the Accreditation Council for Continuing Medical 
Education, and the Public Citizen Health Research Group. 
E - l   DEPARTMENT OF HEALTH   HUMAN 
Public   Service 
Memorandum

Assistant  Secretary  for  Health 
from 
Office  of  Inspector  General    Draft  Report  Promotion  of
Subject	
Prescription  Drugs  Through  Payments  and  Gifts:  Physicians
Perspectives  OEI-01-90-00481 
To 
Inspector  General,  OS 
Attached  are  the  PHS  comments  on  the  subject  OIG  draft  report.
We  concur  with  the  reports  recommendation  to  PHS.  Our 
comments  outline  the  actions  being  taken  to  implement  it. 
  Mason,  M.D.,  Dr.P.H. 
m
Attachment  PUBLIC   SERVICE   COMMENTS ON THE OFFICE OF 
INSPECTOR GENERAL   DRAFT REPORT "PROMOTION OF 
 THROUGH PAYMENTS AND GIFTS: 
'  PERSPECTIVES,"  OEI-01-90-00481 
OIG Recommendation 
The Public Health Service (PHS),  through the Food and Drug
Administration (FDA),  should finalize guidelines defining what
it considers promotional activity and what it considers 
scientific interchange. 
PHS Comment 
We concur.  The PHS agrees that the FDA should provide guidance
to pharmaceutical companies on the distinction drawn by the FDA 
between promotional activities and independent scientific 
exchange. 
The FDA's Center for Drug Evaluation and Research's (CDER) 
Division of Drug Marketing, Advertising, and Communications, 
began this process in October 1991.  At that time, the CDER 
issued in draft a paper entitled "Drug Company Supported 
Activities in Scientific or Educational Contexts:  A 
Concept Paper."  The paper addresses the FDA's regulation of
promotional activities that occur in scientific or educational 
settings. 
The CDER requested and received comments on the draft paper 
from the pharmaceutical industry, medical community, other 
government agencies,  and the general public.  The comments have 
been evaluated and the concept paper has been presented to the 
Deputy Commissioner for Policy.  The FDA's Deputy Commissioner
for Policy is continuing the process of developing a policy 
guidance document in consultation with the Office of the 
Assistant Secretary for Health,  We expect that the policy
guidance will be finalized and published in Fiscal Year 1993. 
Technical Comments 
Paqe 3, Second Bullet, First   and Paqe 4, Table 
"Offers from Pharmaceutical Companies to 
We noted the inconsistencies between the means and the median 
scores,  on many of the measures reported on pages 3 and 4. In
order to improve the clarity of the report, we suggest that the 
OIG address these inconsistencies and also discuss the 
potential significance of the positive skew in the 
distribution.  Letter  to  Richard  P. 
Page 2 
expenses  to  physician6  to  attend  speakers'  training  programs  or  to  students, 
residents  and  fellows  to  attend  educational  conferences.  In  view  of  the 
frequency  with  which  physicians  were  offered  pharmaceutical  samples  for 
personal  use,  we  will  address  the  propriety  of  that  gift  as  well. 
We  welcome  the  opportunity  to  continue  working  with  you  in  addressing  the 
concerns  raised  by  gifts  from  industry  to  physicians. 
  S.  Todd,  MD  American  Medical  Association 
Physicians dedicated   the   of America 
James S. Todd, MD  515   state street  312 
Executive Vice President   60610 
June  4,  1992 
Richard  P.  Kusserow 
Inspector  General 
Department  of  Health    Human  Services 
330  Independence  Avenue,  SW,  Room  5250 
Washington,  DC  20201 
Re:	 Promotion  of  Prescription  Drugs  Through  Payments  and  Gifts: 
Physicians  Perspectives 
Dear Mr. Kusserow: 
Thank  you  for  the  opportunity  to  comment  on    draft  report  of  the  Office  of 
Inspector  General. 
The  OIG  study  of  gifts  to  physicians  from  the  pharmaceutical  industry  is  a 
very  important  one.  There  are  still  inadequate  data  on  the  gift-giving 
practices  of  industry. 
Overall,  we  are  encouraged  by  the  survey  results.  For  the  most  part,  industry 
and  the  profession  appear  to  be  complying  with  the  American  Medical 
Associations  guidelines  on  gifts  from  industry.  For  example,  only  1%  of 
physicians  reported  offers  of  gifts  of  money ;  only  6%  of  physician6  reported 
offers  of  entertainment  or  Sporting  event  tickets.  In  addition,  the  data 
reported  would  tend  to  underestimate  the  degree  of  compliance.  The  period 
covered  by  the  study  began  before  the  guidelines  were  issued,  and  there  was  a 
transition  period  of  several  months  before  the  guidelines  were  fully  in 
effect.  We  believe  that  the  joint  efforts  of  the    and  the  Pharmaceutical 
Manufacturers  Association  provide  an  excellent  model  of  self-regulation. 
We  agree  that  the  guidelines  do  not  always  give  specific  enough  guidance. 
Consequently,  in  October  1991,  we  issued  a  several-page  document  with 
clarifications  of  the  guidelines.    interpretive  document  provides  answers 
to  more  than  thirty  common  questions  about  the  guidelines.  The  interpretive 
process  is  on-going; we  plan  to  issue  clarifications  on  several  other 
questions  in  the  coming  months,  including  the  ones  mentioned  in  your  draft 
* 
report.  In  particular,  clarifications  will  be  issued  on  when  compensation  is 
appropriate  for  participation  in  a  market  focus  group  or  in  clinical  trials. 
We  will  also  indicate  more  specifically  when  it  is  permissible  to  pay  travel  2

Paqe 5,  om  ---r -- -  in Appendix C
The OIG draft report makes reference to the "gifts by

specialty" breakouts.   of the high percentages appear

questionable because they are based on one or two individuals

in each category.  To mitigate this problem, the OIG should

determine whether there are data that would allow the

specialties to be combined as a function of frequency of

prescribing.  We believe a combined table would make a better

presentation.

Paqe 9, First Paraqraph, Second Sentence

We believe the phrase,  "prior to the guidelines' development,"

should be changed to "prior to the guidelines' promulgation."

This would clarify that the offers under question took place,

before or after the issuance of the guidelines and not during

the development of the guidelines.

Appendix   Paqe B-2, Paraqraph Under "Profile of Respondents" 
The percentage reported as undeliverable (or ineligible) in the 
original sample is misleading.  The sentence states "Of the 38 
percent who did not respond . . ..B percent, were returned as 
. . . .  In fact,  the number represents   percent of the total; 
21 percent of the 380 non-responses. 
Pase B-2, Paraqraph Under  "Potential  Biases"

We believe the OIG should address that these data are subject

to a recall bias that would overemphasize the physicians' most

recent experiences and underemphasize their experiences in the

early part of the period covered.  Accurate recall of events

drops precipitously after 2 weeks.  Therefore,  the physicians

were probably more likely to recall their latest experiences

with pharmaceutical company offers, which took place subsequent

to dissemination of the quidelines.  This is a factor which

would be likely to bias the data in favor of underreporting

both the number and value of any offers made.

 B, 
Although there is a brief discussion of potentially biasing

factors in the methodology appendix, we are concerned that most

of the readers of these reports would not read the appendices

and the discussion may be lost.  We believe that it would be

worthwhile to discuss in the text of the report the likelihood

that offers were underreported because those who received the

most (and/or most valuable) offers were likely to be

overrepresented in the non-respondent category.  The specialty

breakout offered does not address this more general issue.
 c.  May  contributions  to  a  professional  societys  general  fund  be  accepted 
from  industry? 
The    to  deal  with  gift6  from  industry  which 
affect,  or  could  appear  to  affect,  the  judgment  of  individual 
practicing  physicians.  In  general,  a  professional  society 
make  its  own  judgment  about  gift6  from  industry  to  the  society 
itself. 
d.	 When  companies  invite  physician6  to  a  dinner  with  a    what  are 
the  relevant  guidelines? 
First,  the  dinner  must  be  a    meal.  Second,  the  guideline  does 
allow  gift6  that  primarily  benefit  patients  and  that  are  not  of 
substantial  value.  Accordingly,  textbook6  and  other  gift6  that 
primarily  benefit  patient  care  and  that  have  a  value  to  the  physician 
in  the  general    of  $100  are  permissible. 
e.  May  physicians  accept	 vouchers  that  reimburse  them  for  uncompensated 
care  they  have  provided? 
No.  Such  a  voucher  would  result  directly  in  increased  income  for  the  I   
f.  May  physicians  accumulate  points  by  attending  several  educational  or 
promotional  meetings  and  then  choose  a  gift  from  a  catalogue  of 
  options? 
  guideline  permits  gifts  only  if  they  are  not  of 
value.  If  accumulation  of  points  would  result  in  physicians 
receiving  a  substantial  gift  by  combining  insubstantial  gifts  over  a 
relativeiy  short  period  of  time,  it  would  be  inappropriate. 
  accept  gift  certificates  for  educational  materials 
attending  promotional  or  educational  events? 
The  Council  views  gift  certificates  as  a  grey  area  which  is  not 
  prohibited  by  the  guidelines.  Medical  text  book6  are  explicitly 
approved  as  gifts  under  the  guidelines.  A  gift  certificate  for 
educational  materials,  i.e.,  for  the  selection  by  the  physician  fror 
an  exclusively  medical  text  book  catalogue,  would  not  seem  to  be 
materially  different.  The  issue  is  whether  the  gift  certificate 
gives  the  recipient  such  control  as  to  make  the    similar 
to  cash.  As    table  donations,  pre-selection  by  the  sponsor 
removes  any  quest  ion.  It  is  up  to  the  individual  physician  to 
the f   . 
  gifts  of  minimal  value  are  permissible  as  long  as 
gifts  are  related  to  the  physicians    (e.g.,  pens  and  notepads). 
Subsidies  tc  underwrite  the  costs  of  continuing  medical 
education  conferences  or  professional  meetings  can  contribute  to  the 
improvement  of    are  permissible.  Since  the  giving  American Medical 
 the health 
Annotated  Guidelines  on  Gifts  to  Physicians  from  Industry 
Council  on  Ethical  and  Judicial  Affair6

American  Medical  Association

Chicago,  Illinois

Final  Version 
Issued  October  9,  1991  k.  May  continuing  medical  education  conference6  be  held  in  the  Bahamas, 
Europe  or  South  America? 
There  arc  no  on  the  location  of  conferences  as  long  as 
the  attendee6  are  paying  their  own  travel 
1.  May  travel  expenses  be  accepted  by  physicians  who  are  being  trained  as 
  or  faculty  for  educational  conference6  and  meetings? 
In  general,  no.  If  a  physician  is  presenting  a6  an  independent  expert 
at  a  event  both  the  training  and  it6  reimbursement  raise  questions 
about  independence.  In  addition,  the  training  is  a  gift  because  the 
  role  is  generally  more  analogous  to  that  of  an  attendee 
than  a  participant  .  Speaker  training    can  be  distinguished 
from  meetings  (See  with  leading  researchers,  sponsored  by  a 
company,  designed  primarily  for  an  exchange  of  information  about 
important  development6  or  treatments,  including  the    own 
research,  for  which  reimbursement  for  travel  may  be  appropriate. 
m.  What  kinds  of  social  event6  during  conference6  and  meetings  may  be 
subsidized  by  industry? 
Social  events    satisfy  three  criteria.  First,  the  value  of  the 
event  to  the  physician  should  be  Second,  the  event  should 
facilitate  discussion  among  attendee6  and/or  discussion  between 
attendees  and  faculty.  Third,  the  educational  part  of    conference 
should    for  a  substantial  majority  of  the  total  time  accounted 
for  by  the  educational  activities  and  social  event6  together.  Events 
that  would  be  viewed  (as  in  the  succeeding  question)  as  lavish  or 
expensive  should  be  avoided.  But  modest  social  activities  that  are 
not  elaborate  or  unusual  are  permissible,  e.g.,  inexpensive  boat 
rides,  barbecues,  entertainment  that  draw6  on  the  local  performers. 
In  general,  any  such  events  which  are  a  part  of  the  conference  program 
should  be  open  to  all  registrants. 
n.  May  a  company  rent  an  expensive  entertainment  complex  for  an  evening 
during  a  medical  conference  and  invite  the  physicians  attending  the 
conference? 
NO.  The  guidelines  permit  only  modest  hospitality. 
o.  If    attending  a  conference  engage  in  interactive  exchange, 
their  travel  expenses  be  paid  by  industry? 
NO.    interactive  exchange  would  not  constitute  genuine  consulting 
 ces . 
If  a  company  schedules  a  conference  and  provides  meals  for  the 
attendees  that  fall  within  the  guidelines,  may  the  company  also  pay  the 
costs  of  the  meals  for  spouses? 
If  a  meal  falls  within  the  guidelines,  then  the  physicians  spouse  ma! 
be  included.  of  a  subsidy  directly  to  a  physician  by  a  companys  sales  representative  may 
create  a  relationship  which  could  influence  the  use  of  the  companys  products, 
any  subsidy  should  accepted  by  the  conferences  sponsor  who  in  turn  can  use 
the  money  to    registration  fee.  Payments  to  defray  the 
costs  of  a  conference  should  not  be  accepted  directly  from  the  company  by  the 
physicians  attending  the  conference. 
a.  Are  conference  subsidies  from  the  educational  division  of  	a  company 
covered  by  the  guidelines? 
Yes.  When  the  Council  says  any  subsidy,  it  would  not  matter 
whether  the  subsidy  comes  from  the  sales  division,  the  educational 
division  or  some  other  section  of  the  company. 
b.	 May  a  company  or  its  intermediary  send  physicians  a  check  or  voucher 
to  offset  the  registration  fee  at  a  specific  conference  or  a  conference  of 
the  physicians  choice? 
Physicians  should  not  directly  accept  checks  or  certificates  which 
would  be  used  to  offset  registration  fees.  The  gift  of  a  reduced 
registration  should  be  made  across  the  board  and  through  the 
accredited  sponsor. 
deline.  Subsidies  from  industry  should  not  be  accepted  directly  or 
indirectly  to  pay  for  the  costs  of  travel,  lodging  or  other    expenses 
of  physicians  attending  conferences  or  meetings ,  nor  should  subsidies  be 
accepted  to    for  the  physicians  time.  Subsidies  for  hospitality 
should  not  be  accepted  outside  of  modest  meals  or  social  events  held  as  a  part 
of  a  conference  or  meeting.  It  is  appropriate  for  faculty  at  conferences  or 
meetings  to  accept  reasonable  honoraria  and  to  accept  reimbursement  for 
reasonable  travel,  lodging  and  meal  expenses.  It  is  also  appropriate  for 
consultants  who  provide  genuine  services  to  receive  reasonable  compensation 
and  to  accept  reimbursement  for  reasonable  travel,  lodging  and  meal  expenses. 
Token  consulting  or  advisory  arrangements  cannot  be  used  to  justify 
compensating  physicians  for    time  or  their  travel,  lodging  and  other 
out-of-pocket  expenses. 
a.	 If  a  company  invites  physicians  to  visit  its  facilities  for  a  tour  or 
to  become  educated  about  one  of  its  products,  may  the  company  pay  travel 
expenses  and  honoraria?  This  question  has  come  up  in  the  context  of  a 
rehabilitation  facility  that  wants  physicians  to know of  its  existence 
that  they  may  refer  their  patients  to  the  facility.  It  has  also  come  up 
in  the  context  of  surgical  device  or  equipment  manufacturers  who  want 
physicians  to  become    with  their  products. 
In  general,  travel  expenses  should    be  reimbursed,  nor  should 
honoraria  be  paid  for  the  visiting  physicians  time  since  the 
presentations  are  analogous  to  a  pharmaceutical  companys  educational 
or  promotional  meetings.  The  Council  recognizes  that  medical  device-c, 
equipment  and  other  technologies  may  require,  in  some  circumstances, 
special  evaluation  or  training  in  proper  usage  which  can  not  f.  May  a  company  compensate  physicians  for  their  time  and  travel  expenses 
when  they  participate  in  focus  groups? 
Yes.  As    es  the  focus  groups  serve  a  genuine  and  exclusive 
research  purpose  and  are  not  used  for  promotional  purposes,  physicians 
may  be    for  time  and  travel  expenses.  The number of 
physicians  used  in  a  particular  focus  group  or  in  multiple  focus 
groups  should  be  an  appropriate  size  to  accomplish  the  research 
purpose,  but  no  larger. 
Do  the  restrictions  on  travel,  lodging  and  meals  apply  to  educational 
programs  run  by  medical  schools,  professional  societies  or  other 
accredited  organizations  which  are  funded  by  industry,  or  do  they  apply 
only  to  programs  developed  and  run  by  industry? 
The  restrictions  apply  to  all  conferences  or  meetings  which  are  funded

by  industry.  The  Council  drew  no  distinction  on  the  basis  of  the

organizer  of  the  conference  or  meeting.  The  Council  felt  that  the

gift  of  travel  expenses  is  too substantial  even  when  the  conference  is

run  by  a  non-industry  sponsor.  (Industry  includes  all  proprietary

health-related  entities  that  might  create  a  conflict  of  interest  as 
recommended  by  the  American  Academy  of  Family  Physicians.)

h.	 May  company  funds  be  used  for  travel  expenses  and  honoraria  of  bona 
fide  faculty  at  educational  meetings? 
 
This    draws  a  distinction  between  attendees  and  faculty.  As 
was  state?.,  is  appropriate  for  faculty  at  conferences  or 
meetings  to  accept  reasonable  honoraria  and  to  accept  reimbursement 
for  reasonable  travel,  lodging,  and  meal  expenses. 
Companies  need  to  be  mindful  of  the  guidelines  of  the  Accreditation 
Council  on  Continuing  Medical  Education.  According  to  those 
guidelines,    from  a  commercial  source  should  be  in  the  form  of 
an  educational  grant  made  payable  to  the  CME  sponsor  for  the  support 
of programming. 
i.  May  travel  expenses  be  reimbursed  for  physicians  presenting  a  poster 
or  a  free  paper  at  a  scientific  conference? 
Reimbursement  may  be  accepted  only  by  bona  fide  faculty.  The 
presentation  of  a  poster  or  a  free  paper  does  not  by  itself  qualify 
person  as  a  member  of  the  conference  faculty  for  purposes  of  these 
guidelines. 
When  a  professional  association  schedules  a  long-range  planning 
meeting,  is  it  appropriate  for    subsidize  the  travel  expenses 
of  the  meeting  participants? 
The  guidelines  are  designed  to  deal  with  gifts  from  industry 
affect,  or  could  appear  to  affect,  the  judgment  of  individual 
practicing  physicians.  In  general,  a professional society 
shouid 
its    judgment  about  gifts  from  industry  to  the  society  itseif.  practicably  be  provided  except  on  site.  Medical  specialties  are  in  a 
better  position  to  advise  physicians  regarding  the  appropriateness  of 
reimbursement  with  regard  to  these  trips.  In  cases  where  the  company 
insists  on  such  visits  as  a  means  of  protection  from  liability  for 
improper  physicians  and  their  specialties  should  make  the 
judgment.  In  no  case  would  honoraria  be  appropriate  and  any  travel 
expenses  should  be  only  those  strictly  necessary. 
b.	 If  the  company  invites  physicians  to  visit  its  facilities  for  review 
and  comment  on  a  product,  to  discuss  their  independent  research  projects 
or  to  explore the potential  for  collaborative  research,  may the company 
pay  travel  expenses  and  an  honorarium? 
If  the  physician  is  providing  genuine  services,  reasonable 
compensation  for  time  and  travel  expenses  can  be  given.  However, 
token  advisory  or  consulting  arrangements  cannot  be  used  to  justify 
compensation. 
c.  May  a  company  hold  a  sweepstakes  for  physicians  in  which  five  entrants 
receive  a  trip  to  the  Virgin  Islands  or  airfare  to  the  medical  meeting  of 
their  choice? 
No.  The  use  of  a  sweepstakes  or  raffle  to  deliver  a  gift  does  not 
affect  the  permissibility  of  the  gift.  Since  the  sweepstakes  is  not 
open  to  the  public,  the  guidelines  apply in full  force. 
 
d.  If  a  company  convenes  a  group  of  physicians  to  recruit  clinical 
  or  convenes  a  group  of  clinical  investigators for  a  meeting 
to  discuss  their  results,  may  the  company  pay  for  their  travel  expenses? 
Expenses  may  be  paid  if  the  meetings  serve  a  genuine  research 
purpose.  One  guide  to  their  propriety  would  be  whether  the 
conducts  similar  meetings  when  it  sponsors  multi-center  clinical 
trials.  When  travel  subsidies  are  acceptable,  the guidelines 
emphasize  that  they  be  used  to  pay  only  for  reasonable  expenses. 
The  reasonableness  of  expenses  would  depend  on  a  number  of 
considerations.  For  example,  meetings  are  likely  to  be  problematic  if 
overseas  locations  are  used  for  exclusively  domestic 
It  would  be  inappropriate  to  pay  for  recreation  or  entertainment 
beyond  the  kind  of  modest  hospitality  described  in  this  guideline. 
e.  How  can  a  physician  tell  whether  there  is  a  genuine  research 
 number of factors can be considered.  Signs  that  a  genuine 
purpose  exists  include  the  facts  that  there  are  (1)  a  valid  stud) 
protocol,    recruitment  of  physicians  with  appropriate 
qualifications  or  expertise,  and    recruitment  of  an  appropriate 
number  of  physicians   light of the number of study participants 
or  statistic21  evaluation.  - 7 -

9*  May  companies  donate  funds  to  sponsor  a  professional  societys  charity 
golf  tournament? 
Yes.  it  is  sensible  if  physicians  who  play  in  the  tournament  make 
BUL 
some  contribution  themselves  to  the  event. 
r.  If  a  company  invites  a  group  of  consultants  to  a  meeting  and  a 
consultant  brings  a  spouse,  may  the  company  pay  the  costs  of  lodging  or 
meals  of  the  spouse?  Does  it  matter  if  the  meal  is  part  of  the  program 
for  the  consultants? 
Since  the  costs  of  having  a  spouse  share  a  hotel  room  or  join  a  modest 
meal  are  nominal,  it  is  permissible  for  the  company  to  subsidize  those 
 ts.  However,  if  the  total  subsidies  become  substantial,  then  they 
become  unacceptable. 
Scholarship  or  other  special  funds  to  permit  medical  students, 
residents  and  fellows  to  attend  carefully  selected  educational  conferences  may 
be  permissible  as  long  as  the  selection  of  students,  residents  or  fellows  who 
will  receive  the  funds  is  made  by  the  academic    training  institution. 
a.  When  a  company  subsidizes  the  travel  expenses  of  residents  to  an 
appropriately  selected  conference,  may  the  residents  receive  the  subsidy 
directly  from  the  company? 
 
Funds  for  or  other  special  funds  should  be  given  to  the 
academic  department6  or  the  accredited  sponsor  of  the  conference.  The 
disbursement  of  funds  can  then  be  made  by  the  departments  or  the 
conference  sponsor. 
lin- 6.  No  gifts  should  be  accepted  if  there  are  strings  attached.  For 
example,  physicians  should  not  accept  gifts  if  they  are  given  in  relation  to 
the  physicians  prescribing  practices.  In  addition,  when  companies  underwrite 
medical  conferences  or  lectures  other  than  their  own,  responsibility  for  and 
control  over  the  selection  of  content,  faculty,  educational  methods  and 
materials  should  belong  to  the  organizers  of  the  conferences  or  lectures. 
a.  May  companies  	send  their  top  prescribers,  purchasers,  or  referrers  on 
cruises? 
No.  There  can  be  no  link  between  prescribing  or  referring  patterns 
and  gifts.  In  addition,  travel  expenses,  including  cruises,  are  not 
permissible. 
b.	 May  the  funding  company    develop  the  complete  educational 
program  that  is  sponsored    an    continuing  medical 
sponsor? 
No.  The  funding  company  finance  the  development  of  the  program 
through  its  grant  to  the  sponsor,  but  the  accredited  sponsor  must 
responsibility  and    over  the  content  and  faculty  of  conferences,  meetings,  or  lectures.  Neither  the  funding  company  nor 
an  independent  consulting  firm  should  develop  the  complete  educational 
program  for  approval  by  the  accredited  sponsor. 
c.  How  much  input  may  a  funding  company  have  in  the  development  of  a 
conference,  meeting,  or  lectures? 
The  guidelines  of  the  Accreditation  Council  on  Continuing  Medical 
Education  on  commercial  support  of  continuing  medical  education 
address  this  question. 
Any  questions  regarding  the  guidelines  should  be  directed  to  the  Council 
in  care  of: 
Kirk  B.  Johnson,  JD

General  Counsel

American  Medical  Association

 State 
Chicago,  Illinois  60610 
FAX:  312-464-5846
 Pharmaceutical 
Manufacturers 
Association 
April 17, 1992

The Honorable Richard P. Kusserow

Inspector 
Department of Health and Human Services

Washington, D.C.  20201

Dear Richard:

I appreciate the opportunity to provide the comments of

the Pharmaceutical Manufacturers Association (PMA) on the draft

report "Promotion of Prescription Drugs Through Payments and

Gifts: Physicians' Perspectives,"  Because we have many concerns

regarding this report, we were disappointed to see that this

draft has been quoted in the press.  Because the survey is flawed

methodologically, reporting of the results and conclusions, even 
tentative or speculative ones,  misleading and inappropriate. 
are 
 recommends that the report not be published.  However, if the
Inspector General's Office is under obligation to publish this 
report,   strongly recommends that the report clearly&state 
that the data do not support any firm conclusions regarding the

status of pharmaceutical marketing and promotion activities. I

am enclosing more detailed comments on the draft report, but

 major concerns are summarized below.

Briefly,   primary concerns relate to the

methodology employed for the survey.  noted in the report,
As 
the time period selected for the survey began before industry
and AMA adoption of new guidelines regarding gifts to physicians 
from industry.  Even after adoption of the guidelines, there was
an acknowledged transition period and continuing interpretation
of the new guidelines.  These additional factors are not recog
nized in the conclusions drawn in the draft report.  The response
rate to the survey, only 62 percent, raises significantly the
possibility of bias in the results,  This potential for bias, and
the inability to measure this bias reinforce our recommendation
that conclusions not be drawn from the survey results. 
We  also concerned about the way in which results   
are 
are described and interpreted in the report.  Research funding,
legitimate reimbursement for consulting services, and appropriate 
payment of travel expenses to educational events for consultant 
physicians  all described as gifts and payments--interpreted 
are 
promotional activities and combined with usual and appropriate 
as 
gifts to physicians of pens,  notepads and other reminder items. 
Moreover,  the average value of $727 for  and payments
reported is based on a highly skewed range of physician estimates
of questionable accuracy.  Most items provided to physicians fall 
2024353420 
 20005    FAX: 
- . . . . ---- . ______  .  .  .  .  __ - .  .   ___  below the  of  for   and 
criterion  $100 
are of utility in the physician's daily practice. 
We believe,  and we think   would agree, that the 
guidelines adopted by industry are working well.   and 
continue to work closely together to foster better understanding
of and adherence to these guidelines.  We are also working 
closely with FDA to ensure that their guidelines on 
funded continuing medical education programs are reasonable and
appropriate.  Representatives from both   and FDA spoke on 
these topics at a PMA meeting last week attended by more than 100

marketing executives. 
senior 
 feels that dissemination of  survey report
this 
would not be productive because of the  in the methodology
flaws 
and the lack of any basis for drawing conclusions from the survey
results.  These results do not accurately reflect the current 
state  practice in pharmaceutical marketing and promotion and
of 
could only serve to reinforce old and invalid perceptions
regarding these very necessary and useful activities. 
Sincerely,  .

Enclosure

Kirk Johnson, American Medical Association 
cc:  Detailed Comments  Office of the Inspector General's
on the 
Draft  Promotion of Prescription Drugs
 Payments and Gifts 
The   report from the Office  the Inspector General on
of 
pharmaceutical promotion through gifts and payments describes the
results of a mail survey of physicians,  In this survey physi
cians reported on instances in which gifts and payments were
offered by pharmaceutical firms during the 12 months beginning in
the fall of 1990.  The responding physicians attempted to 
estimate the value of each gift or offer. 
PMA finds serious flaws in the methodology for this survey
that cast doubt on the validity  the 
and utility of  results 
obtained.  We also believe that the way in which the results are 
summarized and interpreted in the draft report lead to highly
Speculative   conclusions.  recommends that the 
study not be released.  However,  if the report is released in 
final form, the report should not offer any conclusions, even 
speculative ones.   comments are detailed below. 
Methodoloav

The report acknowledges that the  period focused on in
time 
the survey began before   and industry adoption of new guide-
lines on industry gifts to physicians.  Consequently, it is
impossible from the survey results to assess   degree of com
pliance with the guidelines.  This is further complicated by the 
fact that   acknowledged the need for a transition period after 
adoption of the guidelines because many firms and physicians

already had contractual and financial commitments for activities

that would occur within a few months after the guidelines were

adopted.  In addition, during the first several months,   was

in the process of developing more specific interpretations of the

guidelines and subsequently provided these interpretations to the

industry in July 1991.

Mail surveys typically suffer from the problem of gaining an 
response rate.  This survey is no exception.  Only 62 
acceptable 
percent of surveyed physicians responded, thus exposing the re
sults to the potential for substantial bias.  It is not possible 
to assess adequately the degree of bias, because as the report 
states   is no information that we know about nonrespondents 
that obviously correlates with interactions with pharmaceutical
companies."  Any speculations regarding the direction of the bias 
are just that, speculation. 
The survey questionnaire asked physicians to estimate the

value of offers and gifts that were received from pharmaceutical
companies.  These valuations are unreliable, yot are reported and 
analyzed in the survey report with unwarranted precision.  The 
figures provided by physicians represent a highly skewed set 
of 
data, and yet the focus of the analysis is on   averages  that are   affected by a few large estimates from 
physicians,  some of which represented payments for conducting
clinical studies unrelated to marketing and promotion.  For 
example while the average value for gifts or payments is re-
ported  the median value is only $125, just above the 
as $727, 
 established criteria for "minimal   Placing 
 intervals around such questionable averages is without any
statistical validity. 
 of Results

Marketing and promotion activities directed to physicians

are legitimate and necessary ways of bringing products to

physicians'  attention and facilitating the use of those products.

 items such as pens, notepads, and other small gifts 
serve to remind physicians of certain products, but physicians 
still are responsible for understanding how to use products
appropriately.  In addition, there are educational activities 
that pharmaceutical firms undertake to increase physicians'
understanding regarding the use of products.  Physicians 
also sometimes asked to participate as consultant6 in marketing
research activities or in clinical studies that   outside the 
realm of marketing and promotion.  All of these items   acti
vities are combined in the analysis of the survey results and 
implicitly interpreted as gifts and payments provided by com
panies in an effort to influence physician prescribing.  The data 
are presented and interpreted in a way that infers inappropriate
activities by pharmaceutical companies. 
Compensation to physicians for participation in clinical
studies should  be aggregated with other results from the 
not 
survey.  As noted above, these amounts are largely the reason 
for the degree to which the combined results are unrepresenta
tive of the skewed nature of the data collected.  Similarly, 
physicians are asked to and do participate in marketing research 
activities such as focus groups and are often compensated for
their services.   of these figures in overall averages 
also tends to skew the aggregate results from the survey. 
All of the interpretations in the report are tentative and 
qualified in  way.  In fact, the survey results provide no  * 
some 
clear evidence that any guidelines or regulations were exceeded
by any of the activities reported by physicians.  The report 
unfortunately speculates that such excesses may have occurred 
without any basis for such speculation.  PMA recommends that all 
such speculations be eliminated and believes that the only firm
conclusion that may be drawn from this study is that the data are
not conclusive in any way.  *  Accreditation    for 
Continuing Medical Education 
P. 0. Box 245  51-B   Terrace   IL  (708)  FAX   (708) 
organizations 
individual physicians 
American Board o/Medical Specialties  Medical Association
 Council of Medical Specialty 
One Rotary Center.   805   N. State St.
  Box 70

 IL 60201  Chicago. IL 60610
 Lakt Forest, IL 
 Association  Association for Hospital Medical Education
 of   Medical Boards of   US., Inc. 
 N   Connecticut   N.W.
  707

IL   LX 20036
 Fort Worth.   76102

Association of American Medical Colleges

2450 N Street, N.W.

Washington. DC 20037
 DRAFT  DRAFT 
Accreditation Council for Continuing Medical Education 
STANDARDS  FOR  COMMERCIAL  SUPPORT  OF 
CONTINUING  MEDICAL  EDUCATION 
PREAMBLE 
The purpose of continuing medical education (CME) is to enhance the 
physicians ability to care for patients. It is the responsibility of the accredited 
sponsor of a CME activity to assure that the activity is designed primarily for 
that purpose. 
Accredited sponsors often receive financial and other support from non-ac
credited commercial organizations. Such support can contribute significant
 to the quality of CME activities. The purpose of these Standards is to de-
scribe appropriate behavior of accredited sponsors in planning, designing, 
implementing, and evaluating certified CME activities for which commercial 
support is received. 
STANDARDS 
1.  General  Responsibilities  of  Accredited  Sponors 
Accredited sponsors are responsible for the content, quality and scientific 
integrity of all CME activities certified for credit. identification of continu
ing medical education needs, determination of educational objectives, 
and selection of content, faculty, educational methods and materials is 
the responsibility of the accredited sponsor. Similarly, evaluation must be 
designed and performed by the accredited sponsor. 
a. Basic Design Requirements for CME Activities 
In designing educational activities, the accredited sponsor must as-
sure that the activities have the following characteristics: They must 
be free of commercial bias for or against any product; If the activities 
are concerned with commercial products, they must present objective 
information about those products, based on scientific methods gener
ally accepted in the medical community. 
b. I	 ndependence of Accredited Sponsors 
The design and production of educational activities shall be the ulti
mate responsibility of the accredited sponsor. Commercial 
1 of5  DRAFT  DRAFT 
2.  Enduring  Materials 
The  sponsor is responsible for the quality, content, and use of 
enduring materials for purposes of CME credit. (For the definition, see 
ACCME Standards for Enduring Materials.) 
3.  	   Products,  Reporting  on  Research,  and  Discussing 
Unlabeled Uses of Products 
a Generic and Trade Names 
Presentations must give a balanced view of therapeutic options. 
Faculty use of generic names will contribute to this impartiality. If trade 
names are used,   of several companies should be used rather 
than only that of a single supporting company. 
b.	 Reporting Scientific Research 
Objective rigorous, scientific research conducted by commercial com
panies is an essential part of the process of developing new pharma
ceutical or other medical products or devices.  It is desirable that direct 
reports of such research be communicated to the medical community. 
An offer by a commercial entity to provide a presentation reporting the 
results of scientific research shall be accompanied by a detailed out-
line of the presentation which shall be used by the accredited sponsor 
to confirm the scientific objectivity of the presentation. Such informa
tion must conform to the generally accepted standards of experimen
tal design, data collection and analysis. 
c. Unlabeled Uses of Products 
When an unlabeled use of a commercial product, or an investigation
al use not yet approved for any purpose is discussed during an edu
cational activity, the accredited sponsor shall require the speaker to 
disclose that the product is not labeled for the use under discussion 
or that the product is still investigational. 
4.  Exhibits  and  Other  Commercial  Activities 
a. Exhibits 
When commercial exhibits are part of the overall program, arrange
ments for these should not influence planning or interfere with the 
presentation  of  CME  activities.  Exhibit placement should not be a 
condition of support for a CME activity. 
b. C	 ommercial Activities During Educational Activities 
No commercial promotional materials shall be displayed or 
 tho same room immediately before, during, or immediately after 
3 of 5  DRAFT  DRAFT 
an educational activity certified for credit. 
c. Commercial   at Educational Activities 
Representatives of commercial supporters may attend an educational 
activity, but may not engage in sales activities while in the room where 
the activity takes place. 
5.  Management  of  Funds  from  Commercial  Sources 
a Independence of the Accredited Sponsor in the Use of Contributed 
Funds 
The ultimate decision ragarding funding arrangements for CME activi
ties must be the responsibility of the accredited sponsor. Funds from a 
commercial source should be in the form of an educational grant 
made payable to the accredited sponsor for the support of program
ming. The terms, conditions and purposes of such grants must be 
documented by a signed agreement between the commercial sup-
porter and the accredited sponsor. All support associated with a CME 
activity, whether in the form of an educational grant or not, must be 
given with the full knowledge and approval of the accredited sponsor. 
No other funds from a commercial source shall be paid to the director 
of the activity, faculty, or others involved with the supported activity. 
b. Payments to Faculty 
Payment of reasonable honoraria and reimbursement of out-of-pock
et expenses for faculty is customary and proper. 
c Acknowledgement of Commercial Support 
Commercial support must be acknowledged in printed announce
ments and brochures, however, reference must not be made to specif
ic products. 
d.  A	 ccountability  for  Commercial  Support 
Following the CME activity, upon request, the accredited sponsor 
should be prepared to report to each commercial supporter, and other 
relevant parties, information concerning the expenditure of funds 
each has provided. Likewise, each commercial supporter should re-
port  to  the  accredited  sponsor  information  concerning  their 
expenditures in support of the activity. 
6.  Commercially  Supported  Social  Events 
Commercially supported social events at CME activities should not com
pete with, nor take precedence over the educational events. 
4 of 5  DRAFT  DRAFT 
7. Policy on Disclosure of Faculty and Sponsor Relationships 
a Disclosure Policy for All   Activities 
An accredited sponsor shall have a policy requiring disclosure of the 
existence of any significant financial interest or other relationship a 
faculty member or the sponsor has with the manufacturer(s) of any 
commercial  product(s)  discussed  in  an  educational  presentation.  All 
certified CME activities shall conform to this policy. 
b. 	Disclosure in Conference Materials 
CME faculty or sponsor relationships with commercial supporters 
shall be disclosed to participants   to educational activities in brief 
statements in conference materials such as brochures, syllabi, ex
hibits, poster sessions, and also in post-meeting publications. 
 Disclosure for Regularly Scheduled 
In the case of regularly scheduled events, such as grand rounds, dis
closure shall be made by the moderator of the activity after consulta
tion with the faculty member or a representative of the supporter. 
Written documentation that disclosure information was given to partici
pants shall be entered in the file for that activity.   
8.  Financial  Support  for  Participants  in  Educational  Activities 
a. Expenses of Non-Faculty Attendees 
In connection with an educational activity offered by an accredited 
sponsor, the sponsor may not use funds originating from a commer
cial source to pay travel, lodging, registration fees, honoraria, or per
sonal expenses for non-faculty attendees.  Subsidies  for  hospitality 
should not be provided outside of modest meals or social events that 
are held as part of the activity. 
b. Scholarships for Medical Students, Residents and Fellows 
Scholarship or other special funding to permit medical students, resi
dents, or fellows to attend selected educational conferences may be 
provided, as long as the selection of students, residents or fellows 
who will receive the funds is made either by the academic or training 
institution, or by the accredited sponsor with the full concurrence of the 
academic or training institution. 
5 of 5  Buyers Up     Critical Mass   Health Research Group  Litigation 
 
Ralph Nader, Founder 
May 15, 1992

Richard P. Kusserow

Inspector General

330 Independence Ave. SW

Room 5246

Washington, DC 20201

Dear Mr.  Kusserow:

Public Citizen is not surprised by the massive scope of doctor

bribing described in your report,  'Promotion of Prescription Drugs

Through Payments and Gifts: Physicians' Perspectives," but we are

disappointed by the timidity of the report's conclusions.

In detailing the brazen efforts of pharmaceutical companies to

influence prescribing  decisions  of physicians,  you have done

American health consumers a great service. Consumers now know how

often drug companies try to bribe their doctors and what form these

bribes take.  An astounding 82 percent of surveyed physicians

reported being offered gifts and payments by the 
industry between fall 1990 and fall 1991.

Your study also highlights the failure of the   ethical

guidelines to stop the most outrageous types of bribes.  Despite

the fact that the guidelines were in effect for 10 of the 12 months

of the survey period,  27 percent of physicians surveyed still

received blantantly unethical offers of gifts from pharmaceutical

companies.  Only someone with a wild imagination could believe that

all of these abuses took place in the two months of the survey

before the guidelines were adopted. Even if half took place in this 
period,  another half represent violations of the ethical code. In

addition,  the  total  number  of  violations  is  likely  an

underestimate,  as doctors who accepted these offers might have been

ashamed to report them.

The results confirm what we have long suspected: In the

absence of a reliable enforcement mechanism, no voluntary ethical

code or set of guidelines will stop the pharmaceutical industry

from attempting to buy off doctors. At Public Citizen, we continue

2000 P Street   Washington, D.C. 20036   (202)  to receive reports of unethical gift offers -- offers that

blatantly violate the   guidelines -- now 16 months after the

voluntary code 
Unfortunately,  your report draws only two weak conclusions

from its landmark survey:  (1) The Food and Drug Administration

should "finalize guidelines defining what it considers promotional

activity and what it considers scientific interchange" and   "The

Pharmaceutical Manufacturers Association should work with the

American Medical Association to more specifically define lines of

propriety in the remaining gray areas of their guidelines."

Neither recommendation addresses the heart of the issue --

what will finally stop the pharmaceutical industry from bribing

doctors and sticking U.S.  consumers with the bill.  Even the

clearest voluntary guidelines are being flaunted today. We believe

the evidence of this failure is compelling enough to justify a role

for the federal government in protecting consumers and defending

the integrity of medicine.

Accordingly,  should recommend  modeled on

Senator Edward Kennedy's 1977 proposal to outlaw   transfer . . . 
of any gift, product, premium,  prize or other things of value" to

a doctor or pharmacist from the drug industry "if the purpose of

such transfer is to influence the prescribing,  administering or

dispensing of any such drug."  .

Mr.  you have taken the lead in exposing the

corrupting influence of pharmaceutical companies in medicine. We

hope that you will not shy away from the fight to eradicate it.

Sincerely,

Joshua M.  Sharfstein  Sidney   Wolfe, M.D.

Researcher,  Public Citizen  Director,  Public Citizen

Health Research Group  Health Research Group

-- 2
 -- A P P E N D I X   F

NOTES

1.	 The AMA and PMA allowed a transition period of a few months to allow 
already committed obligations to be carried out. 
2.	 U.S. Department of Health and Human Services, Office of Inspector General, 
Promotion of Prescription Drugs through Payments and Gifts, August 1991, 
OEI-01-90-00480. 
3.	 One observer of relationships between physicians and pharmaceutical 
companies noted the following: Whenever a physician accepts a gift from a 
drug company, an implicit relationship is established between a physician and 
the company or its representative.  Inherent in the relationship is an obligation 
to respond to the gift; this obligation may influence the physicians decision with 
regard to patient care.  M. Chren, C.S. Landefield, and T. Murray, Doctors, 
Drug Companies and Gifts, Journal of the American Medical Association 262, 
no. 24 (1989): 3448-3451. Further, the American Medical Association Council 
on Ethical and Judicial Affairs acknowledged the subtle effects of gifts: There 
is no evidence that physicians knowingly or intentionally compromise their 
patients care as a result of gifts from industry. Nevertheless, the practice of 
gift-giving may mobilize subtle influences that can result in practice patterns 
based on considerations that go beyond scientific knowledge and patient needs. 
Gifts to Physicians from Industry, American Medical Association, Council on 
Ethical and Judicial Affairs, Report G, Adopted 
4.	 The American Medical Association guidelines on gifts from industry, which 
were fully adopted by the Pharmaceutical Manufacturers Association state that 
Some gifts that reflect customary practices of industry may not be consistent 
with principles of medical ethics (see appendix A for the complete text). 
5.	 Observers such as the AMAs general counsel note dramatic effects of the 
guidelines in positive respects: As a general rule, today, unlike this time last 
year, physicians are not receiving substantial inducements -- in forms of travel, 
lodging, and cash -- to attend either educational or promotional events which 
are funded by drug companies. C. Culhane,   But AMA, PMA Say 
Guidelines Working, American Medical News (September 2, 1991): 3. In 
contrast, Consumer Reports cited efforts by the pharmaceutical industry to 
comply with the letter but not the spirit of the guidelines: Consulting firms who 
design and run campaigns for drug companies are even placing ads in trade 
publications bragging of their ability to put on sales-boosting dinner meetings 
that comply with the AMA rules.  Pushing Drugs to Doctors, Consumer 
Reports, February 1992, 89. 
F - l   6.   of December 27, 1991, 55 of the calls to the hotline have generated 
information   as possible investigative leads into inappropriate or illegal 
advertising   promotional practices.  Snitchline Proves Professionals Want to 
Talk to FDA   Not Just about Ads,  Newsletter, January 13, 1992, 4-5. 
7.  The 95 percent confidence interval around these estimates are 79 percent to 85 
percent and 75 percent to 83 percent. 
8.  Based on 460 physicians who answered the question. The 95 percent 
confidence interval around this estimate is 24 to 32 occasions. 
9.  The 95 percent confidence interval around the percent offered gifts and 
payments other than small gifts is 67 percent to 75 percent; the 95 percent 
confidence interval around the number of occasions is 10 to 16. 
10.  Based on 460 physicians who answered the question. The mean value was 
$727, but this was clearly skewed by some very high values. Accordingly, the 95 
percent confidence interval around the mean is $457 to $1,013. We feel the 
median more accurate describes the central value of the offers. 
11.  Again the mean was skewed by some high values. The 95 percent confidence 
interval around the mean is $24 to $66. 
12.  We tested the hypothesis that physicians who write 50 or more prescriptions 
per week were as likely as physician who write less than 50 prescriptions per 
week to be offered a payment or gift on at least one occasion. We rejected this 
hypothesis because the chi-square value was 50 at 1 degree of freedom. 
13.  Council on Ethical and Judicial Affairs, Gifts to Physicians from Industry, 
Journal of the American Medical Association 265, no. 4 (1991): 501. 
14.  Focus group sessions pose this issue particularly pointedly. Pharmaceutical 
manufacturers often hire marketing consultants to organize and gather focus 
groups to discuss the marketing plans for a new or existing drug. These focus 
groups consist of several physicians who are paid for their time. The physicians 
are asked to judge the relative effectiveness of various sets of marketing 
material. Meanwhile, they are being given a variety of messages about the 
effectiveness and power of the drug in the material. It is not clear whether this 
type of consulting arrangement is token or not, probably not even to the 
physician involved. It could very well be that these sessions have dual 
purposes: (1) to provide direct marketing to the physician and (2) to get some 
advice on marketing plans. 
15.  We asked physicians whether they had been offered entertainment or sporting 
event tickets, pharmaceutical samples for personal/family use, and other items 
for personal/family use. We question whether the pharmaceutical samples for 
F - 2   personal/family use fall within the   guidelines and for that reason 
did not include them in this analysis. 
16.  The 95 percent confidence interval on the overall proportion of physician 
extended at least one offer defined by the guidelines as inappropriate is 23 
percent to 31 percent. 
17.  The rate of offers was significantly lower for physicians who prescribe less 
frequently. For example, the chi-square comparing rates for physicians who 
write less than 5 prescriptions a week to physicians who write at least 5 was 10 
with 1 degree of freedom; at 10 or more prescriptions per week vs. less than 10 
per week it was 15.5 (1 degree of freedom), and at 50 or more prescriptions 
per week vs. less than 50 per week it was 22 (1 degree of freedom). 
18.  It may be that physicians did not answer this question entirely correctly, and 
that pharmaceutical companies are not offering samples for this use, but 
physicians are requesting them for this use. 
19.  See Office of Inspector General, op. cit., pp. 13-14. Other medical 
organizations are more clear about defining research funding that constitutes 
unethical behavior by their members.  The American College of Obstetricians 
and Gynecologists guidelines do not allow pharmaceutical companies to control 
the design of studies or the publishing of data. The Infectious Diseases Society 
of America disapproves of accepting research funding directly from a 
pharmaceutical company, and instead advises that funding flow through an 
institution. 
20.  See our earlier report on this issue for a description of FDAs roles and activity 
in this area. 
21.  Food and Drug Administration, Drug Company Supported Activities in 
Scientific or Educational Contexts: Draft Concept Paper, October 26, 1991. 
22.  The AMAs general counsel has stated that he perceives practices to have 
changed significantly because of the guidelines: The major gifts to physicians 
that raised the most controversy, lodging and travel to educational events are, 
for the large part, over.  T. Randall, AMA, Pharmaceutical Association for 
Solid Front on Gift-Giving Guidelines, Journal of the American Medical 
Association 265, no. 18 (May 8, 1991): 2304. 
23.  All specialties with less than 30 sampled were grouped into an Other category. 
24.  IG to Survey   on Gifts from Pharmaceutical Firms, Medicare 
Compliance Alert, V.3, N.9, April 29, 1991,   2. 
25.  SAS Institute Inc.,   Language Guide for Personal Computers, Version 6 
Edition. Cary, NC: SAS Institute Inc.. 1985 
F - 3   26.	 This section of the survey relates to another inspection on adherence to the 
Prescription   Marketing Act of 1987. 
F - 4
 26.	 This section of the survey relates to another inspection on adherence to the 
Prescription   Act of 1987. 
F - 4