Will New Jersey’s crackdown on doctor kickbacks claim clinical trials as collateral damage?

Doctor putting money in pocket
A recent regulation proposed by the New Jersey Attorney General might affect the state's availability of clinical trials. (Getty/Niyazz)

After recent investigations into Insys’ dubious opioid marketing tactics, New Jersey is mulling over a new rule that would cap payments from biopharma companies to physicians. But that rule might claim an unexpected victim—clinical trials—at least according to the Association of Clinical Research Organizations (ACRO).

The proposed state regulation, titled “Limitations on and Obligations Associated with Acceptance of Compensation from Pharmaceutical Manufacturers by Prescribers,” comes from the New Jersey Office of the Attorney General. It would limit a physician's compensation received from pharma companies at $10,000 a calendar year. These “bona fide services” include speaker fees, participation on advisory boards and consulting arrangements.

During a public hearing on the proposal on Oct. 19, ACRO Executive Director Doug Peddicord, Ph.D., pointed out that the current $10,000 ceiling, if not otherwise revised or clarified, would also be applied to clinical trial payments. Most of these payments are meant to cover costs of medical supplies, tests and laboratory services, compensation to patients, as well as research staff salaries, or in Peddicord’s words “pass-throughs” for research.


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RELATED: Insys-paid physician faces loss of license as New Jersey aims to curb pharma's doctor payments

Quoting numbers from ACRO member company QuintilesIMS, Peddicord put the per-patient cost of a breast or prostate cancer trial at around $10,000 to $20,000.

ACRO president and CEO of CRO Bioclinica, Joh Hubbard said in a statement afterward that the association “thought it extremely important to request that New Jersey revise the proposed regulation to exclude such payments.”

To address the recent opioid epidemic, federal and state investigations target some pharma companies’ opioid marketing conducts that involved gifts to physicians. Insys Therapeutics, together with its fentanyl product Subsys, is at the center of the scandal. Indictments have been handed down to company executives and salespersons, and during the Oct.19 hearing, New Jersey AG Christopher Porrino announced that the state was moving to revoke a physician’s medical license for overprescribing Subsys in return for $136,768 in payments from Insys.

“However well-intentioned, if this regulation does not exempt payments to doctors to run clinical trials, it will be impossible to enroll a single patient in many trials and the state’s position as a major hub of biomedical innovation will be destroyed,” Hubbard said.

RELATED: Look out, pharma marketers. California may turn off speaking fees and ban pharma gifts

Many states impose similar pharma-to-doctor payment restrictions. A recent bill passed by the California senate, for example, restricts such payments on travel, meals, and speaking and consulting fees, but leaves clinical trials out.

The New Jersey Office of the Attorney General did not respond to a request asking for the entire transcript of the hearing by press time. Peddicord told FierceCRO that he thinks the Office’s Division of Consumer Affairs “heard the message regarding clinical trial payments.” He said that he’s hopeful that such payments will be excluded from the final rule, but will continue to advocate until his organization is certain.

The Division is collecting written comments to the proposal until Dec.1.


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