Greater transparency for financial arrangements between pharmaceutical companies and doctors


In early 2015 the Australian Consumer and Competition Commission (ACCC) authorized a new Code of Conduct for Medicines Australia (representing the larger drug companies in Australia but not generic makers). This 18th Code Edition now includes making public all payments to doctors who speak at drug company events, payments for work on company advisory boards, and the monetary equivalent of gifts from companies to doctors for overseas and local travel, accommodation, conference registration fees and other forms of hospitality.


This move to greater transparency started back in 2009 and culminated this year with the adoption of many of the elements of the US Physician Payment Sunshine Act. Not included in the ACCC authorized Code is payments for food and drink below $120 per person. Payments associated with industry funded research trials are also not included. The payments will be published for individual doctors on a six-monthly basis on drug company websites accessible to the public.


Doctors are informed the payments will be reported and the doctor can check the payments are correct before publication. The reporting is voluntary for the year 2016 but becomes mandatory from 2017. From then on doctors not wishing to be reported would need to refuse to accept pharmaceutical company offers. Privacy concerns have been managed by making sure all doctors know that accepting these payments or gifts will result in publication of the amounts.


These changes to the Code were hard fought and controversial initially. They have been introduced to overcome perceived or potential conflict of interest concerns when substantial payments (or payments in kind) are made by drug companies to doctors and are kept hidden from public view. It is possible that the financial relationship between the doctor and the company could bias or influence the use or prescribing of pharmaceutical products. This is especially relevant given the pharmaceutical industry targets key doctor opinion leaders for these payments or gifts.


The amounts involved are significant. For example, Australian pharmaceutical companies spent $33.4 million on educational events for healthcare professionals between October 2014 and March 2015 and from 1 January 2014 to 31 December 2014 companies spent a total of $2.6 million on medical advisory board consultant fees and hospitality (1).


How these new transparency arrangements will affect the behaviour of doctors and drug companies is yet to be seen. For the medical profession I suspect that a hypothetical ‘key opinion leader’ might pause to think before accepting the business class airfare, five star accommodations, and registration fee paid offer from a drug company to attend a US or European major meeting. I anticipate that the often-perfunctory ‘Disclosures’ slide at the start of a keynote speaker’s presentation will be more closely scrutinized and will need show monetary amounts against pharmaceutical company names.


The transparency arrangements in the Code are likely to be modified over time. Already there is criticism that the threshold of reporting is set too high at $120 per person per hospitality event (2). The theory is that even small gifts influence prescribing practice. Time will tell.


It is worth noting that the policy is now being implemented. A recent invitation received from a pharmaceutical company to attend a launch of a new drug in an interstate capital city with complimentary airfares, accommodation and meals was accompanied by a request to sign consent to public disclosure of this ‘payment or transfer of value’.


Philip Morris