SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Physician Payments 
Sunshine Act of 2008’’. 
SEC. 2. QUARTERLY TRANSPARENCY REPORTS FROM MAN-
UFACTURERS OF COVERED DRUGS, DEVICES, 
OR MEDICAL SUPPLIES UNDER MEDICARE, 
MEDICAID, OR SCHIP. 
Part A of title XI of the Social Security Act (42 
U.S.C. 1301 et seq.) is amended by inserting after section 
1128F the following new section: 
‘‘SEC. 1128G. QUARTERLY TRANSPARENCY REPORTS FROM 
MANUFACTURERS OF COVERED DRUGS, DE-
VICES, OR MEDICAL SUPPLIES UNDER MEDI-
CARE, MEDICAID, OR SCHIP. 
‘‘(a) REPORTING OF PAYMENTS OR OTHER TRANS-
FER OF VALUE.—On January 1, 2009, and the first day 
of each fiscal year quarter beginning thereafter, each man-
ufacturer of a covered drug, device, or medical supply who 
provides a payment or other transfer of value, directly, 
indirectly, or through an agent, subsidiary, or other third 
party, to a physician; to an entity that a physician is em-
ployed by, has tenure with, or has a significant ownership 
interest in; or to a covered organization in which a physi-
cian has a significant professional membership interest, 
shall submit to the Secretary, in such electronic form as 
the Secretary shall require, the following: 
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‘‘(1) The name of— 
‘‘(A) the physician; 
‘‘(B) if a payment or other transfer of 
value was provided to an entity that the physi-
cian is employed by, has tenure with, or has a 
significant ownership interest in, the name of 
the entity; and 
‘‘(C) if a payment or other transfer of 
value was provided to an organization so speci-
fied in which the physician has such a signifi-
cant professional membership interest, the 
name of the organization. 
‘‘(2) The address of— 
‘‘(A) the physician’s office; 
‘‘(B) in the case of an entity required to 
be named under paragraph (1)(B), the primary 
place of business or headquarters for the entity; 
and 
‘‘(C) in the case of an organization re-
quired to be named under paragraph (1)(C), 
the primary place of business or headquarters 
of the organization. 
‘‘(3) The facility with which the physician is af-
filiated, if any. 
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‘‘(4) The value of the payment or other transfer 
of value. 
‘‘(5) The date on which the payment or other 
transfer of value was provided. 
‘‘(6) A description of the nature of the payment 
or other transfer of value, indicated (as appropriate 
for all that apply) as— 
‘‘(A) compensation; 
‘‘(B) food, entertainment, or gifts; 
‘‘(C) trips or travel; 
‘‘(D) a product or other item provided for 
less than market value; 
‘‘(E) participation in a medical conference, 
continuing medical education, other educational 
or informational program or seminar, or funded 
research (such as lab-based, epidemiology, or 
health services research) that is not a clinical 
trial; provision of materials related to such a 
conference, educational or informational pro-
gram or seminar, or research; or remuneration 
for promoting or participating in such a con-
ference, educational or informational program 
or seminar, or research; 
‘‘(F) product rebates or discounts; 
‘‘(G) consulting fees or honoraria; 
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‘‘(H) dividend, profit distribution, stock or 
stock option grant, or any ownership or invest-
ment interest held by a physician in a manufac-
turer (excluding a dividend or other profit dis-
tribution from, or ownership or investment in-
terest in, a publicly traded security and mutual 
fund (as described in section 1877(c)); or 
‘‘(I) any other economic benefit, as defined 
by the Secretary. 
‘‘(7) The purpose of the expenditure according 
to categories specified by the Secretary, such as con-
sulting, education, royalty, and research. 
‘‘(b) ANNUAL SUMMARY REPORT.—Each manufac-
turer of a covered drug, device, or medical supply that is 
required to submit information under subsection (a) dur-
ing a year shall submit a report to the Secretary not later 
than December 31 of the year that summarizes, in such 
electronic form as the Secretary shall specify, each submis-
sion of information under subsection (a) made by the man-
ufacturer during the year. The summary report shall in-
clude the aggregate amount of all transfers of anything 
of value that is less than $25, including any compensation, 
gift, honorarium, speaking fee, consulting fee, travel, dis-
count, cash rebate, or services. 
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‘‘(c) REPORTING DATE FOR APPLICABLE CLINICAL 
TRIALS.— 
‘‘(1) IN GENERAL.—Notwithstanding subsection 
(a), a payment or other transfer of value made for 
the general funding of a clinical trial described in 
paragraph (2) shall be disclosed in the first quar-
terly report after the date clinical trial information 
for such trial is required to be posted under section 
402(j)(2)(D) of the Public Health Service Act. 
‘‘(2) CLINICAL
TRIAL.—A clinical trial de-
scribed in this paragraph is an applicable clinical 
trial for which clinical trial information is required 
to be submitted under section 402(j)(2)(C) of the 
Public Health Service Act. 
‘‘(d) PENALTY FOR NONCOMPLIANCE.—Any manu-
facturer of a covered drug, device, or medical supply that 
knowingly fails to submit information required under sub-
section (a) or (b) in accordance with regulations promul-
gated to carry out such subsection, shall be subject to a 
civil money penalty of not less than $10,000, but not more 
than $100,000, for each such failure. Such penalty shall 
be imposed and collected in the same manner as civil 
money penalties under subsection (a) of section 1128A are 
imposed and collected under that section. 
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‘‘(e) PUBLIC AVAILABILITY.—Not later than June 1, 
2009, the Secretary shall establish procedures to ensure 
that the information reported under subsection (a) and the 
summary reports submitted under subsection (b) are read-
ily accessible to the public through an Internet website 
that is easily searchable, downloadable, and understand-
able. 
‘‘(f) REPORT TO CONGRESS.—Not later than April 
1 of each year beginning with 2010, the Secretary shall 
submit to Congress a report that includes the following: 
‘‘(1) The information submitted under sub-
sections (a) and (b) during the preceding year, ag-
gregated for each manufacturer of a covered drug, 
device, or medical supply that submitted such infor-
mation during such year. 
‘‘(2) A description of any enforcement actions 
taken to carry out this section, including any pen-
alties imposed under subsection (d), during the pre-
ceding year. 
‘‘(g) DEFINITIONS.—In this section: 
‘‘(1) COVERED
DRUG, DEVICE, OR
MEDICAL 
SUPPLY.—The term ‘covered drug, device, or med-
ical supply’ means any drug, biological product, de-
vice, or medical supply for which payment is avail-
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able under title XVIII or a State plan under title 
XIX or XXI (or a waiver of such a plan). 
‘‘(2) COVERED ORGANIZATION.—The term ‘cov-
ered organization’ means an organization that is in-
volved in health care financing, organization, or de-
livery. 
‘‘(3) MANUFACTURER
OF
A
COVERED
DRUG, 
DEVICE, OR MEDICAL SUPPLY.—The term ‘manufac-
turer of a covered drug, device, or medical supply’ 
means any entity— 
‘‘(A) with annual gross revenues that ex-
ceed $1,000,000; and 
‘‘(B) which is engaged in the production, 
preparation, propagation, compounding, conver-
sion, or processing of a covered drug, device, or 
medical supply. 
‘‘(4) PAYMENT
OR
OTHER
TRANSFER
OF 
VALUE.— 
‘‘(A) IN GENERAL.—The term ‘payment or 
other transfer of value’ means a transfer of 
anything of value that exceeds $25, and in-
cludes any compensation, gift, honorarium, 
speaking fee, consulting fee, travel, discount, 
cash rebate, services, or dividend, profit dis-
tribution, stock or stock option grant, or any 
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ownership or investment interest held by a phy-
sician in a manufacturer (excluding a dividend 
or other profit distribution from, or ownership 
or investment interest in, a publicly traded se-
curity or mutual fund (as described in section 
1877(c)). 
‘‘(B) EXCLUSIONS.—Such term does not 
include the following: 
‘‘(i) Product samples that are in-
tended for patients. 
‘‘(ii) A payment or other transfer of 
value made for the general funding of a 
clinical trial, other than an applicable clin-
ical trial for which clinical trial informa-
tion is required to be submitted under sec-
tion 402(j)(2)(C) of the Public Health 
Service Act. 
‘‘(iii) A transfer of anything of value 
to a physician when the physician is a pa-
tient and not acting in his or her profes-
sional capacity. 
‘‘(iv) Compensation paid by a manu-
facturer of a covered drug, device, or med-
ical supply to a physician who is directly 
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employed by and works solely for such 
manufacturer. 
‘‘(5) PHYSICIAN.—The term ‘physician’ has the 
meaning given that term in section 1861(r). 
‘‘(6) SIGNIFICANT PROFESSIONAL MEMBERSHIP 
INTEREST.—The term ‘significant professional mem-
bership interest’ means, with respect to a physician 
and a covered organization, the physician is a vol-
untary paying member of such organization or the 
physician receives professional certification through 
such organization.’’. 
SEC. 3. LIMITATION ON TAX DEDUCTIONS FOR ADVER-
TISING BY CERTAIN MANUFACTURERS OF 
DRUGS, DEVICES, OR MEDICAL SUPPLIES. 
(a) IN GENERAL.—Part IX of subchapter B of chap-
ter 1 of subtitle A of the Internal Revenue Code of 1986 
(relating to items not deductible) is amended by adding 
at the end the following: 
‘‘SEC. 280I. LIMITATION ON TAX DEDUCTIONS FOR ADVER-
TISING BY CERTAIN MANUFACTURERS OF 
DRUGS, DEVICES, OR MEDICAL SUPPLIES. 
‘‘(a) IN GENERAL.—No deduction shall be allowed 
under this chapter for any taxable year for any expendi-
ture relating to the advertising, promoting, or marketing 
(in any medium) of any covered drug, device, or medical 
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supply manufactured by the taxpayer if, during the tax-
able year, a penalty is imposed on the taxpayer under sec-
tion 1128G(d) of the Social Security Act (relating to quar-
terly transparency reports from manufacturers of covered 
drugs, devices, or medical supplies under Medicare, Med-
icaid, or SCHIP). 
‘‘(b) DEFINITIONS AND SPECIAL RULES.—For pur-
poses of this section— 
‘‘(1) COVERED
DRUG, DEVICE, OR
MEDICAL 
SUPPLY.—The term ‘Covered drug, device, or med-
ical supply’ has the meaning given such term by sec-
tion 1128G(g) of the Social Security Act. 
‘‘(2) AGGREGATION
RULES.—All members of 
the same controlled group of corporations (within 
the meaning of section 52(a)) and all persons under 
common control (within the meaning of section 
52(b)) shall be treated as 1 person.’’. 
(b) CONFORMING AMENDMENT.—The table of sec-
tions for such part IX is amended by adding after the 
item relating to section 280H the following: 
‘‘Sec. 280I. Limitation on tax deductions for advertising by certain manufactur-
ers of drugs, devices, or medical supplies.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning ending 
after the date of the enactment of this Act. 
Æ 
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