The Ontario Government introduced a bill on September 27 to enact legislation aimed at strengthening transparency in Ontario's health care sector. The Health Sector Payment Transparency Act, 2017 (HSPTA), would require the drug and health product manufacturers to disclose payments made to health care professionals, organizations and other recipients. If passed, Ontario would be the first Canadian province or territory to mandate disclosure of private sector payments to health professionals.
The proposed HSPTA is not yet law and it is unknown whether a review committee will hold public hearings in the future to consider amendments to the draft legislation.
What You Need To Know
Since the proposal was announced, the Health Minister of British Columbia indicated his intention to follow suit.1 Other provinces are likely to watch for developments in Ontario before expressing similar levels of commitment.
The key provisions of the HSPTA include the following:
- People: The HSPTA would apply to those who manufacture, fabricate, produce, process, assemble, package, label, distribute, import, market, promote or facilitate sales of a medical product (drugs or medical devices). It would also apply to those who organize continuing educational events for the health profession on behalf of those entities. Intermediaries who provide or facilitate a transfer of value, and affiliates of such entities would also be regulated under the HSPTA.
- Transactions: The above persons need to report to the Minister of Health when they directly or indirectly transfer a value above the dollar threshold to be prescribed by regulations. Transfer of value is broadly defined as payment, benefit, gift, advantage, perquisite or any other benefits prescribed by regulations.
- Information: Companies will be required to report the name and addresses of the parties to the transaction, as well as the date of transfer, dollar value, description and reasons for transfer. This information will be made publicly available.
- Inspections: The Minister will have rights of inspection, including the right to enter business premises if they reasonably believe a record relating to a transaction that needs to be reported may be in the premises. Inspectors may examine, make copies of, demand the production of, and remove (for the purpose of making copies) the relevant records. Production orders are also contemplated by the HSPTA.
- Penalties: Persons convicted of contravening the Act or its regulations may be subject to a fine of the following amount for each day or part day the offence occurs or continues:
• an individual's first offence: not exceeding $10,000;
• an individual's subsequent offence: not exceeding $25,000;
• a corporation's first offence: not exceeding $50,000; and
• a corporation's subsequent offence: not exceeding $100,000.
The HSPTA has many similarities to the US Physician Payment Sunshine Act (section 6002 of the Patient Protection and Affordable Care Act)2 and so international organizations will be familiar with the general transparency concepts addressed by the pending legislation.
Bill 160 is in the very early stages of the legislative process and will take some time before it becomes law. The Legislative Assembly is not under any obligation to conduct public consultations, but the review committee may choose to hold public hearings and consider amendments during the legislative process. Once HSPTA becomes law, regulations will be enacted to further clarify the Act and prescribe details surrounding its implementation, such as manner and frequency of reporting, length of time required for the retention of records, and persons qualifying as recipients.
To discuss these issues, please contact the author(s).
This publication is a general discussion of certain legal and related developments and should not be relied upon as legal advice. If you require legal advice, we would be pleased to discuss the issues in this publication with you, in the context of your particular circumstances.
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