p>The Advanced Medical Technology Association, AdvaMed recently announced the revised and restated Code of Ethics on Interactions with Health Care Professionals. AdvaMed members range from the largest to the smallest medical technology innovators and companies. The new regulations went into effect July 1, 2009. The updated regulations are designed to get their members, who produce nearly 90 percent of the health care technology purchased annually in the United States and more than 50 percent purchased annually around the world, to adopt a set of standards in managing their physician advisory boards and other consultants in order to be in compliance and get their yearly certification from AdvaMed. These updated regulations are designed to specifically bring transparency to medical advisory boards and consultants and documents the true value that is being generated for medical device manufacturers.

These regulations mirror much of the transparency and accountability that is starting to be discussed around boards of directors and advisory boards in industries outside of the healthcare industry and are designed to make advisory boards work much more effectively with demonstrable benefits to the organizations that they are serving. They are also designed to eliminate the potential conflicts of interest that are prevalent in many of these boards today.

Here are some of the highlights of the new regulations and our suggestions around how to make sure you are in compliance:

• Companies may engage health care professionals to provide bona fide consulting services in the form of advisory boards. In this instance "bona fide" is designed to ensure that the advisory boards are providing value in their advice and are not a "perk" or "payment" that certain clients get for utilizing the products or services of a company. They are requiring a form of accountability that the medical advisory board must provide to prove it is adding value in the form of advice and is not a paid position that could be construed as a conflict of interest. To address this requirement we would recommend that a board charter be built that identifies the needs of the organization and the expectations and outcomes associated with the medical advisory board.
• Consulting arrangements should be entered into only where a legitimate need for the services is identified in advance and documented. If a board charter is built ahead of building the board this would satisfy both of these requirements. The board charter should contain the reason the board is being built, the mission or goal of the board, the types of individuals that have the experience and information needed, the structure of the board, who will be responsible for managing the board internally and how the outcomes are going to be measured.
• Selection of a consultant should be made on the basis of the consultant's qualifications and expertise to meet the demand. An objective selection process should be used to ensure compliance. It should be a very detailed and documented process that does not give any weight to a prospective advisors prior relationship to the organization or its management team. ABA has designed the Multiple Strategic Value Impactor Score (MSVI) which is the first and only truly objective way of "scoring" a potential board members ability to provide value to the organization and document it.
• A Company's sales personnel may provide input about the suitability of a proposed consultant, but sales personnel should not control or unduly influence the decision to engage a particular Health Care Professional as a consultant. Companies should consider implementing appropriate procedures to monitor compliance with this section. By implementing an objective selection process you would eliminate the influence that could be translated in a more subjective process. We would also recommend that a company introduce two more procedures that would eliminate any hint of non-compliance. 1. An accountability system like the ABA Board Management Tool to ensure that the advisors are continually adding value and documenting their contributions. 2. A very in depth board evaluation process that is completed and documented every year that would include an analysis of how the board has met the goals as they are laid out in the board charter AND how each individual member is contributing to the board and the organization.

These are just a few of the many new regulations that are being required that are designed to bring more transparency and accountability to medical device advisory boards. These regulations are the first in a series of new proposals to be adopted putting more emphasis on transparency in paying physicians for the value they really provide as consultants and advisory board members. Senators Grassley and Kohl recently introduced the Physician Payment Sunshine Act which would further require medical device manufacturers to report on a wide range of payments to physicians and physician owned-entities.

All of the ABA processes, methodologies, software and tools have been designed to eliminate the subjective ways boards are built and help our clients bring an objective way of evaluating who needs to be on their board, how they are compensated, the expectations of the board and tracking, monitoring and documenting the effectiveness of the board and its members. By implementing these processes and procedures medical device companies can go far beyond compliance and eliminating risk and start to realize the power of their medical advisory boards while eliminating the enormous amount of time it take to manage a board at this level.