Compliance concerns in holding, attending medical conferences

The holding and sponsorship of medical conferences by pharmaceutical enterprises can easily lead to a finding of commercial bribery.

The following were cases of law violation: (1) in 2015, the Market Supervision Administration of Changning district, Shanghai, penalized Shanghai Kingmed Diagnostics because it paid the travel and accommodation expenses, and conference registration fees, for physicians that attended a medical conference; (2) in 2017, the Market Supervision Administration of Putuo district, Shanghai, penalized Chiesi Pharmaceutical (Shanghai) because it invited doctors from hospitals to a conference and for travel, and received sponsorship fees from its parent for organizing the conference; and (3) in 2017, the Market Supervision Administration of Yangpu district, Shanghai, penalized Sino-American Shanghai Squibb Pharmaceuticals because it paid the return business-class tickets of hospital department heads to attend a conference in Europe.

If the pharmaceuticals procured by a hospital are sourced from a pharmaceutical enterprise that holds or sponsors a medical conference, it is difficult for the pharmaceutical enterprise to argue that it did not take advantage of this to secure a trading opportunity or competitive advantage.

Pursuant to such regulations as the Administrative Measures for the Holding of Conference and Forum Activities by Social Organizations, and the Several Provisions for Regulating the Acts of Foundations (for Trial Implementation), social organizations may hold medical conferences and forums. So, in order to avoid breaking the law, many pharmaceutical enterprises no longer sponsor medical conferences, but participate in academic conferences organized by social organizations.

But if their attending is involved in using improper means to secure a trading opportunity or competitive advantage, it will be suspected of breaking the law. For example, in 2018, the Market Supervision Administration of Qingpu district, Shanghai, penalized Lepu Medical Technology (Shanghai) because through such means as paying honorariums to the lecturing experts that attended the conference, and assisting them in preparing their lectures, it sought to influence the content of the experts’ lectures so as to achieve its objectives of publicizing its products to the physicians in attendance, and influencing their professional judgments.

When holding a medical conference, a social organization is required to comply with relevant laws and regulations. The following Q&As attempt to clarify the bottom line that social organizations are required to adhere to when holding medical conferences.

Must the scope of business of a social organization holding a medical conference include the holding of forums? In practice, the scope of business of many social organizations does not include the holding of forums. For example, the scope of business of the medical doctors’ association of a certain province includes exchange of expertise, publicity, education, consulting services, etc., but does not expressly include the holding of forums.

The authors argue that the holding of conference or forum activities by a social organization is required to comply with the purpose and scope of business specified in its articles of association. As long as the theme of a conference is directly related, and does not run counter to the scope of business specified in the social organization’s articles of association, that is all that is required in order to encourage academic exchanges. However, the objective of the conference should be to promote discussion of the business in the social organization’s sector and academic exchange.