Full disclosure

Transparency is here to stay in the healthcare sector. As Jaimy Lee discovers, that reality is being seen in industry efforts ranging from communicating on physician payments to becoming thought leaders.

Transparency is here to stay in the healthcare sector. As Jaimy Lee discovers, that reality is being seen in industry efforts ranging from communicating on physician payments to becoming thought leaders. 

Medtronic executives said in June 2010 that the multi-billion-dollar medical device company would voluntarily start disclosing payments it made to physicians.

The announcement, made in an exclusive in The Wall Street Journal, was the external launch of an integrated internal program that has transformed how the company operates across each of its six business units, and its research and development, finance, communications, and regulatory divisions.

While the issue of disclosure, especially among the pharmaceutical and biotechnology industries, is not new, companies are still grappling with the execution of multifaceted transparency initiatives.

Eli Lilly began voluntarily releasing information about the payments it makes to physicians in the US in 2009. Other companies, such as Pfizer and GlaxoSmithKline, provide information about their financial relationships with physicians as a result of settlements with the Department of Justice.

Edwards Life Sciences quietly started publishing its payments to US physicians in 2009.

The launch of Minneapolis-based Medtronic's initiative follows the company's decision in 2008 to post information about its grants and donations, according to Steven Cragle, senior director of corporate PR for the company.

"We are operating in a very structurally different business environment than we were even five years ago and certainly 10 years ago," he says. "You have to be responsive to that. This isn't about communications and it's not just about reputation. It's about business performance and managing your environment to ensure you're advancing your business objectives."

But the passage of the Physician Payments Sunshine Act in last year's healthcare reform package has also created a deadline for highly regulated healthcare companies to implement disclosure programs.

Companies that manufacture drugs, devices, biologics, and medical supplies will be required to report payments made to physicians that total more than $100, starting in 2013. The information will be listed in a public database. Reportable payments include cash, stock options, royalties, grants, consulting fees, gifts, entertainment, food, travel, and charitable donations.

"There's no question people embrace the legislation and the spirit of the legislation," says Gil Bashe, EVP and health practice leader at Makovsky & Company. "That conversation is complete. The challenge becomes: How practically do you do it? How do you make sure every element of your business is in harmony?"

Comms takes the lead

Although top-level executives down to R&D staff are concerned about transparency, corporate communications teams frequently take the lead in these efforts because of the need for clear internal and external communications and education programs that can provide context to stakeholders.

Cragle says the communications team is leading Medtronic's disclosure program, while Eileen Sheil, executive director of media and PR at Cleveland Clinic, sits on the medical center's innovation management and conflicts-of-interest committee.

"It really is a cross-functional, pan-enterprise effort to put in place a system based on principles and with appropriate standards and approaches that guide and condition how we are collaborating with physicians," says Cragle. "The end result is we're able to report that."

The policy for disclosure at Medtronic is similar in format to how other companies report such information.

Payments that exceed $5,000 annually in the US are reported. The information is listed on the company website in a physician registry. Physicians who partner with Medtronic receive payments in four categories: training and education, R&D, advisory services, and royalties.

The challenge, say communicators, is explaining what those categories mean to stakeholders.

"In the public eye, there's this notion that if you just make payments transparent, it makes things better," says Cragle. "But without any context about why those payments are being made and the rationale and understanding behind how the system works, it doesn't matter if you're disclosing that you paid someone $1 or $1 million."

Internally, the company discussed issues such as when it is appropriate to engage with a physician, what a contract looks like, and the limits of a relationship between Medtronic and a physician. The policy applies to each of the company's six business units - cardiac rhythm disease management, spinal and biologics, cardiovascular, neuromodulation, diabetes, and surgical technologies.

"We needed a communications strategy that would enable each individual business to communicate to its specific stakeholders," says Cragle.

Education also remains a key tactic as employees questioned the need for disclosure, the program's cost, and why Medtronic's competitors hadn't undertaken transparency initiatives.

"Even internal staff had to better understand the context," he adds. "We're doing business in a very different external environment. That's hard for companies to grasp."

The communications team developed a "cascade" strategy, working first with senior leaders - from senior directors to VPs - and providing information about how those leaders could talk to their teams.

Third-party perspective

Medtronic also created an intranet site that included brochures, positioning papers, articles on transparency, information about the company's history of transparency, and videos featuring physicians who support disclosure. Cragle says the videos acted as a "strong and effective third-party strategy" that reinforced the company's activities.

Also included in the third-party strategy is Medtronic's partnership with the Healthcare Leadership Council, a coalition of corporate healthcare executives.

In October, more than 125 people - considered thought leaders in Medtronic's perspective - attended an educational forum called the National Dialogue for Healthcare Innovation in Washington. The topic of discussion was physician and industry collaboration.

"We felt it would be far more important to have an objective third party bring together multiple stakeholders and influencers to dialogue and discuss these issues and then provide that additional context outside of what Medtronic was providing," says Cragle.

As Medtronic nears the one-year mark of the launch of the physician registry, it is re-evaluating its overall communications strategy. The goal, says Cragle, is to enhance the tools and tactics that are already in place for its disclosure program, as well as integrate related messaging into the medical technology company's ongoing communications, including the way it engages at medical meetings and with skeptics of corporate disclosure programs.

"Transparency extends beyond physician payments to all stakeholders in demonstrating that your organization is open to feedback, open to ongoing dialogue, and, where appropriate, disclosures of why we make them," he adds.

It's a sector that most agency healthcare leaders agree presents an opportunity for new business and growth. Julianna Richter, EVP at Edelman, says companies are now talking about how to address transparency and disclosure on a global scale.

"The need for transparency transcends all markets now," she notes. "In the US, there is more of an appetite for the companies that are doing things a little differently."

Under the Sunshine Act, companies will be required to report information on an annual basis, an issue APCO Worldwide SVP Bill Pierce expects journalists to cover in a similar format to financial reports. Companies have to decide what kind of information the public is looking for, and then in what format to post the information online.

"It must be very easy to navigate," he suggests. "It has to be easy to find information you're looking for."

Impact on media relations

Physician payments and how and when healthcare companies have decided to disclose this information has been closely followed by business and healthcare journalists.

AstraZeneca, which began disclosing physician payments last August, turned to its blog to provide greater context to a series of stories published by ProPublica in October.

The company posted a Q&A with Marie Martino, its US compliance officer, following the ProPublica story, to provide additional perspective to the company's participation in the story, says Tony Jewell, senior director of external communications for the US business at AstraZeneca.

"We believe the more we disclose about how we do business, the more it will build public trust," he adds.

Todd Ringler, MD of national health media relations at Edelman, says that as more companies have implemented disclosure policies, it has become tougher to manage media relations. Some clients, he adds, no longer use satellite or radio media tours as a result.

While a physician may choose to disclose to a reporter that he or she consults with a company during an interview, companies have increasingly become concerned about whether that physician should be required to disclose product benefits and side effects.

"That's when you start to see the level of concern among the companies is so great," says Ringler. "In some instances, it paralyzes the opportunity to truly engage with the public."

Laura Schoen, global healthcare practice leader at Weber Shandwick, classifies 80% of her clients as "highly conservative." She notes they are asking many more questions about the issue of conflicts of interest in a potential program.

"They worry about being the target of an investigation by the Department of Justice," she says, "but also about something that could damage their reputation and about the undesirable result of creating questions about a physician that may be an expert in an area important to them."

At Cleveland Clinic, a conflict-of-interest policy was established in 2008. The clinic, often heralded as an example of care in the US, dealt with an onslaught of media inquiries over perceived conflicts of interest with its head of cardiovascular. Now, the clinic publishes its disclosure online and requires physicians to disclose industry relationships in press releases and media interviews.

"It was critical reporters understood how this works in a complex organization that deals with complex issues," says Sheil. "When money in patient care and research is involved, it's a high-stakes situation."

The clinic also has a policy in which it does not approve promotion of its relationships with vendors. Sheil says the medical center fields up to 30 requests a month.

Yet, even as a voting member of the conflicts-of-interest committee, Sheil finds nuances of disclosure challenging.

"It's not like it fits in a box," she explains. "They have nuances and complexities that are so different from one another. The nuances could lead to a different decision, a different outcome, or a different process."

Communications professionals say that even after the Sunshine Act goes into effect, there are still opportunities for companies to position themselves as thought leaders.

"With the recession and all the things happening over the last couple of years," says Edelman's Richter, "you must make sure your employees understand and feel good about the company they work for, that it's an ethical company, one that has policies and procedures in place."

ProPublica discusses payments

ProPublica published its first set of stories in 2010 about the industry's disclosure of payments to physicians. Jaimy Lee speaks to Charles Ornstein, senior reporter at the investigative news site.

When did you start following this issue?

As companies started releasing information about their payments to physicians and other health professionals for speaking and consulting, it struck us how the information was not very easy to use. It was difficult, if not impossible, to look for trends across companies. Each company did it in its own way. There was no public, omnibus way to look at it across the industry.

What stood out to you when you started to compare the data?

We found physicians were earning quite a bit of money, not just from one company, but from a number of them. That's why we created a spreadsheet of our top earners, which aggregated the information from numerous companies. A number of pharma companies indicate on their own websites that they're picking the very top names in the field - those with extensive expertise and leadership roles. However, we found in many instances that was not the case.

Do you expect ProPublica to keep following this issue?

Based on settlements, at least three additional companies [Novartis, Allergan, and Forest Laboratories] will be providing their data. We plan to cover this issue in coming months. Both patients in clinical practice and research participants rely on physicians for impartial information. If their doctors receive funds from a company that makes a product they recommend, it's worth starting a conversation.

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