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New Rules for Bribery Law in the German Healthcare Sector
Introduction
Corruption now has become a criminal offence in Germany for most individuals working in the healthcare sector. This development will affect the assessment of business practices and the importance of industry compliance. In particular, significant changes to the medical device sector can be expected.
Until now, corruption in the healthcare sector was a criminal offence only for doctors employed in state hospitals who accepted gifts or other benefits. Doctors in private practice and other persons working in the healthcare sector (but not being doctors) were not subject to criminal law on corruption offences. Doctors involved in corruption were regulated only by the Medical Professional Code.
As a result, the healthcare industry developed a number of marketing methods such as “sponsoring”, payment for participating in clinical studies, consultancy agreements and payment for acting as a speaker at a seminar or fees for advising a patient to a clinic or doctor, which would have been impossible without the legislative gap.
This approach had been criticised heavily. The starting point for this criticism was that in 2012 the Federal Court of Justice ruled that a pharmaceuticals representative could not be sentenced for bribing doctors to prescribe medicinal products, since a corresponding criminal provision was missing from the Criminal Code. As a result the German government started to close the gap by amending the Criminal Code with a new law, which on May 13, 2016 passed the last step in the German legislative process so that the new rules will become effective in summer 2016.
Legislation history
On July 29, 2015 the German government introduced a draft bill which aimed to amend the Criminal Code.
This draft bill was discussed in all lobby sectors with various pros and cons. Especially the lobby of pharmacists tried to differentiate between prescription of medicinal products by doctors and ordering of medicinal products by pharmacies from the pharmaceutical industry. The main argument for the intended differentiation was that ordering a medicinal product was a simple commercial act rather than an act in the healthcare sector and thus the pharmacist acting incorrectly would not act on the same level of healthcare as a doctor or clinic acting in direct contact with the patient. However, this argument was not successful and at the end of the legislative proceedings the Criminal Code now covers not only doctors, dentists, psychotherapists and physiotherapists but also pharmacists, nurses, midwives and speech therapists.
On April 14, 2016 the final bill passed the German parliament and on May 13, 2016 the upper house of the German parliament also approved the bill. The bill was then passed to Germany´s Federal President for signature and became effective as of May 30. 2016. Implemented Changes in the Criminal Code.
The Criminal Code was mainly amended by including the following two new rules:
| (1) | Section 299a will close the gap and make corruption a criminal offence for anyone with a job in healthcare if that job requires state-regulated education. Accepting gifts or similar benefits in relation to prescription of a medicinal product or medicinal service or for advising a patient to a clinic or doctor will be considered a criminal offence; | ||
| (2) | conversely, according to Section 299b, the person granting the benefit will commit a criminal offence if he or she bribes such persons. This affects representatives of medicinal product and medical device manufacturers, as well as laboratories and other industry members. Legislation no longer differentiates whether or not people with a job in healthcare are employed in state hospitals or in private practice. |
The penalties for such criminal offences vary from fines to imprisonment for up to three or even five years in severe cases.
The new Section 301 reads as if for bribery in the healthcare sector there could be no need for a permissible applicant to file a criminal complaint. If this were correct the new law of bribery in the healthcare sector would be stricter in comparison to bribery in the “normal” commercial sector where Section 299 requires such a complaint. However, the wording of Section 301 and the reasons of the German parliament for the bill are not clear so the further development on this will unfold in practice.
Conclusion
Looking at the compliance of other industries with corruption developments, it was only a question of time until the healthcare sector followed suit. All participants in the healthcare sector should consider carefully the extent to which the changes will affect their businesses, especially their behaviour with respect to established marketing methods. Especially kickbacks in relation to medicinal products or medical devices to a person in the healthcare sector who is not a doctor may now be a criminal offence.
However, the new criminal provisions do not necessarily have to change all existing marketing methods. Forthcoming developments in practice will determine to what extent typical industry marketing tools (e.g., invitations to training or post-marked studies in medicinal products and medical devices) will be subject to the new provisions.
The new bill implements a standardised procedure of exchanging experience between all functions that shall monitor bribery in the healthcare sector. In this procedure also the public prosecution departments of the various German federal states shall participate.
Not only by this monitoring but also based on the political level it can be assumed that the intention of public prosecution departments to follow acts as now being subject to criminal prosecution will increase tremendously once the new law becomes effective. Some German federal states – like Bavaria – have already announced that they will implement specific public prosecution departments with the only function to follow up on bribery in the healthcare sector.