Inducement ban regarding medical devices

Introduction

On January 1 2018 the Medical Devices Act was amended to include a provision that bans improper inducements aimed at stimulating the prescription or supply of medical devices on the basis of undesirable financial incentives (Article 10h). The aim of the amendment is to enable patients to trust that healthcare professionals make decisions concerning certain devices based on legitimate grounds relating to patient care.

Article 10h was inspired by Article 94 of the Medicines Act. However, unlike the inducement ban provided for in the Medicines Act, the inducement ban provided for in the Medical Devices Act is not prescribed by European law.

The scope of the ban is broad. Article 10h applies to persons who:

• are professionally involved in the application and use of medical devices; or
• have influence in the decision-making process for the purchase of medical devices.

Such persons include doctors, dentists, nurses and buyers for healthcare institutions and insurers.

What is prohibited?

Under Article 10h of the Medical Devices Act, suppliers are prohibited from:

• making an offer that contains a forbidden inducement;
• offering the prospect of a forbidden inducement; or
• awarding a forbidden inducement.

In addition, healthcare professionals cannot make or accept an offer that contains a forbidden inducement.

What is permitted?

Not all forms of inducement are prohibited. The act allows the following exceptions:

• Remuneration is allowed if it constitutes compensation for the costs incurred in participating in an event or not charging for participation in an event. Such remuneration must not exceed the amount that is strictly necessary to participate in the event.
• Remuneration for services granted by professionals is permitted, but only where the inducement (money or goods) is reasonable and proportionate. The provided services must be relevant to the medical device supplier or healthcare professional involved with the application of the device.
• Gifts of a limited value (ie, less than €50, with a maximum of three gifts per individual healthcare professional per year) are permitted if they are relevant to the healthcare professional's practice.
• Reduced rates and bonuses relating to the purchase of medical devices are permitted.

Further, sponsoring is permitted as a general rule, although the sponsoring of individual healthcare professionals is not.

Maximum rates for remuneration of participation costs

The permitted remuneration of participation costs is not unlimited. The regulatory authority uses the to establish what costs are strictly necessary. Such remuneration is permitted only if:

• the programme structure is balanced and reasonable and includes no recreational or social activities that are unrelated to the meeting;
• the location in terms of geographical position and facilities is legitimate; and
• the costs are reasonable.

For product-related or accredited meetings organised by suppliers or meetings organised by supplier-independent third parties, such suppliers cannot contribute more than €500 per meeting per healthcare professional or more than €1,500 per year. Reimbursement has no maximum rate only if the healthcare professional pays at least 50% of the costs personally. For other meetings organised by suppliers, such supplier can contribute a maximum of €75 per meeting and €375 per healthcare professional per year.

Maximum rates for remuneration of services provided by healthcare professionals

The regulatory authority reviews inducement agreements for services granted by healthcare professionals based on the time spent and the professional's hourly or daily rate. The hourly or daily rate must be 'reasonable', as determined by the regulatory authority in accordance with the Code of Conduct Medical Devices. This code of conduct is self-regultory.

The following maximum hourly rates are considered to be in line with market practice.

Administrative fines

A violation of Article 10h of the Medical Devices Act is punishable by an administrative fine of up to €900,000 (Article 14 of the Medical Devices Act).

For further information on this topic please contact Marlou Jannink at AKD by telephone (+31 88 253 50 00) or email ([email protected]). The AKD website can be accessed at www.akd.nl.

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