Main features of the regime
1. Foreword
On 31 May 2022, the Italian Parliament approved Law 62/2022, also referred to as the Sunshine Act to regulate dealings “between manufacturing companies, subjects operating in the health
sector, and health organisations”. The Act (published in the Official Gazette no. 135 of 11 June 2022) came into force on 26 June 2022.
The law draws from similar U.S. legislation adopted in 2010, the “Physician Payments Sunshine Act”. Other EU countries, such as France, Denmark, Belgium, Greece, Latvia, Portugal, Romania
and Slovakia, have adopted similar legislation.
Prior to the law taking effect, pharmaceutical and medical device manufacturers in Italy were only subject to disclosure obligations if they were members of a voluntary industry association (e.g.,
EFPIA/Farmindustria and MedTech Europe/Confindustria Dispositivi Medici). Reporting is now a legal obligation and the range of players affected (now also including private institutions) has been significantly broadened (see para 4.2 below).
2. Objectives
The Sunshine Act aims to (i) empower health care professionals (“HCP(s)”) in their relationships with the industry and to increase public awareness of the financial ties between pharmaceutical
and device manufacturing companies and HCPs, (ii) prevent and combat major conflicts of interest between key public decision-makers and companies operating in the health sector.
3. Status of the “Sunshine Act” and the Transparent Healthcare Register
The full effect of the Sunshine Act is contingent upon the establishment and operationality of the dedicated, publicly accessible, database on the Ministry of Health’s website – the “Transparent
Healthcare Register” (or “Register”).
The Register – one of the innovations and building blocks of the Sunshine Act – should have been operational within six months from the entry into force of the Sunshine Act, i.e. by 26 June 2022.
When fully operational, the freely accessible public register will be equipped with search and retrieval functions for notices, data and any sanctions imposed. The communications contained in
the Register may be consulted for five years from the date of publication, after which they will be deleted.
The Sunshine Act – still pending activation of the Transparent Healthcare Register – provides for two phases of reporting obligations described below
4. Reporting Obligations – Two Phases
4.1 What must be Reported? (Art 3 & Art 4)
PHASE ONE – Initially to commence the semester following the Register’s activation (i.e. from
26 June 2023
A. Transfers of Value (i.e. money, goods, services or other benefits) during the preceding semester and made to: (i) an individual operating in the healthcare sector (“HCP”) – when the individual value of the transfer exceeds €100 or the annual overall amount exceeds €1,000; and (ii) a healthcare organizations (“HCO”) – when the individual value of the transfer exceeds
€1,000 or the annual overall amount exceeds €2,500. Disclosure frequency: Every Semester
B. Agreements with HCPs or HCOs that produce direct or indirect benefits such as “participation in conferences, training events, committees, commissions, advisory bodies or scientific committees or the establishment of consulting, teaching or research relationships” stipulated in the preceding semester. Disclosure frequency: Every Semester
PHASE TWO – to commence the second year after the Register’s activation (i.e. from January
2024, at the earliest),
C. Quotas, Shares, Bonds or IP License Exploitation.
The details of those HCPs and HCOs that (i) hold quotas, shares or bonds in the company, or (ii) have received fees from the company for the economic exploitation of their intellectual property licenses in the previous year. By 31 January of each year.
4.2 Definitions – the Sunshine Act provides very broad definitions of Companies, HCPs, and
HCOs:
“Company“: means any legal entity, including those belonging to the third sector, that carries out an activity aimed at the production or marketing of drugs, instruments, equipment, goods or services, including non-health products, including nutritional products that can be marketed in the sphere of human and veterinary health, or at the organisation of conventions and congresses concerning the same objects
“Individuals Operating in the Health Sector” or “HCPs”: includes individuals belonging to the health or administrative sector, in any capacity whatsoever, within a public or private health
organisation, and who (regardless of the position held) exercises responsibilities in the management and allocation of resources, or intervenes in decision-making processes concerning drugs, devices, technologies and other goods, including non-health goods, as well as research, experimentation and sponsorship. This list also includes professionals registered in the compulsory National Register of Members of Selection Boards in public contract award procedures;
‘Health Care Organisation’ or “HCOs”: means local health authorities, hospitals, university hospitals, IRCCSs and any public or private legal entity that provides health services, university departments, specialisation schools, public and private research institutes and associations and scientific societies in the health sector, professional orders of the health professions and associations between health professionals, including those without legal personality, public and private entities that organise continuing medical education activities, as well as societies, patients’ associations, foundations and other established bodies.
Sanctions for Violation of the Reporting Obligations (Art 6)
The MoH may impose administrative fines as follows:
(i) the failure to notify disbursements, affiliations and agreements will attract a fine of EUR 1,000, to be increased by twenty times the amount of the disbursement to which the omission refers;
(ii) if the omission relates to the ownership of shares, bonds, industrial or intellectual property rights, the MOH can impose a fine ranging between €5,000 to €50,000; and
(iii) in the event a manufacturer provides false information (and provided the act does constitute a criminal offence) the fine ranges between €5,000 and €100,000. Finally, to make enforcement of the Law more effective, a whistleblowing channel was established to report to the MoH any violations of the obligations under Articles 3 and 4.
Privacy Implications (Art. 5)
The publication of the data contained in the required communications has obvious GDPR and privacy implications. Whilst the Act provides for questionable “implicit” consent to the disclosure
and processing of data, the Sunshine Act clarifies that companies are under the obligation to inform HCPs or HCOs of the disclosure on the Register by providing them with a privacy notice
advising, at a minimum, that their data will be published.
Sunshine Assessment
Until the Sunshine Act becomes fully effective, companies and organisations should use this period to undertake a proper “Sunshine Assessment’ to evaluate the appropriateness of their practices and procedures in ensuring (i) compliance with the applicable legislation and (ii) the effectiveness of the procedures in intercepting transfers of value and agreements that need to be
disclosed. We would suggest the following steps:
1. Review internal policies, including those on the interactions with HCPs and HCOs and on disclosure of relations with pharmaceutical companies.
2. Review existing template agreements and amend as necessary.
3. Review/draft/amend privacy notices to reflect the provisions of the Sunshine Act with regard to implied consent and mandatory reporting.
4. Establish an internal monitoring mechanism to ensure that transfers of value and agreements are timely intercepted and disclosed.
5. Carry out periodical awareness/compliance training for those in charge of the above.
* * *
Masotti Cassella’s dedicated “Sunshine Act Team” is constantly monitoring the developments of the Sunshine Act and studying all legal and regulatory aspects related to its implementation. Do
not hesitate to contact us for any clarification or assistance you may require on the various areas of application of this legislation.
