Update on implementation of MedTech Europe Code

Member associations of MedTech Europe were required to transpose the MedTech Europe Code of Ethical Business Practice in their local codes of conduct by 1 January 2020. This article considers the various implementations of the MedTech Europe Code by industry associations in Belgium, France, Germany, Italy, Netherlands, Spain and the UK.

In December 2015 MedTech Europe (MTE), the European trade association representing the medical technology industries, published a revised version of its Code of Ethical Business Practice (the MTE Code) setting out high expectations for the European medtech industry. In the past five years, the MTE Code has been updated numerous times to progressively become the gold standard for interactions between companies members of MTE and Healthcare Professionals (HCPs) and Healthcare Organisations (HCOs) in the MTE Geographical Area¹.

Among other ethical requirements, the MTE Code set out a prohibition for MTE members to provide direct support for HCP attendance at Third Party Organised Educational Events (so-called ban on direct sponsorship). We’ve previously reported on the challenges posed by this ban across various jurisdictions (see our piece here) before it becomes a requirement for all MTE Member Companies (i.e. full and associate corporate members of MTE), on 1 January 2018.

With a time-limit for transposition set at 1 January 2020, MTE Member Associations (i.e. associate national association members of MTE) have had two additional years to implement the provisions of the MTE Code.

Just a few days after the 2020 deadline, this piece addresses the ban and transposition requirements laid down by MTE before discussing the variety of implementations among MTE Member Associations in Belgium, France, Germany, Italy, Netherlands, Spain and the UK, and the legal challenges these may raise for companies active in each local market.

MedTech Europe ban & transposition requirements

The ban on direct sponsorship forbids the direct selection and sponsoring, on an individual basis, of HCPs participating in Third Party Organised Educational Events. It applies to the sponsorship of HCPs registered and practising in the MTE Geographical Area, regardless of whether they act as a Delegate (passive participation) or a Faculty (active participation) at the Third Party Organised Educational Event².

Since 2018, funding for HCP’s participation in Third Party Organised Educational Events has to go through an HCO responsible for making sponsoring requests and selecting the HCPs benefitting from the funding (indirect sponsorship via Educational Grants³). MTE Member Companies must disclose Educational Grants on the Transparent MedTech platform, except in jurisdictions where equivalent or stricter transparency principle applies under local laws – as is the case in Belgium, France and Portugal.

MTE Member Associations were required to transpose the MTE Code at the national level by 1 January 2020, with three options available to them⁴:

1. full transposition of the MTE Code;
2. transposition of the MTE Code “with some adjustments to the local situation”; and
3. if transposition of the MTE Code is not feasible for objective reasons, requirement to (i) promote the MTE Code as a best practice and (ii) actively engage national, and if applicable local government/authorities and/or other stakeholders, to change practice in their country through legal or self-regulatory measures.

Examples of implementations of the MTE Code by different national MTE Member Associations are outlined below.

Belgium

The Belgian Federation of the medical devices industry (beMedTech) has implemented the ban on direct sponsorship of HCPs for their participation in Third Party Organised Educational Events in the latest version of its Code, which entered into force in May 2019 (the beMedTech Code⁵). The ban binds beMedTech members since 1 January 2020⁶.

beMedTech intends to go further than the provisions of the MTE Code and requires that local members also comply with a ban on indirect sponsorship of HCPs for their participation in the same events from 2022⁷. According to beMedTech, indirect sponsorship reduces – but only partially – the risk of improper influence. Members of beMedTech are allowed to continue, temporarily, to be indirect sponsors, until 1 January 2022. In this case, a series of Best Practices ⁸ should be considered.

The identity of HCPs who are indirectly sponsored must be disclosed on a yearly basis on betransparent.be in accordance with the Belgian Sunshine Act. In practice, companies may struggle to identify the disclosure regime applicable to indirect transfers of value to HCPs, to break down reportable indirect advantages and benefits in kind and may lack identification data concerning the HCPs they are (indirectly) sponsoring via Educational Grants. Further guidance is available on our website (we’ve previously published a summary of the Sunshine Act and a Checklist for compliance).

France

In France, the MTE Code has been transposed with a number of adjustments.

After having voted against the revised MTE Code in 2015, the National Association of Medical Technologies Industry (SNITEM) informed its members in November 2019 that the MTE Code, including the ban of direct sponsorship of HCPs attending Third Party Organised Educational Events, will be fully implemented locally from 1 January 2020.

SNITEM also announced that SNITEM members which are not direct members of MTE will have the possibility to seek a derogation to postpone the application of the ban on direct sponsorship for an additional two years, i.e. until 31 December 2021. It is therefore expected that all SNITEM (non-MTE) members will be compliant with the ban of direct sponsorship as of 1 January 2022. A training campaign will be launched in order to assist them in the operational deployment of the revised Code.

The implementation of the MTE Code in France raises legal challenges, in particular considering:

• the obligation for medical devices companies to submit any invitation and sponsorship, intended for a French HCP, to the relevant Professional Board for prior opinion – very soon in 2020, for prior authorisation (French anti-kickback regulation); in practice, this implies that companies have obtained the name of the HCP concerned by the Educational Grant before the event. Notably, a new anti-kickback regulation will apply in a few weeks, when the implementing texts of the Order dated 19 January 2017 are published;
• the requirement to publish benefits granted to HCPs (including as part of sponsorship) on a publicly available Website (French transparency regulation).

Germany

The latest version of the German Federal Medical Technology Association (Bundesverband Medizintechnologie or BVMed)’s Medical Devices Code (Kodex Medizinprodukte or BVMed Code⁹) entered into force on 1 January 2018.

Two types of costs for advanced training and further education are addressed in the BVMed Code:

• those supported directly for the benefit of the participant (individual cost support or individuelle Kostenübernahme); and
• those supported indirectly for the benefit of the employer, a professional medicinal society/association or a professional organisation (institutional cost support or institutionelle Kostenübernahme¹⁰). Without setting out a ban on direct sponsorship for local members of BVMed, the BVMed Code recommends that¹¹:
  “The main goal for all involved parties in the healthcare market is to avoid being under suspicion of corruption. A complete risk minimisation of direct support for the participation in [Third-Party Organised Educational Events] can only be achieved by companies discontinuing such support altogether.��

Of note, German law still permits direct sponsorship of HCPs subject to compliance with applicable laws, including local rules on anti-corruption laid down in sections 299, 331 et seq. of the German Criminal Code and, specifically for the healthcare sector, sec. 299a and 299b of the German Criminal Code (see our piece here for further details).

Italy

In Italy, the provisions of the MTE Code have been transposed into the Code of Ethics approved by Assobiomedica (now Confindustria Dispositivi Medici or CDM) in 2018, and then reaffirmed in the latest edition of the CDM Code of Ethics dated December 2019 (the CDM Code), which is substantially in line with the MTE Code.

Direct sponsorship of HCPs for attendance at Third Party Organised Educational Events is no longer permitted since 1 January 2019 and, following the logic of the MTE Conference Vetting System, a national system (Sistema di Valutazione delle Conferenze – or SVC) has been established, that reviews the compliance of Third Party Organised Educational Events with the CDM Code. The system started operating on 1 July 2018 and it reviews national events taking place after 1 January 2019.

Furthermore, a full transparency system has been introduced. CDM member companies will be required, as of 2021 with reference to data regarding the 2020 calendar year, to disclose all direct and indirect transfers of value to HCPs, HCOs, and third parties by means of a specific transparency template.

Netherlands

Since 1 January 2018 the Netherlands Medical Devices Act includes a general prohibition of advantages by medical device companies to HCPs, with some specific financial interactions excepted. Under strict conditions, financial contributions to the cost of (participating in) meetings, reasonable remuneration for legitimate services, small gifts with professional relevance and customary bonuses and discounts are permitted. The Ministry of Healthcare also issued Guidelines (Beleidsregels gunstbetoon Wet op de medische hulpmiddelen¹²) providing some clarity on the statutory exceptions. The new system is in line with the legal provisions that were already applicable to medicinal products in the Netherlands.

In close cooperation with the Dutch Health Inspectorate (the IGJ), which enforces medical device legislation, the Dutch medical device industry code (the GMH Code) was amended as per 1 January 2018 to closely reflect the new legislation. Compulsory publication of certain financial interactions (services remuneration, sponsorships) in the Healthcare Transparency Register was previously introduced in 2017.

Unlike other jurisdictions, a deliberate choice was made in the Netherlands not to implement the MTE Code at the same time as the above changes, so that no further amendments will be made as per 1 January 2020. The GMH Code’s primary focus is to ensure that suppliers and HCPs are fully aware of the new legislation and corresponding GMH requirements. In 2018 and 2019, efforts were devoted to developing educational activities for all parties concerned around their legal obligations. These place MTE Member Companies in a delicate position, as they have to fully comply with the MTE Code on top of the GMH Code, even if the former contains clauses which in part deviate from the Dutch legal provisions (such as the ban on direct support for HCPs’ attendance at Third Party Organised Educational Events).

The IGJ investigated a number of services agreements in 2018-2019. It has recently announced follow up investigations with a focus on the reasonableness of remunerations paid. Enforcement by means of fines may also commence, as the medtech industry and HCPs are now considered to be sufficiently aware of the strict local legislation relating to financial interactions.

Spain

The Spanish Federation of Healthcare Technology Companies (Fenin) approved an updated Code of Ethics of the Healthcare Technology Sector on 20 December 2016 (the Fenin Code¹³), implementing the MTE Code.

The new Fenin Code entered into force on 1 January 2018. Since then, direct sponsorship of healthcare professionals for their participation in Third Party Organised Educational Events is no longer allowed¹⁴. Fenin members are only able to offer financial support to HCPs attending Third Party Organised Educational Events through Educational Grants with HCOs. Under the Fenin Code, the HCO receiving the educational grant is solely responsible for the selection of the participants and this should be expressly reflected in writing in the agreement with the member company. In this agreement, member companies may define the professional profile of the HCP(s) that may benefit from the grant but should not identify individual recipients.

Fenin has decided to use the Transparent MedTech platform of MTE to disclose grants. Since 2018, each company associated with Fenin should disclose on an annual basis all grants given to HCOs during the previous calendar year, either directly or through professional event organisers. All data should be uploaded on Transparent MedTech in the first six months of the year. This includes, in addition to identifying the recipient (HCO), providing the aggregate amount that has been paid to each entity according to the two following categories:

• educational grants to support third party organised educational events; and
• other grants, for example grants for public awareness campaigns.

United Kingdom

From 1 January 2019, the UK Association of British HealthTech Industries’ (ABHI) Code of Conduct (the ABHI Code) prohibited its member companies from providing financial or in-kind support directly to individual HCPs to cover costs of attendance at Third Party Organised Educational Events (e.g. to pay registration fees, travel or hospitality expenses). Notably, the ABHI Code continues to permit direct support to an HCP to:

• speak at a satellite symposium where engaged to do so pursuant to a consultancy contract; and
• attend Third Party Organised Procedure Training.

As mentioned previously, member companies may still provide Educational Grants to HCOs. While these may be restricted grants, e.g. the grant agreement may specify that the grant is intended for the advancement of genuine medical education, it must be for the healthcare organisation ultimately to determine how the grant it spent and which HCPs benefit from the grant.

To ensure compliance with the spirit of the ABHI Code, the ABHI introduced specific requirements for the provision of such grants, including an obligation to disclose these grants. The first reporting period for such grants was 2019. The ABHI will shortly be contacting member companies to provide a template to use when reporting financial disclosures which will essentially allow a member company to either:

1. declare it does not offer any sponsorship to HCPs;
2. confirm that it is already making this financial disclosure in its capacity as a MTE member; or
3. report its 2019 figures on Transparent MedTech. Compliance with this disclosure obligation is a condition of ABHI membership; however, if a member company joined part way through 2019, its first reporting period will be 2020.

All terms with a capital letter used in this article have the meaning ascribed to them in the Glossary of the MTE Code (Part 4) unless otherwise defined in this Article.

¹Outlined in Annex III of the MTE Code
²Annex I and Annex VI of the MTE Code
³Part 1, Chapter 4, Section 3, of the MTE Code
⁴Part 3, Section 2.2 of the MTE Code
⁵Only available in French and Dutch
⁶Article 30, first indent, (1) of the beMedTech Code
⁷Article 30, first indent, (2) of the beMedTech Code
⁸See appendix 2 of the beMedTech Code
⁹Only available in German
¹⁰Paragraph 8, sub paragraph (2), 2., b) of the BVMed Code
¹¹Paragraph 8, sub paragraph (2), 2., b), footnote 1 of the BVMed Code
¹²Only available in Dutch
¹³Only available in Spanish
¹⁴Chapter VII of the Fenin Code, Educational events organised by third parties, 1) a.