Interactions with customers and healthcare professionals policy
INTERNAL USE ONLY Policy title Interactions with customers and healthcare professionals (United States) Policy statement Cardinal Health will conduct all of its interactions with its customers and healthcare professionals in compliance with all applicable state and federal laws, including but not limited to any federal or state healthcare fraud and abuse law, such as federal and state anti-kickback laws, false claims laws, and Stark laws intended to protect against fraud, overcharging and overutilization of government programs, including government sponsored health insurance programs. To that end, employees of Cardinal Health may not provide anything of value directly or indirectly, overtly or covertly, in cash or in kind to a customer or healthcare professional, as defined below, to induce the customer or healthcare professional to (a) refer an individual for the furnishing or arranging for the furnishing of any item or service, or (b) purchase, lease, order, or arrange for or recommend purchasing, leasing, or ordering any goods, facility, service, or item. Employees may not provide anything of value (e.g., gift, meal, grant, scholarship, subsidy, support, consulting contract, educational related item or any other remuneration) unless specifically permitted by Cardinal Health policy or, if permitted by applicable law, approved in advance by the Chief Legal and Compliance Officer or his or her designee. Employees may incur and/or submit for reimbursement only those business expenses that are consistent with Cardinal Health policy. The requirements and restrictions set forth in this policy and related policies apply even if an employee pays for such expenses out of his or her own funds and does not seek reimbursement from Cardinal Health. In addition, information about payments or other transfers of value made to customers and other healthcare professionals may be used to fulfill state and/or federal legal and regulatory reporting requirements, including but not limited to the U.S. Physician Payment Sunshine Act of 2010 (see Appendix A for a summary of applicable laws). Failure to follow this policy could subject Cardinal Health to fines and penalties and, as with all policy violations, individuals to corrective action up to and including termination. Uncontrolled copy if printed Version 15 Page 1 of 14 INTERNAL USE ONLY Policy title Interactions with customers and healthcare professionals (United States) TableofContents Policy statement .......................................................................................................................... 1 A. Definitions........................................................................................................................ 3 B. Business meetings and meals ........................................................................................... 3 C. Business-related entertainment ........................................................................................ 4 D. General prohibition on gifts ............................................................................................. 4 E. Drawings and giveaways ................................................................................................. 5 F. Evaluation and demonstration products and samples ...................................................... 6 G. Research grants ................................................................................................................ 7 H. Charitable Contributions .................................................................................................. 7 I. Providing training and education about Cardinal Health products and services ............. 8 J. Third-party professional or educational conferences ....................................................... 8 K. Providing accredited training and education.................................................................. 10 L. Consulting arrangements ............................................................................................... 10 M. Royalties ........................................................................................................................ 10 N. Clinical trials .................................................................................................................. 10 O. Corruption prevention .................................................................................................... 11 P. Employees of governmental agencies and members of Congress ................................. 11 Q. Accepting meals, gifts or entertainment from customers or healthcare professionals .. 11 R. Application of this policy............................................................................................... 11 Scope ………………………………………………………………………………………….12 Responsible party ...................................................................................................................... 12 Additional information.............................................................................................................. 12 External standards ..................................................................................................................... 12 Internal references..................................................................................................................... 13 Uncontrolled copy if printed Version 15 Page 2 of 14 INTERNAL USE ONLY Policy title Interactions with customers and healthcare professionals (United States) A. Definitions 1. Customer - For purposes of this policy, customer means any person or entity in a position to (a) purchase, lease or recommend for use by a healthcare provider, (b) arrange for the purchase or lease by a healthcare provider, or (c) prescribe for patient and/or healthcare provider use products or services offered by Cardinal Health. This policy applies to both licensed healthcare professionals, as defined below, and to others in a position to make or influence product-related or service-related purchasing decisions for healthcare providers, such as a hospital purchasing manager, hospital administrator, physician practice manager, pharmacist, and/or management personnel within a group purchasing organization. The term “customer” includes entities or individuals with whom Cardinal Health does business or intends to do business (e.g., potential customers). For purposes of this policy, the term “customer” does not include: a. Pharmaceutical and medical device manufacturers, even if Cardinal Health is providing services to the manufacturer (e.g., third party logistics, services under a distribution services agreement, consulting, etc.). Interactions with manufacturers are governed by the Interactions with vendors and other third parties policy b. Non-healthcare customers. Non-Healthcare Customer means any person or entity in a position to purchase, lease or recommend for use, arrange for the purchase or lease any products or services offered by Cardinal Health outside of the healthcare industry (e.g., restaurants, home improvement, janitorial businesses, etc.). The term “Non-Healthcare Customer” includes entities or individuals with whom Cardinal Health does business or intends to do business (e.g., potential Non-Healthcare Customers). Non-healthcare customers are treated the same as vendors and interactions with non-healthcare customers are governed by the Interactions with vendors and other third parties policy. 2. Healthcare professional - For purposes of this policy, healthcare professional means any individual that is licensed to provide healthcare (e.g., physician, nurse, pharmacist, licensed social worker, etc.) and any other individual that is subject to applicable state or federal requirements (see Appendix A). B. Business meetings and meals Cardinal Health may conduct sales, promotional, and other business meetings with customers or healthcare professionals and pay for certain expenses as follows: 1. Meals and refreshments – modest meals and refreshments, as judged by local standards, may be provided as part of a business meeting in accordance with the following: a. Purpose - must be incidental to the bona fide presentation of scientific, educational, or business information and provided in a manner conducive to the presentation of such information. A business meal should not be held for or in conjunction with entertainment or recreation. b. Setting and location - must be in a setting that is conducive to bona fide scientific, educational, or business discussions. Meals should take place at the customer or healthcare professional’s place of business. However, if an appropriate location is not available, meals Uncontrolled copy if printed Version 15 Page 3 of 14 INTERNAL USE ONLY Policy title Interactions with customers and healthcare professionals (United States) may be provided off-site. Factors to consider when choosing a location are: Is the location conducive to scientific, educational, or business discussions?; does the meeting involve equipment that cannot easily be transported to the customer or healthcare professional’s location?; will confidential information be discussed?; is a private place available?; etc. 2. Travel and lodging – usually meetings are held at or close to a customer or healthcare professional’s place of business. However, payment for reasonable travel and modest lodging costs of attendees is permitted when travel is necessary in order to conduct the business meeting effectively (e.g., plant tours, demonstrations of non-portable equipment, tours of offices where services are located, etc.). See also the Cardinal Health Meetings policy. 3. Participants – payment for a meal is permitted only for customer or healthcare professional(s) who actually attend the meeting. You may not pay for a meal for an entire office staff where everyone does not attend the meeting or where a Cardinal Health representative is not present (such as a “dine and dash” program). Payment of meals, refreshments, travel, or other expenses for spouses or guests of customers, healthcare professionals or employees or for any other person who does not have a bona fide professional interest in the information being shared at the meeting is not permitted. See also the sections on Providing training and education about Cardinal Health products, Third-Party professional or educational conferences, and Consulting arrangements with customers or healthcare professionals. C. Business-related entertainment Employees may participate in entertainment or a recreational event with a customer or healthcare professional so long as the customer or healthcare professional pays for his or her own expenses. Entertainment that is offensive, degrading, exploitive or inappropriate due to sexual, racial or religious content is prohibited. As with all violations of company policy, employees that engage in such entertainment while on company business are subject to corrective action up to and including termination. D. General prohibition on gifts Cardinal Health may not provide gifts to customers or healthcare professionals, including but not limited to a drawing or other giveaway prize provided to a customer, a healthcare professional or an entity which will in turn provide the prize to a customer or healthcare professional (e.g., tradeshow drawings, store grand opening giveaways, etc.). Cardinal Health may occasionally provide items, without charge, to customers or healthcare professionals that benefit patients or serve a genuine educational function for customers or healthcare professionals. See also the Evaluation and demonstration products and samples section. 1. Value of the item - other than medical textbooks or anatomical models used for educational purposes, any such item must have a fair market value of less than $100. 2. Secondary use - items that are capable of use by the customer or healthcare professional (or his or her family members, office staff or friends) for non-educational or non-patient-related purposes (e.g., office supplies, DVD player, MP3 player, etc.) are prohibited. 3. Non-educational branded promotional items – non-educational branded promotional items, even if the item is of minimal value and related to the customer or healthcare professional’s work or for the benefit of patients (e.g., pens, notepads, mugs, calendars, and other such items that Uncontrolled copy if printed Version 15 Page 4 of 14 INTERNAL USE ONLY Policy title Interactions with customers and healthcare professionals (United States) have the Cardinal Health name, logo, or the name or logo of one of its products and services, etc.) are prohibited. 4. Gifts of perishable items, cash and loans are prohibited – Unless specifically permitted in this policy, gifts are prohibited even if the gift is in recognition of a significant life event (e.g., promotion, store grand opening, birth of a child, wedding, illness, death, etc.). It is appropriate to recognize life events with a telephone call, card, letter or other form of communication. Life events exception for non-physician customers – Pharmaceutical Segment only: Unless otherwise prohibited by law, flowers or other symbols of condolence not to exceed $150 for a death or illness of a customer or an immediate family member of a customer are permitted. Charitable contributions from business unit funds may not be made on the Travel and Expense card or P-Card and require pre-approval and payment through A/P in compliance with the Charitable Contributions – Corporate Giving Program policy. 5. Examples of prohibited gifts include but are not limited to: a. Gifts of a perishable item (e.g., cookies, wine, flowers, chocolates, gift baskets, holiday gifts, etc.). b. Gift or loan of cash, cash equivalents or securities (e.g., gift certificate, Visa® Gift Card, promissory note, etc.). c. Loan of property or use of equipment (e.g., use of a vacation home, timeshare, aircraft, etc.). 6. Gifts to patients Providing gifts or other items of value to patients requires advance review and approval by the Legal department. E. Drawings and giveaways 1. Drawings and giveaways sponsored by a third party conference or tradeshow, customer or healthcare professional Cardinal Health may provide a drawing or other giveaway prize to a customer, a healthcare professional or an entity which will in turn provide the prize to a customer or healthcare professional so long as all or substantially all of the attendees at the event are eligible to participate and: a. the prize is an item which could otherwise be given to a customer or healthcare professional as a gift (i.e., benefit patients or serve a genuine educational function for customers or healthcare professionals) (see General prohibition on gifts section), or b. the prize or proceeds of the drawing or giveaway will be donated to a charity in which case the donation must be made in accordance with the Cardinal Health Charitable Contributions – Corporate Giving Program policy, including but not limited to the pre-approval process (e.g., the proceeds of a silent auction at a third-party conference are donated to a charity, the proceeds of a drawing at a Trade Association meeting are donated to a charity, etc.). 2. Drawings and giveaways sponsored by Cardinal Health Drawings and giveaways must meet the following criteria: a. Prior approval - The Legal department has pre-approved the drawing, giveaway or similar activity (e.g., drawings at meetings or tradeshows, direct mail campaigns, etc.); Uncontrolled copy if printed Version 15 Page 5 of 14 INTERNAL USE ONLY Policy title Interactions with customers and healthcare professionals (United States) b. Prize i. The prize is an item which could otherwise be given to a customer or healthcare professional as a gift (i.e., benefit patients or serve a genuine educational function for customers or healthcare professionals) (see General prohibition on gifts section); or ii. The prize or proceeds of the drawing or giveaway will be donated to a charity in which case the donation must be made in accordance with the Cardinal Health Charitable Contributions – Corporate Giving Program policy, including but not limited to the preapproval process (e.g., the proceeds of a silent auction are donated to a charity, the proceeds of a drawing are donated to a charity, etc.). c. Participants - At least 100 individuals will be in attendance at the meeting/conference or are recipients of materials from a direct mail campaign; d. Eligibility - Any attendee/recipient may enter (subject to the drawing or giveaway rules), except individuals who are employees of (i) any local, federal or state governmental entity, (ii) Cardinal Health, or (iii) any entity doing business in a state which would prohibit receipt of a giveaway prize; and e. Consideration/fee - No purchase is necessary to enter the drawing or giveaway or win any prize, and f. Entry form - the entry form provides substantially the following language: “By entering the Cardinal Health ______ drawing conducted at __________ [meeting name] and accepting a prize, the undersigned hereby certifies (a) I am not a government employee or an employee of Cardinal Health, (b) neither participation in the contest nor acceptance of a prize contravenes the rules and/or policies of (i) any institution and/or professional organization with which I am required to comply, (ii) my employer, and/or (iii) applicable law. I acknowledge that the value of the prize may be subject to state or federal disclosure requirements.” F. Evaluation and demonstration products and samples Cardinal Health may provide reasonable quantities of products to customers at no charge for evaluation or demonstration purposes. Samples of medical devices must be ordered and documented in compliance with the Sample Center’s standard operating procedures. Cardinal Health must provide customers or healthcare professionals with documentation and disclosure regarding the no-charge status of evaluation and demonstration products. 1. Evaluation products - products provided to customers or healthcare professionals for evaluation are typically expected to be used in patient care (e.g., assess the appropriate use and functionality of the product and determine whether and when to use, order, purchase, or recommend the product in the future). a. Single use/consumables/disposables – the number of single use products provided at no charge must not exceed the amount reasonably necessary for the adequate evaluation of the products under the circumstances. b. Multiple use/capital equipment – may be provided without transfer of title for evaluation purposes. i. Length of time - furnished only for a period of time that is reasonable under the circumstances to allow an adequate evaluation, Uncontrolled copy if printed Version 15 Page 6 of 14 INTERNAL USE ONLY Policy title Interactions with customers and healthcare professionals (United States) ii. Terms - must be set in advance in writing, iii. Title - Cardinal Health must retain title to the multiple use product during the evaluation period, and iv. Removal - Cardinal Health must have a process in place for promptly removing the multiple-use product from the customer or healthcare professional’s location at the conclusion of the evaluation period unless the customer or healthcare professional purchases or leases the products. 2. Demonstration products – products provided to customers or healthcare professionals for demonstration typically are not intended to be used in patient care (e.g., improving patient care, facilitating the safe and effective use of products, improving patient awareness, and educating customers or healthcare professionals regarding the use of products). a. Types of product - typically unsterilized single use products or mock-ups of such products that are used for customer or healthcare professional and patient awareness, education, and training (e.g., gloves, gowns, etc.). b. Labeling/identification - typically identified as not intended for patient use by use of such designations as “Sample,” “Not for Human Use,” or other suitable designation on the product, the product packaging, and/or documentation that accompanies the product. 3. Prescription drug, biologic and medical device samples for use by the patient - Cardinal Health may provide prescription drug or biologic samples for patient use in accordance with the U.S. Prescription Drug Marketing Act. Cardinal Health must provide customers or healthcare professionals with documentation and disclosure regarding the no-charge status of these samples. Due to the complex nature of providing prescription drug and biologic samples, advance review and approval by the Legal department is required. Samples of prescription medical devices must be ordered and documented in compliance with the Sample Center’s standard operating procedures. G. Research grants Cardinal Health may provide research grants to support independent medical research with scientific merit. Such activities must have well-defined objectives and milestones and may not be linked directly or indirectly to the purchase of products or services provided by Cardinal Health. Cardinal Health-initiated or directed research involving a Cardinal Health product or service (e.g., clinical study agreements) is addressed in the Consulting arrangements section. Cardinal Health may provide research grants so long as the following criteria are met: 1. Objective criteria – grants must be provided based on objective criteria that do not take into account the volume or value of purchases made by, or anticipated from, the recipient. Sales personnel may provide input about the suitability of a proposed grant recipient or program, but may not control or unduly influence the decision of whether a particular customer, healthcare professional or institution will receive a grant or donation or the amount of such grant. 2. Documentation - appropriately document all grants. H. Charitable Contributions Cardinal Health may make certain charitable contributions in accordance with the Cardinal Health Charitable Contributions – Corporate Giving Program policy. Uncontrolled copy if printed Version 15 Page 7 of 14 INTERNAL USE ONLY Policy title Interactions with customers and healthcare professionals (United States) I. Providing training and education about Cardinal Health products and services Cardinal Health may offer training and education programs (e.g., “hands on” training, lectures and presentations, grand rounds, etc.) on the products and services it offers. 1. Program and event setting - must be conducted in a setting that is conducive to the effective transmission of information. These may include clinical, educational, conference, or other settings, such as hotels or other commercially available meeting facilities. In some cases, it may be appropriate for Cardinal Health to provide training and education at the customer or healthcare professional’s location. 2. “Hands on” training - must be conducted at training facilities, medical institutions, laboratories, or other appropriate facilities. The training staff used by Cardinal Health must have the proper qualifications and expertise to conduct such training. Training staff may include qualified field sales employees who have the technical expertise necessary to perform the training. 3. Modest meals and refreshments - may be provided to customers or healthcare professionals so long as they are subordinate in time and focus to the training and/or educational purpose of the meeting. 4. Travel and lodging - where there are objective reasons to support the need for out-of-town travel to efficiently deliver training and education, with the prior approval of the Legal department, Cardinal Health may pay for reasonable travel and modest lodging costs of customers or healthcare professionals. 5. Spouses or guests - payment for meals, refreshments, travel, or other expenses for guests of customers, healthcare professionals or employees, or for any other person who does not have a bona fide professional interest in the information being shared at the meeting, is not permitted. J. Third-party professional or educational conferences Cardinal Health may provide financial support for third-party scientific and educational conferences or professional meetings (e.g., continuing medical education (“CME”), etc.) that promote scientific knowledge, medical advancement, and the delivery of effective healthcare. These typically include conferences sponsored by national, regional, or specialty medical associations and conferences sponsored by accredited continuing medical education providers. Cardinal Health may support these conferences in the following ways: 1. Conference grants a. By providing a grant to the conference sponsor to reduce conference costs or to a training institution or the conference sponsor to allow attendance by medical students, residents, fellows, and others who are healthcare professionals in training. b. By providing grants when: (i) the gathering is primarily dedicated to promoting objective scientific and educational activities and discourse; and (ii) the training institution or the conference sponsor selects the attending healthcare professionals who are in training. c. By providing grants only to organizations with a genuine educational function that will use the grant to reimburse only the legitimate expenses for bona fide educational activities. d. By providing grants that are consistent with applicable standards established by the conference sponsor and any body accrediting the educational activity. e. By determining that the conference sponsor will independently control and be responsible for the selection of program content, faculty, educational methods, and materials. Uncontrolled copy if printed Version 15 Page 8 of 14 INTERNAL USE ONLY Policy title Interactions with customers and healthcare professionals (United States) 2. Conference meals and refreshments - meals and refreshments must be modest in value, subordinate in time and focus to the purpose of the conference, and clearly separate from the continuing medical education portion of the conference. Cardinal Health may provide: a. Funding to the conference sponsor to support the provision of meals and refreshments to conference attendees. b. Meals and refreshments for attendees if such meals and refreshments are provided: (i) to all attendees (with the limited exception noted below), and (ii) in a manner that is consistent with applicable standards established by the conference sponsor and the body accrediting the educational activity. Meals and refreshments may be provided to fewer than all attendees (e.g., Cardinal Health customers, etc.) if all of the requirements of Section A are met. 3. Faculty expenses - Cardinal Health may make grants to conference sponsors for reasonable honoraria, travel, lodging, and modest meals for bona fide conference faculty members, even if those faculty members are also customers. 4. Advertisements and demonstrations a. Cardinal Health may purchase advertisements and lease booth space for Cardinal Health displays at conferences, tradeshows, trade association meetings, etc. b. Products may be provided for demonstration or evaluation (e.g., gloves, masks, etc.) in compliance with the sections herein. c. Modest refreshments may be served at the booth (e.g., coffee, water, cookies, etc.). d. Non-educational branded promotional items are not permitted to be used as hand-outs (e.g., lip balm, notepads, badge lanyards, tote bags, etc.). See General prohibition on gifts section above for more details. 5. Advancement of medical education/scholarships – in addition to the educational grants to conference sponsors or training institutions covered above, Cardinal Health may make grants to support the genuine medical education of (i) medical students, residents, and fellows participating in fellowship programs that are charitable or have an academic affiliation, or (ii) other medical personnel (e.g., students pursuing a degree in nursing, physician assistant, pharmacists, etc.). All such medical education grants should be made to the charitable or academic institution sponsoring the medical education and not to any specific individual. 6. Public education - Cardinal Health may make grants for the purpose of supporting education of patients or the public about healthcare topics. 7. Customer sponsored training - If the conference or meeting is sponsored by a customer, Cardinal Health may support the conference or meeting as described in this policy, provided that: a. The conference or meeting is for the benefit of any potentially interested clinicians in the community (not just those on staff at the customer’s institution); b. As a condition of receiving the support, the customer commits in writing to market and publicize the conference or meeting to such clinicians within the community; and c. The support from Cardinal Health is not to be provided in exchange for obtaining or maintaining the customer’s business. Uncontrolled copy if printed Version 15 Page 9 of 14 INTERNAL USE ONLY Policy title Interactions with customers and healthcare professionals (United States) K. Providing accredited training and education Cardinal Health may offer accredited training and education programs to its customers and healthcare professionals so long as the requirements in Section H above and one of the following conditions are met: 1. Public/Customers/Non-Customers a. If the program is readily accessible by non-customers (e.g., web-based training must be accessible by non-customers, live presentations must be open to non-customers, etc.) then the program may be offered without charge to the participants, including Cardinal Health customers. b. The business unit providing the program is responsible for maintaining a record of participants. 2. Customers only The program may be offered exclusively to customers only if the customer pays for the program. a. Work with the Legal department to establish a value for the program. The value of the program should equal or exceed the cost incurred in developing the program. b. Participants are charged for the program on a per use basis (e.g., customer is charged for each course as it is taken online or attended in person, courses are bundled and the customer is charged for the bundle, customer is charged a license fee based on the number of the customers employees who will access the course, etc.). c. The business unit providing the program is responsible for maintaining a record of participants. L. Consulting arrangements Cardinal Health may hire healthcare professionals, including customers, to provide bona fide consulting services to fulfill a legitimate business need (documented in advance) through various types of arrangements, such as contracts for research, product development, development and/or transfer of intellectual property, marketing, participation on advisory boards, presentations at Cardinal Health-sponsored training and other services. All consulting arrangements must be made at fair market value in an arm’s length transaction for the services provided and must not be based on the volume or value of the consultant’s past, present or anticipated business and all other requirements as set forth in the Consulting arrangements with customers or other healthcare professionals procedure. M. Royalties Cardinal Health may enter into a royalty arrangement with a customer or healthcare professional only where the customer or healthcare professional is expected to make or has made a novel, significant, or innovative contribution to, for example, the development of a product, technology, process, or method. A significant contribution by an individual or group, if it is the basis for compensation, must be appropriately documented. Royalty arrangements must be reviewed and approved in advance by the Legal department. N. Clinical trials Due to the complex nature of clinical trials advance review and approval by the Legal department is required. Uncontrolled copy if printed Version 15 Page 10 of 14 INTERNAL USE ONLY Policy title Interactions with customers and healthcare professionals (United States) O. Corruption prevention Similar to situations in locally-, state-, and federally-owned hospitals in the United States, in many countries, doctors, nurses and other healthcare specialists are employed by the government and are considered to be government officials or public servants under applicable local law. Particular precaution must be taken to comply with all applicable laws, policies and procedures when interacting with nurses, doctors, or other healthcare specialists, including but not limited to the U.S. Foreign Corrupt Practices Act (the “FCPA”). The FCPA makes it unlawful to promise, offer, authorize, receive, make or arrange to make any payments or provide anything of value to a foreign government official in order to obtain or retain business. See also Cardinal Health International corruption prevention and Accounting provisions of the U.S. Foreign Corrupt Practices Act policies. Employees are required to comply with the most restrictive requirement and to contact the Ethics and Compliance department with any questions. P. Employees of governmental agencies and members of Congress In the United States, most employees of governmental agencies, including but not limited to locally-, state-, or federally-owned hospitals and clinics, members of Congress and their staffs and other elected officials are generally not allowed to accept meals, gifts or entertainment regardless of the value. Cardinal Health is committed to complying with all applicable federal, state and local regulations, including but not limited to the U.S. Honest Leadership and Open Government Act of 2007, which places particularly stringent restrictions on interactions with members of the U.S. Congress. Failure to follow these requirements can result in personal and/or corporate liability. In order to avoid such liability, employees may not provide any item of value (e.g., meals, travel, lodging, etc.) to (i) any government employee (e.g., employee of a local or state owned hospital) unless the employee receives confirmation from the government employee that acceptance does not violate their policy or applicable law, and (ii) a U.S. federal or state representative or their staffs without the prior approval of the Senior Vice President, Professional and Government Relations. See also Political involvement and contributions policy. Q. Accepting meals, gifts or entertainment from customers or healthcare professionals Except as noted in the second paragraph 2 of this section P, because of a potential for a conflict of interest, employees may not accept meals, gifts, entertainment, drawing/giveaway prizes or anything else of value from a customer or healthcare professional unless approved in advance by the Chief Legal and Compliance Officer or his or her designee. Prior approval is not required for the exchange of gifts of nominal value where local custom in a foreign country dictates such exchange as a matter of courtesy. If the item is more than nominal in value and it would cause embarrassment to not accept the item, the item should be delivered to Cardinal Health. Consult with the Legal or Ethics and Compliance department prior to providing such gifts. See also Section N - Corruption prevention. R. Application of this policy 1. Compliance with applicable law - to the extent that applicable law requires a stricter standard for interactions with customers or healthcare professionals, Cardinal Health policy is to comply Uncontrolled copy if printed Version 15 Page 11 of 14 INTERNAL USE ONLY Policy title Interactions with customers and healthcare professionals (United States) with applicable law. A summary of applicable federal and state law requirements and restrictions is attached as Appendix A. 2. Compliance with customer or healthcare professional policies - to the extent that a customer or healthcare professional has adopted stricter policies than what this policy or applicable law requires, Cardinal Health policy is to comply with the customer’s or healthcare professional’s policies. See also Employees of governmental agencies and members of Congress section. 3. Compliance with business unit or functional group policies - business units or functional groups may adopt a stricter standard than contained herein or in any applicable law or regulation. 4. Interactions with vendors and other third parties who are not customers or healthcare professionals - Interactions with vendors and other third parties who are not Cardinal Health customer or healthcare professionals are governed by the Interactions with vendors and other third parties policy. Scope This policy applies to Cardinal Health, Inc., its divisions and majority-owned or controlled subsidiaries in the United States except in respect to bribery and corruption prevention compliance which is applicable to Cardinal Health employees wherever located. Original effective date December 1, 2009 Date last revised June 1, 2015 Responsible party The Cardinal Health Chief Legal and Compliance Officer is responsible for administering and amending this policy. Additional information External standards The following external standards relate to this policy: Applicable state and federal laws, including but not limited to any federal or state healthcare fraud and abuse law, such as federal and state anti-kickback laws, false claims laws, and Stark laws intended to protect against fraud, overcharging and overutilization of government programs, including government sponsored health insurance programs. Federal and state law requirements (see Appendix A). Uncontrolled copy if printed Version 15 Page 12 of 14 INTERNAL USE ONLY Policy title Interactions with customers and healthcare professionals (United States) Internal references The following internal documents and resources relate to this policy: : Title Establishment and application of Cardinal Health policies Accounting provisions of the U.S. Foreign Corrupt Practices Act Charitable Contributions – Corporate Giving Program Conflicts of interest Consulting arrangements and Advisory Boards with customers and healthcare professionals Corporate Political contributions Customer contract development and execution False Claims Act compliance Interactions with vendors and other third parties International corruption prevention Meetings Political fundraising, contribution and involvement - pre-approval requirements Prohibition on off-label promotion Reporting obligations Standards of Business Conduct Travel and business expenses Upfront discounts – Pharmaceutical Segment Upfront discounts – Medical Segment Upfront discounts – Nuclear Pharmacy Services Interactions with customers, healthcare professionals or vendors Physician Payment Sunshine Act Type Policy Policy Policy Policy Procedure Policy Policy Policy Policy Policy Policy Policy Policy Policy Reference Policy Procedure Procedure Procedure Resource site Resource site Uncontrolled copy if printed Version 15 Page 13 of 14 INTERNAL USE ONLY Policy title Interactions with customers and healthcare professionals (United States) Appendix A The attached chart provides a quick reference guide for compliance with federal and state requirements. If the applicable legal requirement is more restrictive than the Cardinal Health policy, the stricter requirement is indicated on the chart. Otherwise, compliance with the Cardinal Health requirement is consistent with the applicable legal requirement. The chart also indicates whether there is a requirement to disclose information (e.g., U.S. Physician Payment Sunshine Act). The Ethics and Compliance department files the required annual disclosures. Business units should not file their own reports. Currently the following have compliance requirements: California Connecticut Massachusetts Minnesota Nevada Vermont Washington, D.C. The Physician Payment Sunshine Act requires federal disclosure of payments and other transfers of value to physicians and teaching hospitals. The disclosures will be publicly accessible on an Internet database. More information about these federal and state requirements is available on the Interactions with customers, healthcare professionals or vendors Resource Site and the Physician Payment Sunshine Act Resource Site and from the Ethics and Compliance department. Uncontrolled copy if printed Version 15 Page 14 of 14 Appendix A to the Interactions with customers and healthcare professionals polic Interactions with customers and healthcare professionals policy State and Federal Compliance Summary Topic Cardinal Health Policies* Federal and state disclosure requirements - The Ethics and Compliance department files the required annual disclosures in each state and with the federal government. Business units should not file their own reports. Employees are required to accurately and completely enter all information in the travel and expense system or SAP to enable accurate audits and disclosure. California 1 Washington D.C.2 Massachusetts 5 Minnesota 6 Vermont 7 U.S. Physicians Payment 8 Sunshine Act Connecticut 9 and Nevada Washington, D.C. requires annual In compliance with the law, Cardinal Health has established a Comprehensive disclosure of certain expenses.3 Compliance Program which includes a $2000 aggregate dollar limit for gifts, promotional materials and certain other items we may provide to or activities we Connecticut requires Cardinal Health to may engage in with medical or health adopt a comprehensive compliance program that is consistent with the PhRMA professionals1 in California. In addition, or AdvaMed codes and requires disclosure we are required to follow the PhRMA of payments and other transfers of value Code on Interactions with Healthcare made to advanced practice nurses. Professionals when interacting with medical or healthcare professionals 1 in Nevada requires Cardinal Health to adopt California. The PhRMA Code is more written policies and conduct an annual restrictive than our policies as noted compliance audit. below. Minnesota requires annual disclosure of Vermont prohibits providing to a Massachusetts requires annual disclosure of the value, nature, purpose payments to the sponsor of a medical healthcare provider 7 or a member of the educational program; reasonable and particular recipient of any fee, Green Mountain Care board anything of honoraria and expenses of a practitioner value for free or providing any payment, payment, subsidy or other economic benefit with a value of at least $50, which who serves on the faculty at a food, entertainment, travel, subscription, Cardinal Health provides to any covered professional or educational conference advance, service, training, or anything or meeting; and compensation for the else of value unless it is specifically recipient 5 in connection with its sales substantial professional or consulting allowed by state law as noted below. and marketing activities. services of a practitioner in connection Allowable expenditures must be with a genuine research project. disclosed unless otherwise noted below. Disclosures filed under this provision are public data. Minnesota has placed an Banned gifts provided to a healthcare aggregate dollar limit on gifts, including provider or a member of the Green business meals of $50 per year. Mountain Care Board must be disclosed if the value is not recovered prior to the reporting deadline. Beginning with August 1, 2013, the U.S. Physicians Payment Sunshine Act will require disclosure of certain payments and transfers of value made to physicians and teaching hospitals (e.g., academic medical institutions). A list of teaching hospitals is posted on the Physician Payment Sunshine Act Resource Site. Annual disclosure. May not be offered, consumed or provided outside of the healthcare 5 practitioner's office or a hospital setting. Prohibited. Annual disclosure. Prohibited. Annual disclosure. Annual disclosure. Compliance with the Cardinal Health policies constitutes compliance with Connecticut and Nevada state laws. Employees are required to complete compliance training. PhRMA Code training course available online. PhRMA Code training course available online (select sales force in D.C.). Modest and incidental to a bona fide meeting. Annual aggregate $2000 spending limit applies (see above). Annual disclosure. Setting and location Held in a customer or healthcare professional’s place of business or, in certain circumstances, another venue outside of the customer or healthcare professional’s place of business. If a field representative or his/her manager is present, you may not offer, consume or provide a meal outside of the office or a hospital setting to medical or Health 1 professionals and annual aggregate $2000 spending limit applies (see above). Travel and lodging When necessary in order to conduct the meeting effectively. Annual aggregate $2000 spending limit applies (see above). Drop off food/dine and dash (e.g., doughnuts, pizza, desserts, etc.) Prohibited. Participants Payment permitted only for customer or healthcare professional(s) who actually attend the meeting, spouses or guests are not permitted. Entertainment and recreation Customer or healthcare professionals must pay their own expenses. General prohibition on gifts May occasionally provide items to Annual aggregate $2000 spending customers or healthcare professionals limit applies (see above). that benefit patients or serve a genuine educational function for customers or healthcare professionals. Training Business meetings and meals Meals and refreshments *Connecticut requires annual disclosure of payments and other transfers of value made to practice nurses. Annual aggregate $50 spending limit applies (see above). May not be offered, consumed or provided outside of the healthcare 5 practitioner's office or a hospital setting. Annual disclosure. Annual disclosure. Annual aggregate $50 spending limit applies (see above). Prohibited. No gifts of any kind may be given to a member of a medication advisory committee. Annual disclosure. Annual aggregate $50 spending limit applies except for publications and educational materials. Textbooks, subscriptions to online services that provide general medical and drug information and other general references are considered “gifts” that are subject to the $50 aggregate annual limit. Gifts are prohibited except for peer- Annual disclosure. reviewed academic, scientific, or clinical articles or journals and other items that serve a genuine educational function for the benefit of patients which are permitted. Uncontrolled copy if printed Version 11 Effective: June 1, 2015 *This summary does not take the place of reading and understanding the full text of the policy. Appendix A to the Interactions with customers and healthcare professionals polic Interactions with customers and healthcare professionals policy State and Federal Compliance Summary Topic Cardinal Health Policies* California 1 Washington D.C.2 Massachusetts 5 Minnesota 6 Vermont 7 U.S. Physicians Payment 8 Sunshine Act Connecticut 9 and Nevada Value of the item Other than medical textbooks or anatomical models used for educational purposes, any such item must have a fair market value of less than $100. Products that have a secondary use (e.g., office supplies, DVD player, etc.) Prohibited. Annual aggregate $2000 spending limit applies (see above). Annual disclosure of printing costs Annual disclosure. of patient education and disease management materials in excess of $25 per day. Annual aggregate $50 spending limit applies except for publications and educational materials. Textbooks, subscriptions to online services that provide general medical and drug information and other general references are considered “gifts” that are subject to the $50 aggregate annual limit. Gifts are prohibited except for peer- Annual disclosure. reviewed academic, scientific, or clinical articles or journals and other items that serve a genuine educational function for the benefit of patients which are permitted. Annual aggregate $2000 spending limit applies (see above). Annual disclosure. Annual aggregate $50 spending limit applies (see above). Prohibited. Donating items, such as Annual disclosure. iPads, to a professional association to be raffled off to a healthcare professional at a conference, seminar, or professional association event is prohibited. Annual aggregate $50 spending limit does not apply to evaluation products provided by the medical segment to its customers. Loan of a medical device to permit evaluation by the healthcare provider or patient not to exceed 120 days is permitted. Annual disclosure. Annual disclosure except for (1) loan of a medical device not to exceed 90 days to permit evaluation by the covered recipient or (2) a supply of disposable or single use medical devices/supplies intended to last for no more than 90 days. Annual aggregate $50 spending limit does not apply to demonstration products provided by the medical segment to its customers. Annual disclosure. Annual disclosure except for (1) loan of a medical device not to exceed 90 days to permit evaluation by the covered recipient or (2) a supply of disposable or single use medical devices/supplies intended to last for no more than 90 days. Annual aggregate $50 spending limit does not apply to prescription drug samples intended for free distribution to patients May provide samples of a prescribed product and reasonable quantities of an over-the-counter drug, non-prescription medical device or item of non-prescription durable equipment for free distribution to patients. Annual disclosure required. Non-educational branded promotional Prohibited. items Perishable items/Cash/Flowers/ Holiday gifts Prohibited. Drawings and raffles Preapproval required by the Legal department. Evaluation and demonstration products and samples Evaluation products - typically expected to be used in patient care. Annual disclosure. Annual aggregate $2000 spending Single use - must not exceed the amount reasonably necessary for the limit applies (see above). adequate evaluation of the product; multi-use or capital may be provided without transfer of title. Demonstration products - typically are Typically unsterilized single use not intended to be used in patient products or mock-ups used for care. customer, healthcare professional or patient awareness, education, and training and label as "sample", "not intended for human use", etc. Annual aggregate $2000 spending limit applies (see above). Prescription drug, biologic and medical device samples for patient use Prescription drug and biologic samples permitted in accordance with the U.S. Prescription Drug Marketing Act. Prior approval by the Legal department is required. Medical device samples are permitted and must be ordered and documented in accordance with the Sample Center's standard operating procedures. Annual aggregate spending limit does not apply to drug samples intended for free distribution to patients. Research grants Must have well-defined objectives and milestones and may not be linked to purchases; properly documented. Charitable contributions Permitted in accordance with the Charitable contributions policy. Providing training and education about Cardinal Health products and services Samples that will be distributed free to patients do not need to be 4 disclosed. Annual disclosure if provided to support an informational or educational session. Annual disclosure. Certain restrictions apply contact the Ethics and Compliance department. Annual disclosure. Annual disclosure. Annual disclosure. Only charitable donations to Annual disclosure. hospital foundations are permitted. Annual disclosure. Uncontrolled copy if printed Version 11 Effective: June 1, 2015 *This summary does not take the place of reading and understanding the full text of the policy. Appendix A to the Interactions with customers and healthcare professionals polic Interactions with customers and healthcare professionals policy State and Federal Compliance Summary Topic Cardinal Health Policies* California 1 Washington D.C.2 Massachusetts 5 Minnesota 6 Vermont 7 U.S. Physicians Payment 8 Sunshine Act Connecticut 9 and Nevada Program and event setting Settings conducive to effective transmission of information; may (but not required to) occur in a customer or healthcare professional's location. “Hands on” training Must be held in a training facility by qualified staff. Modest meals and refreshments Subordinate in time and focus to the meeting. If a field representative or his/her manger is present , you may not offer, consume or provide a meal outside of the office or a hospital 1 setting and annual aggregate $2000 spending limit applies (see above). Annual disclosure. Modest meals or refreshments may Annual aggregate $50 spending be provided during training limit applies (see above). conducted in the office or hospital setting. If the training is NOT in the office or hospital then food may be provided ONLY IF the training is to educate or inform healthcare 5 practitioners about the benefits, risks and appropriate uses of prescription drugs or medical devices, disease states or other scientific information. Quarterly reporting to Massachusetts is required. Contact the Ethics and Compliance department for additional requirements prior to the training. Annual disclosure. Payment to a Annual disclosure. physician to present information to other physicians must be disclosed; no food may be provided. Travel and lodging When there are objective reasons to effectively deliver training and education. Annual aggregate $2000 spending limit applies (see above). Annual disclosure. Annual disclosure. Annual disclosure required, certain Annual disclosure. restrictions apply, contact the Ethics and Compliance department. Spouses or guests Third-party professional or educational conferences Prohibited. Conference grants Must provide grant to the conference sponsor to reduce the overall costs to all the attendees or to allow attendance by medical students, residents, fellows, and others who are healthcare professionals in training. Annual aggregate $2000 spending limit does not apply to financial support for continuing medical education. Annual disclosure. Educational conferences must meet Annual disclosure. ACCME or equivalent accreditation, payment directly or indirectly to nonfaculty healthcare practitioners is prohibited. Annual disclosure required, support may not be provided to a hospital for a manufacturer-sponsored conference. Payment made not be made directly to a healthcare professional or pharmacist. Conference meals and refreshments May provide funding to the conference sponsor or to the attendees in certain circumstances. May not provide meals directly at a Annual disclosure. continuing education event but sponsor may use funds to provide meal for all attendees. Annual disclosure of the payment to Annual disclosure. the sponsor may be required. May not directly pay for meals. Sponsor may use general funds to purchase meals. Coffee or other snacks or refreshments at a booth at a conference or seminar are permitted and do not need to be disclosed. Otherwise, payments made directly to the conference sponsor (see above) may be used to provide food. Annual disclosure required. Faculty Expenses May provide grants to conference sponsors for conference faculty members expenses. Annual disclosure. Annual disclosure of the payment to Annual disclosure. the sponsor if the sponsor is a covered recipient. Annual disclosure. Expenses of faculty permitted if provided pursuant to written contract (topic restricted to medical issues and is controlled solely by healthcare professional). Annual disclosure is required for payments made to participants in speakers bureau, honoraria, and other payments for time spent speaking at or attending meetings, lectures or conferences or writing articles or publications. Annual disclosure. Annual aggregate $50 spending limit applies (see above). Support must be provided to the conference sponsor. Annual disclosure is not required unless the meeting organizer/sponsor is a covered recipient (e.g., booth rental at an educational symposium sponsored by a hospital is permissible and reportable). Annual disclosure. Annual disclosure. Uncontrolled copy if printed Version 11 Effective: June 1, 2015 *This summary does not take the place of reading and understanding the full text of the policy. Appendix A to the Interactions with customers and healthcare professionals polic Interactions with customers and healthcare professionals policy State and Federal Compliance Summary Topic Cardinal Health Policies* California 1 Washington D.C.2 Massachusetts 5 Minnesota 6 Vermont 7 U.S. Physicians Payment 8 Sunshine Act Connecticut 9 and Nevada Advertisements and demonstration May purchase advertisements and rent booth space. May provide refreshments at the booth. Gifts restrictions apply. Advancement of medical education or Permitted. public education Annual disclosure. Annual disclosure of the payment to Annual disclosure. the sponsor if the sponsor is a covered recipient. Annual disclosure. Annual disclosure. Annual disclosure of the payment to Annual disclosure. the sponsor if the sponsor is a covered recipient. Annual disclosure. Annual disclosure. Annual disclosure. If modest meals or refreshments are offered, consumed or provided outside of the healthcare 5 practitioner's office or a hospital setting then quarterly reporting is required. Contact the Ethics and Compliance department for additional requirements prior to the training. Annual disclosure. Customer sponsored training Permitted if for benefit of any potentially interested clinicians in the community (not just Customer's staff); customer commits in writing to market and publicize within the community; support is not in exchange for the customer’s business. Providing accredited training and education Permitted. Disclosure may be required depending on the option chosen (e.g., may need to be treated as a discount by the participant). Consulting arrangements Permitted in accordance with requirements of the Consulting arrangements with customers and healthcare professionals procedure, including but not limited to needs assessments, fair market value compensation, written agreements, etc. Royalties Preapproval required by the Legal department. Annual disclosure. Clinical Trials Preapproval required by the Legal department. Annual disclosure. Annual aggregate $2000 spending limit does not apply to financial support for continuing medical education. Annual disclosure. Annual disclosure. Annual aggregate $2000 spending limit does not apply to consulting arrangements. Annual disclosure. Specific contract Annual disclosure of payments made for market research surveys requirements required for consultants who are members of a or other activities in support of developing advertising/marketing. formulary committee or who develop clinical guidelines; consult Independent double-blinded research studies paid by the survey Legal department. Double-blinded surveys do not require disclosure. research organization do not require disclosure. Annual disclosure. Cash payments to practitioners for participation in marketing surveys are permitted so long as the survey is for bona fide marketing research. Annual disclosure. Research, such Annual disclosure. as marketing research or surveys, which do not fall within an allowable expenditure for clinical trials and scientific research is prohibited. Consult the Legal department. Food provided as part of the fair market value compensation (e.g., service on an Advisory Board, consulting or speaking) is permitted and discloseable. 1 Aggregate spending limit applies to persons licensed by state law to prescribe drugs for human patients, medical students and members of drug formulary committees. Some pharmacists have prescriptive authority in California. 2 Special licensing and code of ethics requirements apply to pharmaceutical detailers in Washington, D.C. (e.g., employees with sales responsibility in Nuclear Pharmacy Services) including but not limited to continuing education requirements and compliance with the PhRMA Code. See California for summary of PhRMA Code requirements that differ from Cardinal Health policies. 3 Disclosure requirement applies to persons or entities licensed to provide healthcare including healthcare professionals and persons employed by them, licensed carriers, health plans and benefit managers, pharmacies, hospitals, nursing facilities, clinics and other entities licensed to provide healthcare in Washington, D.C. 4 Pharmaceutical detailers may provide samples to members of medication advisory committees only if the person is also a licensed physician engaged in the practice of medicine. 5 The law covers interactions with "covered recipients" which means a person authorized to prescribe, dispense, or purchase prescription drugs or medical devices in Massachusetts, including a hospital, nursing home, pharmacist, health benefit plan administrator, or a healthcare practitioner. Healthcare practitioners means any person who prescribes prescription drugs and is licensed to provide healthcare in Massachusetts (e.g., Advanced Practice Nurse, Certified nurse-midwife, Nurse practitioner, Psychiatric nurse mental health clinical specialist, Dentist, Optometrist, Physician, Physician Assistant, Podiatrist, etc.) , or a partnership or corporation comprised of such persons, or an officer, employee, agent or contractor of such person. Hospitals are not healthcare practitioners. Fulltime employees and Board members of Cardinal Health acting in those capacities are excluded 6 Aggregate spending limit applies to practitioners and does not include pharmacists. "Practitioner" means a licensed doctor of medicine, licensed doctor of osteopathy duly licensed to practice medicine, licensed doctor of dentistry, licensed doctor of optometry, licensed podiatrist, licensed veterinarian, a physician assistant authorized to prescribe, dispense, and administer, an advanced practice nurse authorized to prescribe, dispense, and administer or a dental therapist authorized to dispense and administer. 7 The law covers interactions with a "healthcare provider" which means a healthcare professional, a hospital (excluding a hospital foundation that is organized as a nonprofit entity separate from the hospital), nursing home, pharmacist, health benefit plan administrator, or any other person authorized to dispense or purchase for distribution prescribed products in Vermont. A "healthcare professional" is a person who regularly practices in Vermont and is licensed to prescribe products, or is authorized to recommend prescribed products, or is lawfully providing healthcare in Vermont, or a partnership or corporation comprised of such persons, or an officer, employee, agent or contractor of such person, including nursing and front room staff. 8 The law requires disclosure of payments and other transfers of value to "covered recipient" defined as physicians or teaching hospitals. 9 Disclosure requirement applies to advanced practice nurses. Uncontrolled copy if printed Version 11 Effective: June 1, 2015 *This summary does not take the place of reading and understanding the full text of the policy.
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