On 17 December 2015, the French National Assembly adopted a law on modernisation of the French health system (the “Public Health Law”). Key provisions will bring changes to how the pharmaceutical and medical device industries interact with HCPs, by introducing changes to the existing French anti-benefits and sunshine regulations (Articles 178 and 180 of the Public Health Law). The impact of the new law and the regulations to follow might be felt even by companies that do not sell products or services in France.
Additional reporting under sunshine regulations
The French sunshine regulations require industry to make public the existence of certain agreements with, and benefits provided to, various stakeholders in the healthcare industry. Based on a 24 February 2015 decision of the French Administrative Supreme Court, there had been debate between the authorities and industry about what needed to be disclosed and how, but the new law resolves the disagreement.
- Companies will now have to disclose fees above a certain threshold (to be established by the government) paid under agreements with HCPs and with other stakeholders.
- Industry will also need to report the purpose of the agreements in a more detailed manner, and not by generic descriptions.The specifics will be established by an implementing decree.
- The “direct” and the “final” beneficiary of the agreements will have to be reported.
Further, the re-indexing of the information disclosed by internet search engines is made possible, which will make the reported information more readily accessible to the public. Because the Public Health Law does not expressly state that the reporting requirements are to be retroactive, they can be presumed to be imposed only on a going-forward basis. Importantly, the new regulations have been challenged before the French Constitutional Court. The legal concerns at issue include:
- Disclosing the precise purpose of the agreements could lead to disclosing confidential business information;
- Disclosure of detailed personal data and the amount of the fees paid, combined with re-indexation of the information, could violate the right to privacy and business secrecy. Particularly considering the global competition in this industry, such disclosure could also harm commercial strategy (notably in highly strategic projects such as in R&D) and the exchange of such information could lead to anticompetitive practices;
- What/who is a “final” beneficiary of an agreement needs to be carefully considered, as the term could be broadly construed.
The Constitutional Court will decide on whether these provisions must be repealed within the coming month.
Reinforcement of anti-benefits regulations
Except in very limited circumstances, the anti-benefits regulations prohibit the healthcare industry from offering direct or indirect benefits of any kind to HCPs. These regulations also establish a consultative process requiring the prior opinion of professional bodies on (among other things) the fair market value of payments made to HCPs. Importantly, the anti-benefits regulations have a more limited scope than the sunshine regulations; they apply only to companies providing services or products reimbursed by the French mandatory social security regimes. Specific rules related to the promotion of pharmaceuticals also provide restrictions regarding granting of benefits. Under the newly-enacted Public Health Law, the government may – acting via an ordinance and within a year of the Public Health Law entering into force – modify the regulatory framework on the following points:
- Expanding the scope of the regulations to apply to any entity manufacturing or marketing healthcare products or healthcare services;
- Extending the range of entities covered by the prohibition on receiving benefits;
- Carving outs on benefits not subject to these regulations, and defining the conditions under which they are acceptable;
- Redefining the exceptions under which benefits can be granted, and establishing an authorisation process involving the administration or professional bodies;
- Redefining and harmonizing the criminal sanctions and/or setting up administrative sanctions in case of breach of the regulations;
- Reinforcing the means of controlling regulatory compliance and implementing sanctions.
French companies have been anticipating reinforcement of the regulations. The Public Health Law and subsequent regulatory modifications will likely significantly transform compliance obligations. In addition, if the scope of the anti-benefits regulations is harmonised to be similar to the sunshine regulations, many additional companies – possibly including foreign entities that do not sell reimbursed products or services in France – may become subject to French anti-benefits regulations.
The Public Health Law is accessible here (in French).