business

A provision tucked in President Obama's Affordable Care Act requires drug and medical device companies to publicly reveal their financial relationships with doctors beginning in September 2013.

But a key deadline in the effort to make public these often-controversial alliances, including consulting fees, honoraria, travel and entertainment has come -- and gone.

The Centers for Medicare and Medicaid Services (CMS) were supposed to have crafted regulations for the new transparency law by Oct. 1. Yet it's unclear why the deadline was not met.

Last week, Sens. Charles Grassley, R-Iowa, and Herb Kohl, D-Wis., sent a curt letter to CMS head Dr. Donald Berwick, asking about the lapsed deadline.

"Prompt federal guidance is urgently needed to ensure a smooth path toward increasing disclosure, eliminating conflicts and ultimately providing patients with the tools they need to make informed health choices," the bipartisan duo wrote in their Oct. 3 missive.

A CMS spokeswoman said the agency is "reviewing the letter." Beyond that, she declined to comment.

The machinations in Washington are being closely watched in Minnesota, home to more than 300 med-tech companies, including the world's largest, Fridley-based Medtronic Inc.

The senators first introduced a bill called the "Sunshine Act" in 2007 in the wake of several scandals involving drug and medical device companies showering doctors with lavish perks, such as high-buck consulting agreements and conferences and training sessions in exotic locales.

The transparency effort, which eventually won the support of the drug and med-tech industries, was tucked into the health care reform package Obama signed last year.

Michael Dale, ex-CEO of Plymouth-based ATS Medical Inc., which was sold to Medtronic last year, said the rule could make things cumbersome.

"It's a nightmare for little companies, especially, to put in place the accounting systems to track" the payments, he said. Plus, he said collaboration between doctors and med-tech companies is essential to make devices better and safer.

Drug and device companies must begin collecting payment data on Jan. 1, 2012, and reporting the information to the government the following March. Beginning Sept. 30, 2013, details of the payments will be made public online.

While Grassley and Kohl expressed concern about CMS apparently missing its deadline, one consumer advocate doubts the Sunshine law will ever see the light of day.

Dr. Sidney Wolfe, director of Public Citizen's Health Research Group, is fearful the federal Sunshine Act will be repealed, even before it goes into effect. "The drug industry is a very powerful industry, with powerful lobbyists," he said. "The drug lobby is bigger now in Washington than Big Tobacco."

In the middle of all this brouhaha are the companies that must already comply with disclosure regulations from a handful of states that enacted their own transparency laws.

Nine states currently require drug or med-tech companies to either disclose financial relationships or have an ethical code of conduct in place that governs these pacts. (Minnesota regulations only apply to drug companies.) Two states now require med-tech companies to disclose these relationships -- Vermont and Massachusetts. Failure to comply could result in fines of up to $10,000.

Each state has a different deadline and different rules. Some require "filing fees" ranging from $500 to $2,000. "It's really all over the board," said Mark Gardner, of the Minneapolis law firm, DuVal & Associates, which specializes in FDA regulations. "It's hard for many firms to weed through all of these laws."

In addition, several foreign countries, including the Netherlands, France, Belgium and the Czech Republic, are contemplating similar transparency laws, said Christopher White, general counsel of the med-tech industry group AdvaMed.

Dale said "the spirit behind these laws is understandable, patients may be concerned that their care may be unduly influenced by money."

However, there isn't always a hidden agenda, he said.

"There's the insinuation that every interaction between physician and companies is nefarious," he said. "I take umbrage to that."

Janet Moore • 612-673-7752