The new PhRMA code says resorts are not appropriate meeting venues. But the definition of resort is open to debate.
“If there is ‘resort and spa’ in the property name, there is no discussion. We cannot go.”
“One hotelier asked me if my company could meet at his property if he took the word ‘resort’ out of the contract. I said, ‘Not unless you dig up the golf course and move it off site.’”
Those were a few of the comments made by meeting managers during lively discussions at the Pharmaceutical Meeting Management Forum about the ban on resort meeting venues imposed by the new Pharmaceutical Research and Manufacturers of America's Code on Interactions with Healthcare Professionals.
The voluntary code, which went into effect in January 2009, says that “resorts are not appropriate venues” for meetings involving healthcare professionals, and that the venue must be “conducive” to informational exchange, training, or education.
Although the PhRMA guidelines are intended for members — and they're voluntary — the resort prohibition has become a much more significant issue for all pharmaceutical companies as states are ramping up their scrutiny of pharmaceutical marketing practices, including meeting venues.
Planners and suppliers expressed frustration with the resort rules. For planners, the code complicates site selection. As one participant said, it's difficult to find facilities that are compliant with the code, and that offer enough guest and meeting rooms and can accommodate their other needs. Hoteliers say the ban is costing them millions of dollars in lost business.
But the intent of the code is not to set down rigid rules or disadvantage one destination over another; rather, it is to ensure that companies choose properties that are conducive to education and information sharing, said Marjorie E. Powell, senior assistant general counsel, PhRMA, Washington, who addressed several sessions at the forum.
Panelist Tanya Dobash Berlage, partner and chair of the Life Sciences Practice Group, Saul Ewing LLP, Baltimore, agreed, saying the purpose of the code is to ensure that meetings focus on business, not to mandate that they be held at “unattractive properties.”
Adding to the confusion is the difficulty in defining resort. The guidelines were purposely left vague, said Powell, since it is each company's responsibility, not PhRMA's, to determine what types of properties are off limits and which are appropriate meeting venues.
As the comments above illustrate, some companies are prohibiting meetings in any properties that include the word resort in their name or that have recreational activities on site. Although that's not necessarily required from a legal standpoint, some companies are drawing a bright line because it's easier and more practical than evaluating each meeting and each facility on a case-by-case basis, said Berlage, who previously served as chief counsel at a pharmaceutical company.
But simply eliminating properties with resort in their names may not be the most effective approach. “Is this a resort?” Berlage asked, showing participants a picture of a very modest motel that nevertheless had resort in its name. On the other hand, some properties that do not have resort in their names may still be inappropriate. “It shouldn't come down to just the name,” she said. “It should be a more complex, holistic analysis than that.”
If the property has resort in its name, but has adequate meeting space and doesn't have recreation and entertainment components, then it should be permissible as long as planners justify and document their reasons for choosing the venue, said Marianne Demko-Lange, CMP, CMM, director, strategic meeting support, meeting planning and travel, Wyeth, Collegeville, Pa.
Powell added, “Resort in the name is not the be-all and end all — it's not the final answer. Look at the meeting details, look at the learning process.”
Likewise, a venue with recreational activities may be appropriate as well, especially since so many properties either have or are near recreational areas, such as golf courses. “If you can articulate the business reason for meeting at a certain place, and it's conducive to achieving the business purposes of the meeting, it may be fine,” said Berlage.
When the venue suggests entertainment recreation by its name, Berlage suggested that companies should take extra pains to document why the location is conducive to meaningful informational communication, that the presentations provide scientific or educational values, that a legitimate business agenda is the primary purpose of the meeting, that the meeting does not include entertainment or recreational events, and that meals are relatively modest.
It's important that companies establish clear-cut internal guidelines. Wyeth, for example, defines resorts in its meetings policy, explained Demko-Lange. If a property has both entertainment and recreational components, then it is considered a resort and is not appropriate for meetings. Planners need written justification and approval from the vice president to hold a meeting at a property with resort as part of its name.
She also recommended planners use preferred hotels. Procurement executives, in accordance with compliance standards, approve all the hotels on the preferred list, so the decision to meet at a particular venue is essentially pre-approved, she said.
While pharma companies can choose where they hold their own meetings, they have no say in where medical associations hold their conventions, participants pointed out. What should a pharma company do if it wants to hold an ancillary event at a medical association meeting taking place in an area that some perceive to be a resort destination, such as Orlando, Phoenix, Cancun, or Puerto Rico? There are no clear answers.
Some participants said they had heard the code's resort ban might be modified. Powell dashed those hopes. “I've never seen the PhRMA code get less restrictive,” she said.
As for scrutiny, said Berlage, it comes down to what prosecutors are going to focus on. She said she hopes they will not automatically characterize meetings held at properties that happen to have resort in the name as junkets, but will view them as serious meetings.
For more on the PhRMA code, see “Danger Zone,” (September/October 2008) at meetiingsnet.com.
In this heightened regulatory environment, it's critical for pharmaceutical companies to set their own policies for meetings and follow them, said Marianne Demko-Lange, CMP, CMM, director, strategic meeting support, meeting planning and travel, Wyeth, Collegeville, Pa.
Demko-Lange, who is one of 20 quality champions at Wyeth, created a meeting compliance program that sets parameters, educates staff and suppliers, and includes a centralized process that enables her staff to manage meeting compliance.
Her advice for planners: “Keep your boss engaged. You do have power and responsibility regarding compliance and you can prevent costly litigation for your company.”