California turns OIG Guidance into law

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According to this article, California Governor Arnold Schwarzenegger signed into law a bill that requires pharmaceutical companies that do business in Calif. to adhere to the OIG Guidance and PhRMA Code.

    Under a new state law signed in California Sept. 29 by Gov. Arnold Schwarzenegger (R), pharmaceutical companies that do business in California must implement a compliance program and specify how much promotional money they'll spend on providers annually. With its reputation for trend setting, California's move may spur other states to take similar actions.

    The law (S.B. 1765) requires pharmaceutical producers to adopt the voluntary compliance models developed by both the HHS Office of Inspector General (OIG) and the Pharmaceutical Research and Manufacturers of America (PhRMA), their main trade group. The deadline: July 1, 2005.

The usual suspects of gifts, promotional materials, and other items that may appear to induce prescriptions are mentioned as possible violators of the federal anti-kickback law. When the terms of the two guidances conflict, companies have to comply with whichever is the strictest.

According to an analysis of the bill, the exemptions include "financial support for continuing medical education forums, and financial support for health educational scholarships if that support is provided in a manner that conforms to the OIG Guidance and the PhRMA Code."

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