The Sunshine Act: What Manufacturers, Clinical Professionals, And Researchers Need To Know

By Mark Gardner, MBA, JD, Associate, DuVal & Associates, PA, and Suzanne Sullivan, RN, CCRA, Manager, Clinical Research Services, NAMSA

This white paper focuses on research reporting requirements set forth under the Physician Payments Sunshine Act (Sunshine Act). The Sunshine Act was passed in 2010 as part of the Patient Protection and Affordable Care Act and became effective as of April 9, 2013. The new law requires that device, pharmaceutical, biologics, and medical supply manufacturers collect and report to the Centers for Medicare and Medicaid Services (CMS) information concerning payments to physicians and teaching hospitals, in addition to physician ownership or investment interests (Final Rule, p 9458). A “payment” includes cash or in-kind transfers of value, eg, compensation, food, entertainment, gifts, travel, consulting fees, honoraria, research funding, grants, charity, education, conference funding, stock, stock options, royalties, and licensing fees, among other things. If payments are $10 or greater, or $100 or more in aggregate per year, they must be reported (p 9485). The reporting cycle for 2013 data is complete. On September 30, 2014, CMS published the 2013 sunshine data on its Open Payments website. Anyone with an access to the internet may view the data. The next reporting deadline is March 31, 2015 for payments made during calendar year 2014.

The Sunshine Act does not bar gifts, it merely requires manufacturers to report them. Remuneration/payments that constitute an “inducement” are prohibited by the federal Anti-Kickback Statute and state law corollaries, and are not in compliance with voluntary industry codes such as those those developed by AdvaMed or PhRMA. Discerning when remuneration rises to the level of an inducement is subject to interpretation and is not the focus of this white paper. The Sunshine Act also requires that manufacturers disclose physician ownership or investment interests. Fines for non-compliance range from $1000-10,000 per occurrence for unintentional conduct and $10,000-$100,000 per occurrence for intentional conduct, with a cap of $1,150,000 per year per applicable manufacturer (p 9506, 9507). What follows are various Sunshine nuances related to research.