FDA ISSUES DRAFT GUIDANCE ON THE PROMOTIONAL PRACTICES OF PHARMACY BENEFIT MANAGEMENT COMPANIES

[FDA]

HHS _NEWS_

_U.S. Department of Health and Human Services_
_________________________________________________________________

P98-1, FOOD AND DRUG ADMINISTRATION
FOR IMMEDIATE RELEASE Print Media: 301-827-6242
January 5, 1998 Broadcast Media: 301-827-3434
Consumer Inquires: 800-532-4440

FDA ISSUES DRAFT GUIDANCE ON THE PROMOTIONAL PRACTICES OF PHARMACY BENEFIT
MANAGEMENT COMPANIES

The Food and Drug Administration today published a draft guidance
concerning promotional practices by pharmacy benefits management
companies (PBMs) and similar enterprises that are owned or influenced
by the sponsors of medical products.

Today's Federal Register carries a notice of the availability of this
draft guidance. The draft guidance describes FDA's regulatory
authority under the Federal Food, Drug and Cosmetic Act over the
promotional practices of this growing number of PBM/medical product
sponsor ventures.

"Today's proposal will help FDA keep pace with changes in the
promotion of medical products, said FDA Lead Deputy Commissioner
Michael Friedman. "While PBMs can be useful tools for managing health
care costs, FDA wants to ensure that patients are not put at risk by
improper marketing practices."

Medical product "switching" -- the substitution of one therapy for
another as result of financial incentives -- is one area of concern
regarding the growing trend toward drug and device sponsor ownership
or partnerships with PBMs and other health care organizations. This
practice could have serious health implications for patients --
particularly for those dependent on chronic therapy -- if medical
decisions are influenced by incorrect or misleading information.

Concerns about drug switching and other potentially harmful
promotional practices have come to light as a result of several
in-depth analyses of PBM involvement in medical decision making,
conducted by FDA, the Health Care Finance Administration, and the
Department of Health and Human Service's Office of Inspector General.
In addition, FDA has sponsored a major public hearing and issued a
notice in the Federal Register seeking public comment on this issue.

After thoroughly reviewing these analyses and comments, the agency has
developed this draft guidance that includes the following factors for
determining whether a medical product sponsor can be held responsible
for the promotional activities of a nonsubsidiary PBM that violate the
Federal Food, Drug and Cosmetic Act:

1. The Relationship of the Sponsor and the PBM/ The nature and extent
of a PBM's ties to a medical product sponsor.
2. Sponsor Control or Influence over the Information Content and
Distribution Provided by PBMs/ The role medical product sponsors
may play in assisting PBMs in promotional activity.

FDA is seeking public comment on this proposal over the next 90 days
and these comments will be considered in the development of a final
guidance. Written comments may be submitted to:

Dockets Management Branch (HFD-305)
Food and Drug Administration
12420 Parklawn Drive, Rm. 1-23
Rockville, MD 20857