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October 14, 2024
On October 10, 2024, the Shanghai Municipal Health and Health Commission, together with 13 other government authorities in Shanghai, jointly issued the “2024 Issuance of Guidelines for Correcting Improper Practices in the Purchase and Sales of Pharmaceuticals and Medical Services''. Announced the Shanghai version of the 2024 Notification (2024 Notification).
The 2024 Notification is substantially consistent with the National Annual Framework Guidelines issued by 14 national-level authorities in May. This reaffirms our continued and even more rigorous focus on strengthening anti-corruption efforts and honest practices in the pharmaceutical, medical device and health services sectors.
Compared to the previous notification in 2023, the 2024 notification provides more specific information, such as the purchase, sale of drugs/medical devices, academic events with paid health professional (HCP) speakers, etc. that occur during medical services. hidden corruption and compliance issues have been identified. Additionally, we focus on establishing and improving compliance management mechanisms supported by regular audits and big data-enabled oversight.
Important points
Strengthening oversight of healthcare professional speaking events: “Recommendation-type lectures” (站台style讲课) and “ Particular mention is made of “lectures during meals'' (柌桌書讲课). Medical workers. Managing “critical minorities” and “key position” talent: Healthcare organizations must strengthen internal controls over talent in key positions to prevent unfair benefits and kickbacks. Businesses should use increased caution when interacting with these individuals. Intensive oversight using big data: Authorities will consider introducing a “bribery blacklist” that will focus on repeat offenders, large-scale bribes, and bribes involving multiple individuals. The campaign targets both bribers and recipients and leverages big data to enhance detection. Enhanced Compliance Control Mechanisms: All industry players should establish and improve internal compliance mechanisms to prevent commercial bribery, particularly interactions between pharmaceutical representatives and healthcare professionals.
Comparison to 2023 campaign and what to expect in 2024
Proactive compliance monitoring: Unlike the 2023 campaign, which focused on combating ongoing corruption, the 2024 campaign will include real-time data monitoring, spot checks, audits, and more to detect issues early. , more precautionary measures are being introduced. Systematic Oversight Mechanisms: The 2024 Notification introduces broader compliance expectations and requires all parties in the pharmaceutical, medical device, and medical services supply chain to maintain integrity and compliance throughout manufacturing and distribution. There will be a responsibility to do so. Further diversification of regulatory measures: In 2024, we expect to see a combination of various investigative methods, including inspections, audits, big data analysis, complaints, and self-inspections.
Recommendations
Strengthen internal compliance: Review and strengthen your company's compliance program with regular internal audits that focus on high-risk areas such as procurement, supplier management, and interactions with healthcare professionals. Consider investing in digital tools to track and manage your compliance records. Increased employee training: Ensure regular compliance training is provided to employees, especially those involved in procurement and interactions with healthcare professionals, to increase compliance awareness. Audit preparation: Always ensure that designated personnel are available for unannounced regulatory inspections and have the necessary supporting documentation available.
Morgan Lewis will continue to closely monitor its enforcement practices.
