Thursday, July 8, 2010

Pharma’s Achilles’ Heel

So, how are you doing on determining your company’s fair market value calculations?

Say it ain’t so – you’re still not putting it off, are you?

Okay, as a public service, we’ll rant again. A couple of quotes to set the appropriate tone:

“The trend is clear: Enforcement activity will increasingly focus on holding individuals responsible for the legitimacy of relationships between pharma companies and the physician-consultants they engage.”

“The states are using new codified rules ‘to close their budget gaps…there is a continuing trend of enforcement actions.’”

Friends, do not ignore what is happening here: Federal and state legislators want industry to “legitimize” its relationships with Thought Leaders. Industry will literally pay the price if it does not. The old ways are out: Lawmakers want, in writing, the reasons you paid Dr. Smith, Dr. Jones, Dr. Miller, and so on, those particular fees for the particular service they provided. And they better be justified. The new motto may as well be “consistency in fee determinations.”

So, as much as you’d rather do another project, you need to set aside copious amounts of time to get a fair market system plan in place. You need to talk to departments you normally don’t deal with – you’ll be amazed at how many departments use physician consultants in myriad ways -- and gather data from far and wide, inside and outside your company.

Hiring a consultant, someone well schooled in FMV determinations, is probably a good idea. Relying on the Office of the Inspector General is no help – “they advise only that the method must be ‘reasonable.’ And remember – you are now required to post all those fees on the Web in several of the states.

Let us know how we can help you!

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