Basic terms and information
Official definitions of terms are included in the Department's regulation, 105 CMR 970.00.
Who is a covered recipient?
A covered recipient is anyone or any organization that is in a position to decide which prescription drugs and medical devices are:
- Prescribed and dispensed to patients
- Purchased for patients, e.g., in a hospital or nursing home
- Recommended for use by a patient as part of a course of Treatment or treatment plan
- Purchased as a diagnostic tool or therapeutic equipment
- Covered by an insurance provider for subscribers to or participants in a health plan
A covered recipient could be an individual, such as a:
- Nurse practitioner
- Physical therapist.
A covered recipient is also the person or persons who decide what prescription drugs or medical devices an employer will allow as part of that company's employee health benefit plan. Massachusetts-licensed practitioners are covered recipients, regardless of whether they are actively practicing or where they practice.
A covered recipient could be a facility or program, such as a hospital, nursing home, clinic, hospice program, clinical laboratory, home health agency or pharmacy.
Who is not a covered recipient?
Full time employees and board members of a pharmaceutical or medical device manufacturer acting in that capacity are not covered recipients. Consumers who purchase prescription drugs or medical devices for themselves or others (e.g., family members) are not covered recipients. Schools, universities and trade organizations, such as the Mass. Society of Optometrists, are not covered recipients.
What is a pharmaceutical?
For the purposes of the regulation, a pharmaceutical is a prescription drug that contains the following or similar warning: "Caution federal law prohibits dispensing without a prescription." Examples of commonly prescribed drugs include Lipitor, Synthroid, Singulair, and Nexium.
What is a medical device?
For the precise definition, see the regulation. In general, medical devices are the tools, supplies and equipment that certain licensed health care providers use to diagnose, treat or prevent medical conditions or intend to affect the structure or function of the body, but not through a chemical action within or on the body, such as would occur with a drug. The federal Food and Drug Administration (FDA) classifies these devices into categories. Manufacturers of Class I medical devices that are exempt from FDA Premarket Notification are not subject to these regulation. Manufacturers of prescription medical devices, e.g., dental cement, prostheses, ultrasound monitors, and those in Class II and III are required to disclose to the Department information about payments the companies make to health care providers and health plan benefits administrators.
If you would like more information about the FDA classifications, see FDA Medical Device Classification.
Requirements for pharmaceutical and medical device manufacturers
In the first year:
The companies were required to register with the Department of Public Health by July 1, 2009, and pay a fee of $2,000
- By July 1, 2009 the companies were also required to establish compliance and training programs for their sales and marketing staff or marketing agents regarding the Massachusetts Marketing Code of Conduct
Beginning July 1, 2010 and each year thereafter, the companies must:
Report certain financial transactions with Massachusetts health care providers (practitioners and institutions) and others who prescribe, dispense or purchase drugs and medical devices. For July 1, 2010, the companies disclosed transactions for the period July 1, 2009 through December 31, 2009. Future disclosures will cover a full calendar year of transactions.
- Pay a $2,000 annual fee
- Attest to the Department that they are in compliance with the Code of Conduct
The transactions that must be disclosed
The companies must disclose "the value, nature, purpose and particular recipient of any fee, payment, subsidy or other economic benefit with a value of at least $50 to any covered recipient in connection with the company's sales and marketing activities" (105 CMR 970.009(1)).
- Reimbursement of expenses in conjunction with a product training program or event
- Compensation for serving as faculty at a Continuing Medical Education (CME) event or participation on a Speaker's Bureau
- Compensation for bona fide services
For the purposes of this website, any of these transactions may be referred to as "payments." The $50 total is for each occurrence, not in total. For example, a $55 dinner provided to a covered recipient would have to be reported, but two $30 dinners would not, even though added together, they total more than $50.
Financial payments that aren't allowed
Pharmaceutical or medical device manufacturing companies are not allowed to make financial payments for covered recipients. Examples of what is not allowed are:
- Gifts of entertainment or recreation. For example:
- Tickets to sporting events, concerts or theater productions
- Leisure or vacation trips
- Sporting equipment
- Meal expenses in conjunction with entertainment or recreation
- Complimentary items such as pens, mugs, calendars, gift cards, etc.
- Meal expenses are restricted and in some instances prohibited. Generally, meals provided to covered recipients must be modest and occasional in nature and can't occur outside of a practitioner's office or hospital setting. Health care practitioners cannot be treated to meals in restaurants.
- Grants, scholarships, subsidies, etc. in exchange for agreeing to prescribe a particular drug or use a particular medical device.
Based on the information reported by the pharmaceutical and medical device manufacturers, the Department has developed searchable database that is available on this website entitled “Massachusetts Pharmaceutical Code of Conduct – Data and Reports“