1. Can a pharmaceutical company provide gifts to a healthcare professional?
● PRC laws prohibit bribery offered by a pharmaceutical company to an HCP in exchange for improper benefits. Such "bribery" can be in the form of cash, gift, property, things of value, entertainment, hospitality and travel, among others.
The key factor to determine if a gift would be considered as bribery is whether or not the provision of the gift is intended to affect the HCP's impartial performance of his/her duties.
If the bribery value is over RMB100,000 (USD15,873), the pharmaceutical company and its responsible managing person may be held criminally liable. This threshold can be calculated accumulatively. For example, if the company provided briberies to various HCPs in different healthcare institutions over the past three years, and the total value of briberies is over RMB100,000, it can still be subject to criminal liability.
If the bribery is provided for the purpose of sales of products, such activities may also be investigated and covered by administrative penalties by the local Administration for Industry and Commerce, regardless of the gift value.
A bona fide courtesy gift and a gift given in acknowledgment of Chinese holidays may be allowed. However, it is generally recommend that the gift value be limited to under RMB200 (USD31.1). Although this is not a mandatory requirement, this threshold has been adopted by many MNCs, including pharmaceutical companies.
● Despite the above, if the pharmaceutical company is a member of the China Association of Enterprises with Foreign Investment R&D-Based Pharmaceutical Association Committee ("RDPAC"), the company should also comply with the code of RDPAC, i.e. Code of Practice on the Promotion of Pharmaceutical Products (2010 Revision) ("RDPAC Code").
According to the RDPAC Code:
- A pharmaceutical company is prohibited from providing cash or cash equivalents to HCPs;
- Gifts for the personal benefit of HCPs are prohibited, except for permitted "cultural courtesy gifts";
- Permitted "cultural courtesy gifts" are inexpensive gifts (with a value of no more than RMB200 [USD31.1]) not related to the practice of medicine and given on an infrequent basis in acknowledgment of the following official holidays in China: New Year, Spring Festival, Labor Day, National Day and the Mid Autumn Festival (items allowed to be provided as cultural courtesy gifts may include food, tea, flowers, plants, crafts, or locally produced products that relate specifically to one of the listed holidays);
- Items of medical utility may be offered or given free of charge occasionally, on the condition that such items are of modest value and are beneficial to the provision of medical services and for patient care. Items may include an anatomical model for use in an examination room, or medical textbooks. The value shall be no more than RMB500 (USD79.4) per item, and a pre-paid coupon or a purchase card is not allowed; and
- Promotional items may be provided to HCPs, but only if the gift is of minimal value (no more than RMB100 [USD15.9]) and is relevant to the practice of the healthcare professional. Possible examples of appropriate items include: pens, notepads and surgical gloves.
2. Can a pharmaceutical company offer give-aways or other gimmicks to an HCP? Is there a specific threshold regulated by law?
Such give-aways may be considered as the above-discussed gifts.
A bona fide souvenir is allowed. However, the gift value should normally be no more than RMB200 (USD31.1.) It is also suggested that the company logo or event name be painted on the souvenir.
3. Can a pharmaceutical company sign a service contract (such as for speaking and chairing at meetings, translating medical documents, writing medical articles and/or giving medical training) with an HCP?
Are HCPs required to get prior approval from their employer to sign such contract?
Under PRC law, a pharmaceutical company may sign a service contract with an HCP under the following conditions:
● The accumulated time of service to be provided by an HCP under the service contract shall be a maximum of one working day per week;
● The HCP signing the service contract must obtain approval from the HCP's employer for signing the service contract; and
● The services under the service contract cannot be provided when the HCP is on leave.
Moreover, according to the RDPAC Code, a pharmaceutical company may sign a service contract with an HCP, if the contract is not signed in exchange for prescribing, recommending, purchasing, supplying or administering products, or for a commitment to continue to do so. The service contract shall not be signed in a manner or on conditions that may have an inappropriate influence on the HCP's prescribing practice.
4. Are HCPs required by law to obtain a written pre-approval from their employer to be able to attend an event organized by a pharmaceutical company?
Under PRC law, the HCP is not required to obtain written pre-approval from his/her employer to be able to attend an event organized by a pharmaceutical company.
However, the HCP should report to the employer his/her attendance at any educational event held by other entities, including pharmaceutical companies. It is advisable that the pharmaceutical company should maintain a record of documents certifying that the HCP attending the pharmaceutical company's educational event has reported his/her attendance to the employer.