Fair Market Value (FMV) for Physician Consulting
This week we attended a very informative Global Medtech Compliance Conference (GMTCC) organised by Advamed and Medtech Europe. With the focus firmly on global convergence trends in compliance and ethical standards, there were a number of key lessons learned.
For both Advamed and MedTech Europe the focus is clear. The new Code of Ethical Business Practice is seen by both organisations as a way of ensuring that interactions between industry and HCP’s are well documented by medical device companies.
However, there remains a great deal of uncertainty around the definition and interpretation of ‘Fair Market Value’ when engaging physicians and key opinion leaders. So much so that we heard stories of HCP’s refusing direct expenses and sponsorship for attending conferences for fear of running foul of anti-bribery and corruption legislation as well as codes of practice. Clearly, better guidelines are required in order to ensure that these critical interactions continue and the innovation process is not stifled.
Do’s and Dont’s- our key recommendations
- Conduct a need assessment for the required interaction as a starting point;
- Never choose a HCP based on business generated or volume of sales placed;
- Don’t simply choose hourly or flat rate: you should determine what is practical for your organisation and what it can afford;
- Be able to justify preparation and travel time even where there are local experts in the area. Particularly where travel time exceeds procedure time;
- Long travel time should be justified and documented and should not be paid at the same rate as procedure time;
- Use 3rd party data as justification where possible;
- Investigate local rates for your physician – choose market rate over equity/fairness;
- Document any exceptions to your process;
- Operate on the presumption that information on gifts, travel and entertainment may become publically available;
- Have a written agreement specifying the services required. Ensure that your contracts with HCP’s permit disclosure if required by law or code of practice;
- Ensure that your contracts permit you to terminate or switch to a new rate/process in the event of merger or acquisition.
- Even where not required by legislation, ensure that the physician is obliged to inform their employers or superiors of the interaction.
If you require further information or specific advice in relation to FMV, please contact our office on +35391564011 or email@example.com