MedTech Europe, the European trade association representing the medical technology industries and formed in 2012 by Eucomed and EDMA, developed and adopted a new code of conduct for the interaction between medical technology companies and healthcare professionals (HCPs) and healthcare organizations (HCOs): the MedTech Europe Code of Ethical Business Practice (the Code). Now that the transition period has ended, the Code has replaced the Eucomed Code of Ethical Business Practice and the EDMA Code of Ethics. The Code will apply to all of MedTech Europe’s member companies (Member Companies). Compared to the Eucomed code, the Code introduces the following new requirements: a fifth principle (in addition to the four principles already contained in the Eucomed code), new chapters (with general requirements for events and the demonstration of products), transparency of educational grants and prohibition of direct sponsorship of HCPs for attendance of educational conferences. We note that although the formal codification of these new requirements on a European ‘code of conduct’ level is new, existing practice of many Member Companies is already in line with the new requirements set forth in the Code.
Interactions with HCPs and HCOs: general requirements
Regulating the interaction between Member Companies and HCPs and HCOs, the Code is based on two key requirements, namely (i) compliance with the applicable laws and (ii) the requirement not to exert improper influence over HCPs and HCOs.
Compliance with the applicable laws1
To prevent cherry-picking by Member Companies, in case of a discrepancy between the Code and applicable laws, the more strict requirement applies.
Determining whether improper influence has been exerted is highly subjective. Therefore, the purpose of an interaction or relationship is decisive: seemingly improper influence can be legitimized by the absence of an improper purpose and vice-versa.
Principles of the Code
Image and perception
Pursuant to the requirement not to exert improper influence over HCPs and HCOs, Member Companies should, at all times, consider the image and perception of the medical technology industry, which is new compared to the Eucomed and EDMA codes. High regard should be held of what is reflected to the public when interacting with HCPs and HCOs. In other words: appearance matters.
The interaction between Member Companies on the one hand and HCPs and HCOs on the other, must not be misused to improperly influence purchasing decisions. Likewise, the interaction must not be dependent on sales transactions or used to recommend any of the Member Companies’ products.
The interaction between Member Companies and HCPs and HCOs must be transparent in such a way that compliance with the applicable laws can be tested. In jurisdictions where no specific legislation with respect to such interaction applies, Member Companies should, nevertheless, maintain appropriate transparency by notifying the institution, the HCP’s superior or any other locally-designated competent authority. This written notification should fully disclose the purpose and scope of the interaction.
Where HCPs are engaged for services for or on behalf of a Member Company, the remuneration paid must correspond with the services performed by the HCP. Against this background, the remuneration must represent a fair market value.
DocumentationFor the services performed by an HCP for or on behalf of a Member Company, a written agreement must be in place. This agreement sets out, among others things, the services to be performed, the method for reimbursement of expenses and the remuneration paid by the Member Company. The activities covered by the agreement must be substantiated and evidenced by activity reports and similar documentation. Adequate documentation in this respect is kept by the Member Company for a reasonable period of time.
In addition to the above general principles, the Code provides for specific requirements when it comes to events organized by Member Companies for HCPs and HCOs. These requirements relate to the program of the event, its location and venue, the selection of the attendees and the compensation for their travelling. Moreover, detailed provisions are provided for in relation to arrangements with consultants, educational items and gifts and third party organized educational events. In this regard, the transparency of educational grants and the prohibition of direct sponsorship of HCPs for attendance of educational
conferences have been introduced.
The Code has entered into full force as of 2017. 2Accordingly, companies that previously abided the Eucomed and EDMA codes should amend their template agreements with HCPs and HCOs. Baker McKenzie’s multi-jurisdictional healthcare group is happy to assist.
1 E.g., laws related to (i) safety, quality and performance, (ii) advertising and promotion, (iii) data protection, (iv) anti-corruption, (v) environmental health and (vi) competition.
2 For the avoidance of doubt, Part 2 of the Code (‘The Dispute Resolution Principles’) has entered into force as of 2016.