Sunshine rules: a new statutory transparency register

Currently, the reporting of financial relationships through disclosure in the Dutch Transparency Register is required under the Dutch self-regulatory code of conduct in relation to medical devices (in Dutch: “Gedragscode Medische Hulpmiddelen” or GMH) and the Dutch self-regulatory code of conduct regarding pharmaceutical advertising (in Dutch: “Code Geneesmiddelenreclame” or CGR). However, the GMH and CGR are only applicable to members of umbrella organizations that have committed themselves to the self-regulatory codes.

In practice it is possible that health care professionals with whom medical device and pharmaceutical companies are contracting are required to report financial relationships to the Dutch Transparency Register as they could be bound by the GMH and/or the CGR.

However, not all medical professionals are bound by the current (self-regulatory) transparency requirements and not all financial relationships are (required to be) reported.

This concerns the Minister as these unreported relationships could entail payment of great amounts of money and enforcement by the Dutch enforcement authority (the Health and Youth Care Inspectorate, in Dutch: “Inspectie Gezondheidszorg en Jeugd” or IGJ) in case of non-compliance is at this moment not possible. Therefore, the Minister intends to develop a statutory transparency register with the obligation to disclose all financial relationships between health care professionals and medical device and pharmaceutical companies.

The Minister stated that for the statutory transparency register she intends to maintain the threshold for all agreements under EUR 500 per calendar year and the principle that the industry will remain responsible for the reporting of financial relationships. This is the same as currently under the self-regulatory codes GMH and CGR.

If Sunshine rules become statutory law with a mandatory publicly accessible Healthcare Transparency Register, this would mean that enforcement by the IGJ would become possible, including the possibility of imposing administrative law penalties and other sanctions.

Expanding responsibility of directors of health care providers when agreeing on financial relationships between health care providers and the industry

The Minister also intends to expand the responsibility of directors of health care providers when agreeing on financial relationships between health care providers and the industry.

During recent surveillance the IGJ concluded that the board of directors of hospitals (or other health care institutions) often lacks sufficient insight into the financial relationships entered into by health care professionals working in their hospital.

The approval of the board of directors by means of co-signature of the agreements concluded between health care professionals and the industry is already required for certain financial relationships with the industry under the self-regulatory codes GMH and CGR as of 1 January 2024.

If this becomes a statutory requirement, it would mean that enforcement by the IGJ would become possible, including the possibility of imposing administrative law penalties and other sanctions.

Better legal framework for sponsoring

As a third measure, the Minister proposes an improvement to the legal framework for sponsorship. Examples of financial relationships that often fall under the term ‘sponsorship’ include: grants, donations, financing of meetings/events, financing of scientific research, provision of fellowships, chairs or scholarships, funding of (health care) projects, and/or contributions to patient organizations.

In the context of enforcement, the Minister intends to strengthen the regulatory framework for these types of financial relationships.

Next steps

For the time being, the Minister has only announced new measures to be developed to better ensure transparency and avoid prohibited inducement where possible. The next step would be the publication of new draft legislation. Once draft legislation is published, it would still need to be passed by Parliament. However, this would take some time and the new statutory provisions are not expected until next year at the earliest, possibly further delayed by the caretaker status of the current government after the elections in the Netherlands which took place in November 2023.

In the meantime

In the meantime, the Minister plans to strengthen the self-regulatory framework, recognizing that the development of new regulations takes time. The current Dutch Transparency Register is being revised, with improvements made to the search engine and various issues being resolved. This enhances the effectiveness and transparency of the register.

Further, the IGJ increases the supervision of medical device and pharmaceutical companies and health care institutions within the possibilities under the current legal framework and intends to take further measure where needed. The IGJ is also in contact with other enforcement authorities within the field of financial flows, such as the Fiscal Intelligence and Investigation Service (in Dutch: “Fiscale inlichtingen- en opsporingsdienst” or FIOD) and the Dutch Healthcare Authority (in Dutch: “Nederlandse Zorgautoriteit” or NZa).

Take-aways for the industry

The Minister will start working on the new statutory measures and announced that she will do this in continued consultation with stakeholders. This may provide industry the possibility to engage in discussions for the development of the legislation.

Given the focus on this subject by the Minister and the IGJ at this moment and the intention to increase supervision and enforcement by implementing statutory requirements, chances increase that both the industry and hospitals are inspected now and in the future, making it of additional importance to comply with current regulations and possibly taking preparational measures, identifying possible amendments to template agreements.

Please contact the authors or the Hogan Lovells attorneys with whom you regularly work for additional information.

Authored by Julia Mischie and Hein van den Bos.