Tip #2: Thorny Issues with Commissions Part 1: What Happens When a Salesperson Is Selling a Drug To Herself or Her Family Member?

A key component of compensation for pharmaceutical salespeople is the sales commission, and some pharmaceutical products are so expensive that even one additional sale can significantly affect a salesperson’s overall annual compensation. As a result, one particularly thorny question arises when the salesperson is seeking a substantial commission because she, or her family member, is the patient using the Company’s product. How can a Company determine, and later address, the inherent conflict of interest when the salesperson is selling to his/her family or friends?

A threshold issue arises in that the Company cannot easily determine whether a salesperson or her family member is the actual patient using the Company’s product. There is no simple method for an employer to collect this information. For example, asking an employee about her medical conditions, or her family member’s medical conditions, raises potential legal issues under the Family Medical Leave Act (“FMLA”), Americans with Disabilities Act (“ADA”) and the Genetic Information Nondiscrimination Act (“GINA”), as well as other state privacy and leave laws. We suggest establishing a clear policy that a salesperson is obligated to self-disclose to her manager, or an ombudsman, any commission-generating sale she makes to herself, her family or a friend.