In 2021, the Chinese healthcare authorities issued regulations prohibiting the improper collection of prescription or usage data, which impose penalties on both HCPs and employees of healthcare companies for collecting or soliciting HCPs’ prescription or usage data of medical products. Medical products in these regulations cover both pharmaceutical products, medical devices and medical consumables. These regulations further illustrate the Chinese authorities’ active investigation and enforcement of corruption-related conduct in the healthcare sector in China.
Prohibition on collection of HCPs’ prescription or usage data for improper purposes
- Regulations targeting HCPs
In late 2021, the Chinese authorities issued regulations prohibiting public HCPs from collecting usage data. Chinese courts have also held that it is illegal to purchase or sell such data or provide monetary benefits to HCPs based on their usage or prescription of medical products.
In November 2021, China’s National Health Commission (the NHC), National Healthcare Security Administration and National Administration of Traditional Chinese Medicine jointly issued the “Nine Principles of Integrity for Medical Institutions’ Staff”(the Nine Principles). These agencies are responsible for investigating violations of the Nine Principles by public HCPs and referring criminal misconduct by public HCPs to Chinese prosecutors.
The Nine Principles state that HCPs are “strictly prohibited from collecting usage data for commercial purposes.” Although the Nine Principles do not define ‘commercial purposes’, a prior regulation regarding the management of prescription and usage data indicates that it refers to collecting and providing HCPs’ usage data to companies in the healthcare sector or assisting such companies in doing so. The Nine Principles make clear that the prohibition on the collection of usage data is part of the prohibition on HCPs receiving ‘commissions’ based on their prescriptions of medical products.
Under the Nine Principles, HCPs are similarly prohibited from collecting, transferring, disclosing, buying or selling patients’ personal and medical data. HCPs are also prohibited from accepting ‘rebates’ from manufacturers or distributors of medical products, as well as gifts from patients. Further, HCPs are prohibited from engaging in medical insurance fraud and referring patients for financial benefits.
The Nine Principles replaced the 2013 regulations issued by the NHC. The 2013 regulations similarly prohibited the collection of “usage data of drugs and medical consumables by HCPs and clinical departments for commercial purposes, or facilitat[ion] [of] the collection of such data by employees of healthcare companies.”
The publication of the Nine Principles coincided with an announcement by the NHC in 2021 that outlined the NHC’s intent to crack down on corruption-related conduct in the healthcare sector between 2021–2024. The NHC indicated that it would actively investigate and severely punish bribe-taking HCPs.
In recent years, Chinese courts have held that it is illegal to purchase or sell HCPs’ usage or prescription data or provide monetary benefits to HCPs based on their usage or prescription of medical products. In a number of cases, employees of healthcare companies also paid fees to employees of hospitals to obtain HCPs’ usage or prescription data. Further, employees of healthcare companies were summoned by Chinese courts to testify regarding improper payments or benefits that were provided to the HCPs. A number of senior public HCPs received penalties, including disgorgement of the improper payments, fines and imprisonment for accepting improper payments or benefits from employees of healthcare companies.
- Regulations targeting employees of companies in the healthcare sector
In 2020 and 2021, the Chinese healthcare authorities issued regulations regarding the improper collection of HCPs’ prescription or usage data by employees of healthcare companies. These regulations signal an evolving shift in corruption-related enforcement within China, which has often been perceived to predominantly focus on bribe-takers, to also impose sanctions on those who are deemed to be bribe-givers.
In September 2020, the National Medical Products Administration issued the “Measures for the Registration of Medical Representatives (for Trial Implementation)”. These measures state that employees of pharmaceutical companies are prohibited from “participating in the collection of individual HCPs’ prescription data for drugs.” If the employees of pharmaceutical companies violate such rules, they can be suspended from academic promotional activities involving HCPs.
In December 2021, the Jiangxi Health Commission issued regulations in accordance with the Nine Principles. Under these regulations, employees of healthcare companies are prohibited from collecting or asking hospital employees for the usage or sales data for medical products. Healthcare companies that violate these regulations are subject to restrictions imposed on their business operations in China. Notably, the Jiangxi Health Commission can terminate supply agreements between hospitals and healthcare companies. The Jiangxi Health Commission can also prohibit hospitals from purchasing medical products from healthcare companies for two years.