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 OIG’s 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 OIG’s 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 OIG’s 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 
EXECUTIVE SUMMARY

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 family’s 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
INTRODUCTION

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 President’s 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-

z35-

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 physician’s 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 physician’s 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 

physician’s 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 company’s 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 

companion’s 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 family’s 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 physician’s 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 family’s use. Yet, 

pharmaceutical companies offered 51 percent of the physicians pharmaceutical 

samples for their own or their family’s 

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 FDA’s 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 promoh’onal 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 
1

2

3

4

5

6

7

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

27

28

29

30

31

32

33

34

35

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., 

The Council on Ethical and Judicial Affair6 submits the 

following opinion to the Rouse of Delegate6 for it6 information and 

recommends that report be filed. 

GIFTS TO PHYSICIANS FROM INDUSTRY. Many gifts given to 

physicians by companies in the pharmaceutical, device and medical 

equipment industries an important and socially beneficial 

function. For example, companies have long provided fund6 for 

educational seminars and conferences. there ha6 been 

growing concern about certain gifts from industry to physicians. 

Some gifts that reflect customary practices of industry may not be 

consistent with principles of medical ethics. To avoid the 

acceptance of inappropriate gifts, physicians should the 

following guidelines: 

1. Any gift6 accepted by physicians individually should 

primarily entail a benefit to patient6 and should not be of 

substantial value. Accordingly, textbooks, modest meals and other 

gift6 are appropriate if they a genuine educational 

function. Cash payments should not be accepted. 

2. Individual gifts of minimal value are permissible a6 long 

a6 the gift6 are related to the physician’s work (e.g., pen6 and 

notepad6 

3. Subsidies to underwrite the costs of continuing medical 

education conferences or professional meetings can contribute to 

the improvement of patient care and therefrre are 

Since the giving of a subsidy directly to a physician by a 

company’6 sales representative may create a relationship which 

could influence the use of the company’6 products, any subsidy 

should be accepted by the conference’6 sponsor who in turn can use 

the money to reduce the conference’s registration fee. Payment6 to 

defray the costs of a conference should not be accepted directly 

from the company by the physicians attending the conference. 
1

2

3

4

5

6

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

29

Rep. F - page 2 

4. from not be accepted to pay for 

the cost8 of travel, or other of 

 attending or meetings, nor 

be accepted to compensate for the for 

hospitality not be accepted outside of or 

 event8 held a8 a part of a conference or meeting. It 

appropriate for faculty at conference6 or meeting6 to accept 

reasonable honoraria and to accept reimbursement for reasonable 

travel, lodging and expenses. It also appropriate for 

 who provide genuine services to receive reasonable 

compensation and to accept reimbursement for travel, 

lodging and meal expenses. Token or advisory 

arrangement6 cannot be used to justify physicians 

their time or their travel, and other out-oE-pocket 

expenses. 

5. Scholarship or other special funds to permit medical 

students, residents and to attend carefully selected 

educational conference8 may be permissible a6 long a8 the selection 

of students, residents or fellows who will receive the 

made by the academic or training institution. 

6. No gifts be accepted there are 

attached. For example, physician6 not accept if they 

are given in relation to the physician’s prescribing practices. 

addition, when underwrite medical conference8 or 

other thon their own, responsibility for and control over the 

 of content, faculty , educational method8 material8 

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 11 degrees of freedom (no significant difference at level of 

 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 physician’s 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? 

 If YES, is it a group practice? 

B6. Are you a salaried employee of an HMO? 

B7. How many patients do you see per week? 

B8. How many prescriptions for drugs do you write per week? 

YN 

YN 

YN 

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. 

OFFER 

 Small gifts (i.e. pens, 

prescription pads, etc.) 

P2. Meals or drinks 

P3. Entertainment or sporting event 

tickets 

P4. Medical texts 

P5. Medical equipment 

P6. equipment 

P7. Pharmaceutical samples for 

personal/family use 

P8. Other items for personal/family 

use 

P9. Gifts of money 

A. B. C. 

Was this On how What was 

offered to many the total 

you in the occasions approxilast 12 was this mate value 

months? offered to of these 

you? offers? 

YES NO 

YES NO 

YES NO 

YES NO 

YES NO 

YES NO 

YES NO 

YES NO 

YES NO 

D. 

How many 

offers, as a 

condition for 

receiving 

them, required you to 

prescribe a 

manufacturer’s drug? 

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, 

A. 

Was this 

offered to 

you in the 

 12 

months? 

B. 

On how 

many 

occasions 

was this 

offered to 

you? 

What is the 

approximate value 

of the 

offers? 

C, and D. 

OFFER 

 Compensation for supervising or 

conducting clinical trials on 

experimental drugs not yet approved 

by FDA 

D. 

For how 

many of 

these offers 

was your 

compensation 

dependent on 

the number 

of 

prescriptions 

you wrote? 

-

YES NO

sp 

STUDIES ON FDA-APPROVED DRUGS

R2. Compensation for conducting 

studies which required recording 

demographic information, but did 

not require recording clinical 

information 

R3. Compensation for conducting 

studies which required recording 

clinical information 

R4. Compensation for conducting 

studies (including those in R2. and 

 which required prescribing the 

drug being studied to people who 

were not previously taking it. 

 Compensation for participating 

in focus group sessions 

 NO 

YES NO 

YES NO 

YES NO 

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. 

OFFER 

El. Travel and/or accommodation 

expenses for you to go to out of 

town programs at which you were 

not a presenter sires) 

E2. Travel and/or accommodation 

expenses for a spouse or companion 

to accompany you to educational 

programs at which you were not a 

presenter 

E3. Cash honoraria for attending 

educational programs at which you 

were not a presenter (regardless of 

location) 

E4. Other gifts, tickets and 

hospitality for attending educational 

programs at which you were not a 

presenter (regardless of location) 

 Travel/accommodation expenses 

and/or honoraria for making 

presentations at educational 

programs 

A. B. C. 

Was this On how What was 

offered to many the 

you in the occasions approxi-

 12 was this mate value 

months? offered to of the 

you? offers? 

YES NO 

YES NO 

YES NO 

YES NO 

YES NO 

D. 

How many 

of these 

programs 

offered 

continuing 

medical 

education 

credits for 

those who 

attend? 
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.

 Samples obtained at 

professional meetings 

S2. Samples delivered to your 

office by a company’s 

representative 

S3. Samples delivered to your 

home or by mail/common 

carrier 

Additional Comments 

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? 

requests receipts 

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
APPENDIX 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

from Assistant Secretary for Health 

Subject Office of Inspector General Draft Report “Promotion of

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 report’s recommendation to PHS. Our 

comments outline the actions being taken to implement it. 

m Mason, M.D., Dr.P.H. 

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 

Executive Vice President 60610 

312 

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 

Association’s 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 society’s 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 ’ 

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 physician’s (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 

I 
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 physician’s spouse ma! 

be included. 
of a subsidy directly to a physician by a company’s sales representative may 

create a relationship which could influence the use of the company’s products, 

any subsidy should accepted by the conference’s 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 physician’s 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 physician’s time since the 

presentations are analogous to a pharmaceutical company’s 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 society’s charity 

golf tournament? 

Yes. BUL it is sensible if physicians who play in the tournament make 

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 physician’s 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, are misleading and inappropriate. 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. As noted in the report, 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 recognized 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 are also concerned about the way in which results 

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 are all described as gifts and payments--interpreted 

as promotional activities and combined with usual and appropriate 

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 

. . . . - 20005 �  2024353420 � FAX: --- . ______ . . . . __ - . . ___ -
below the criterion of $100 for and 

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

senior marketing executives. 

 feels that dissemination of this survey report

would not be productive because of the flaws in the methodology

and the lack of any basis for drawing conclusions from the survey

results. These results do not accurately reflect the current 

state of practice in pharmaceutical marketing and promotion and

could only serve to reinforce old and invalid perceptions

regarding these very necessary and useful activities. 

Sincerely, .

Enclosure

cc: Kirk Johnson, American Medical Association 
Detailed Comments on the Office of the Inspector General's

Draft Promotion of Prescription Drugs Payments and Gifts 

The report from the Office of the Inspector General on pharmaceutical promotion through gifts and payments describes the

results of a mail survey of physicians, In this survey physicians 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 and utility of the 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 time period focused on in

the survey began before and industry adoption of new guidelines 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 

acceptable response rate. This survey is no exception. Only 62 

percent of surveyed physicians responded, thus exposing the results 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 reported as $727, the median value is only $125, just above the 

 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 activities are combined in the analysis of the survey results and 

implicitly interpreted as gifts and payments provided by companies 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 not be aggregated with other results from the 

survey. As noted above, these amounts are largely the reason 

for the degree to which the combined results are unrepresentative 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 some way. In fact, the survey results provide no 

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 

One Rotary Center. 805 

 IL 60201 

 Association 

 N 

IL 

Medical Association

 N. State St.

Chicago. IL 60610

Association for Hospital Medical Education

 Connecticut N.W.

 LX 20036

Association of American Medical Colleges

2450 N Street, N.W.

Washington. DC 20037

Council of Medical Specialty 

 Box 70

Lakt Forest, IL 

of Medical Boards of US., Inc. 

 707

Fort Worth. 76102
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 

physician’s 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-accredited commercial organizations. Such support can contribute significant­

 to the quality of CME activities. The purpose of these Standards is to describe 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 continuing 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 assure 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 generally accepted in the medical community. 

b. Independence of Accredited Sponsors 

The design and production of educational activities shall be the ultimate 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 companies is an essential part of the process of developing new pharmaceutical 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 outline of the presentation which shall be used by the accredited sponsor 

to confirm the scientific objectivity of the presentation. Such information must conform to the generally accepted standards of experimental design, data collection and analysis. 

c. Unlabeled Uses of Products 

When an unlabeled use of a commercial product, or an investigational use not yet approved for any purpose is discussed during an educational 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, arrangements 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. Commercial 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 activities 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 programming. The terms, conditions and purposes of such grants must be 

documented by a signed agreement between the commercial supporter 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-pocket expenses for faculty is customary and proper. 

c Acknowledgement of Commercial Support 

Commercial support must be acknowledged in printed announcements and brochures, however, reference must not be made to specific products. 

d. Accountability 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 report 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 compete 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, exhibits, poster sessions, and also in post-meeting publications. 

 Disclosure for Regularly Scheduled 

In the case of regularly scheduled events, such as grand rounds, disclosure shall be made by the moderator of the activity after consultation with the faculty member or a representative of the supporter. 

Written documentation that disclosure information was given to participants 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 commercial source to pay travel, lodging, registration fees, honoraria, or personal 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, residents, 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
APPENDIX 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 physician’s 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 AMA’s 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. 

7. 

8. 

9. 

10. 

11. 

12. 

13. 

14. 

15. 

 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. 

The 95 percent confidence interval around these estimates are 79 percent to 85 

percent and 75 percent to 83 percent. 

Based on 460 physicians who answered the question. The 95 percent 

confidence interval around this estimate is 24 to 32 occasions. 

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. 

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. 

Again the mean was skewed by some high values. The 95 percent confidence 

interval around the mean is $24 to $66. 

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. 

Council on Ethical and Judicial Affairs, “Gifts to Physicians from Industry,” 

Journal of the American Medical Association 265, no. 4 (1991): 501. 

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. 

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 
16. 

17. 

18. 

19. 

20. 

21. 

22. 

23. 

24. 

25. 

personal/family use fall within the guidelines and for that reason 

did not include them in this analysis. 

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. 

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). 

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. 

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. 

See our earlier report on this issue for a description of FDA’s roles and activity 

in this area. 

Food and Drug Administration, “Drug Company Supported Activities in 

Scientific or Educational Contexts: Draft Concept Paper”, October 26, 1991. 

The AMA’s 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. 

All specialties with less than 30 sampled were grouped into an Other category. 

“IG to Survey on Gifts from Pharmaceutical Firms,” Medicare 

Compliance Alert, V.3, N.9, April 29, 1991, 2. 

SAS Institute Inc., Language Guide for Personal Computers, Version 6 

Edition. Cary, NC: SAS Institute Inc.. 1985 

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26. This section of the survey relates to another inspection on adherence to the 

Prescription Marketing Act of 1987. 

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26. This section of the survey relates to another inspection on adherence to the 

Prescription Act of 1987. 

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