8/13/2019 Fact Sheet: Pharmaceutical Gift Ban

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Gift Ban and Disclosure LawC.111N - Pharmaceutical and Medical Device Manufacturer Conduct, Enacted in 2008

What is the gift ban and disclosure law?Based on thePhRMA federal code1of conduct,the law bans drug and medical device companies from giving

physicians free gifts, such as meals or entertainment, as part of their marketing practices. The gift ban law further

requires the reporting of certain payments to physicians and other prescription drug prescribers from the drug and

medical device industry. The Department of Public Health (DPH) annuallypublishesthe data from this reporting

on their website.2

Is there public support for legislation? 85% of physiciansbelieve drug reps influence decisions.

3

81% of Americansbelieve doctors should not receive free meals from drug reps.68% support disclosurelaws.4What are the true costs of pharmaceutical marketing?

Pharmaceutical companies promotional spending nearly doubles that of research and development. Health

care consumers foot the bill for industry marketing.

From 20062010, prices for the top 100 commonly used prescription drugs increased at a rate nearly double

that of the medical industryandover double the rate of general inflation.5

6

1Code of Interactions with Healthcare Professionals, PhRMA and the Advanced Medical Technology Association.2Prepared Reports, Commonwealth of Massachusetts Executive Office of Health and Human Services.

3Michael A. Steinman et al, Of principles and pens: attitudes and practices of medicine housestaff toward pharmaceutical industry promotions, The

American Journal of Medicine, Vol. 110, Issue 7, (2001).4The Prescription Project, International Communications Research (2008).

5GAO-11-306R: Prescription Drug Price Trends, U.S. Government Accountability Office (2011).

6Id., at 19, Figure 4.

7Glenn Snyder, Showdown over drug pricingget ready for another round, Deloitte(2010).

89%

11%

PharmaceuticalsMarket Share

Brand GenericsThe index value of137.7 indicates anincrease of 37.7%inthe average U&C pricefor brand-namedrugs.

The index value of90.1 indicates adecrease of 9.9%inthe average U&C price

for generic drugs.

From 2006-2010 the price of brand-name drugs increasedby 37.7%,while generics decreasedby 9.9%.

___ Brand----- Generic

http://www.mass.gov/eohhs/provider/licensing/programs/pharm-code-of-conduct/data/prepared-reports.htmlhttp://www.mass.gov/eohhs/provider/licensing/programs/pharm-code-of-conduct/data/prepared-reports.htmlhttp://www.mass.gov/eohhs/provider/licensing/programs/pharm-code-of-conduct/data/prepared-reports.htmlhttp://www.mass.gov/eohhs/provider/licensing/programs/pharm-code-of-conduct/data/prepared-reports.html

8/13/2019 Fact Sheet: Pharmaceutical Gift Ban

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Gift Ban and Disclosure LawC.111N - Pharmaceutical and Medical Device Manufacturer Conduct, Enacted in 2008

Myths Facts Supporting Data

The gift ban is

hurting the

restaurant industry.

Restaurant revenues

are up.

According to the Department of Revenue, restaurants are on trackto have their best year ever in 2012, and revenues are up more

than $25 million so far over 2011. Overall restaurant revenues for

2011 were up more than $33 million over 2010 numbers.8Fine

dining declines in 2009 were nationwide, not triggered by the gift

ban.9

The gift ban is

hurting the

convention industry.

Massachusetts is

gearing up for its

biggest convention year

to date.

Well over 50 medical eventsare scheduled in Massachusetts for

2012. The BCEC is expanding in anticipation of the largest

convention year to date, including the worlds largest biotech

conference, Biotechnology International Organization (BIO),

coming to Boston in June, 2010.

The gift ban is

stymying innovation.

Massachusetts is a

leader in biotech

production.

Massachusetts-based companies account for 10% of the U.S.

drug development pipelineand 5% of the global pipeline.10

Biotech employment is

booming.

Despite the 2009 downturn, biotech employment grew 4% in 2010

a 53% growth since 2001. According to the Bureau of Labor

Statistics,11MA leads the nation in biotech R&D

employment, with almost twice the concentration of jobs as the

next closest state.12

The gift ban is

deterring venture

capital investment.

Massachusetts isoutpacing Silicon Valley

in biotech investment.

Massachusetts-based biotech companies attracted a record $553

million in VC investment in 2011, outpacing Silicon Valley as the

most active target for biotech venture capital in the

nation.13

Massachusetts had its

best year to date for

venture capital in 2011,

beating the 2010

historic high.

We believe Mass.-based companies raised more than $1 billion in

VC funding last year. Massachusetts companies are now getting

one-quarter of all biotech venture dollars in the country,

Robert Coughlin, president and CEO of MassBio.14

8Net Collections Table A, Monthly Report of Collections and Refunds: April 2012, Commonwealth of Massachusetts Department of Revenue (2012).

9Robin Lee Allen, Fine Food is Not Just For White-Tablecloth Restaurants Anymore, Nations Restaurant News(2009).

10Biotechnology Industry Snapshot: 2011, Massachusetts Biotechnology Council (MassBio).

11Quarterly Census of Employment & Wage (QCEW), Bureau of Labor Statistics.

12Biotechnology, supra note 9.

13bioSTATus: Winter 2012, Richards Barry Joyce & Partners, LLC.

14Lori Valigra, MassBio: Mass. Biotechs raised most venture capital in 2011, Mass High Tech(2012).