Canada: Promotion Of Drugs and Devices At International Conferences Held In Canada

Last Updated: February 4 2009
Article by Eileen McMahon and Laila Paszti

This article first appeared in Update, Issue 1, January/February 2009.

Reprinted with permission of the Food and Drug Law Institute (FDLI) ©2009.

As a neighbor, Canada is often selected as a venue for international conferences of U.S. drug and device manufacturers. Products and uses advertised at these Canadian conferences can be 1) approved in the United States but not in Canada, 2) approved in Canada but not the United States, or 3) approved in neither country. Pharmaceutical companies are increasingly seeking to understand Canadian laws regarding off-label promotion—that is, promoting these products for a use different from that approved by the regulatory authorities—to avoid running afoul of these authorities, whether they are acting on their own or working with the U.S. Department of Justice (DOJ).1

Impact of U.S. Off-label Prosecution

Off-label promotion of pharmaceutical products has resulted in stiff penalties imposed by the DOJ. Fines totaling several hundred million dollars as well as civil and criminal charges against pharmaceutical companies and their personnel are making pharmaceutical companies scrutinize their advertising practices and adopt a cautious approach to advertising—not only domestically but also at international conferences, including ones held in Canada.

With a spate of high-profile prosecutions, the DOJ has firmly entrenched itself in an area traditionally occupied by the U.S. Food and Drug Administration (FDA) alone—namely, the policing of pharmaceutical companies' promotional activities.2

Canadian Law

Given the enforcement activities of DOJ, it is hardly surprising that pharmaceutical companies are considering the effect of Canadian laws on their promotional practices at international conferences, particularly ones where sales representatives intend to promote unapproved drugs, unapproved devices or their uses. The Canadian Food and Drug Act,3 administered by Health Canada, defines the general parameters for allowable advertising of drugs and medical devices. Section 9.1 of the Act states that no person shall advertise any drug in a manner that is false, misleading or deceptive or is likely to create an erroneous impression regarding its character, value, quantity, composition, merit or safety. Section 20.1 has a similar prohibition regarding the advertising of medical devices. The Act also sets out more explicit rules for advertising certain products.

With respect to advertising new drugs, section C.08.002 of the regulations under the Act states that no person shall sell or advertise a new drug unless the manufacturer of the new drug has filed a new drug submission or an abbreviated new drug submission relating to the new drug and the Minister of Health has issued a notice of compliance (an approval) for the new drug. The Act defines the word "sell" to include an offer for sale, expose for sale, have in possession for sale and distribute—whether or not the distribution is made for consideration. "Advertising" is defined more broadly to include any representation by any means whatsoever for the purpose of promoting directly or indirectly the sale or disposal of any food, drug, cosmetic or device.

To clarify the definition of advertising under the Act, Health Canada has issued guidelines titled "The Distinction between Advertising and Other Activities."4 The guidelines attempt to clarify the distinction between advertising to promote the sale of a drug and activities that are not primarily intended to promote the sale of a drug. These non-promotional activities include education, scientific exchange, labeling and shareholder reports. The distinction is drawn by determining the primary purpose of the message through a variety of factors, including the context in which the message is disseminated, the primary and secondary audiences, the provider of the message, the sponsor of the message, the influence exerted by the manufacturer, the frequency and repetition of the message and the actual content of the message. Thus, although advertising of unapproved drugs, uses and devices is prohibited, information regarding these unapproved therapeutic products may be presented at international conferences provided this is done through a non-promotional activity. Displaying an unapproved drug or off-label use may constitute a non-promotional activity if the following four factors are present:

  1. First, the conference must clearly be an international event in that a significant proportion of the conference delegates must be from other jurisdictions.
  2. Second, the promotional material must emanate from the parent company of the manufacturer.
  3. Third, the material must be for use only within the confines of the conference.
  4. Fourth, the material is prominently identified as not being authorized for sale in Canada.

Although there is no corresponding guideline for medical devices, the guideline can be a helpful reference for manufacturers planning to advertise unapproved medical devices.

Failure to comply with the legislative requirements for drug or device advertising in Canada is a criminal offence, punishable by up to three years imprisonment and/or a fine of up to C$5,000. In addition, the Minister may penalize non-complying manufacturers by refusing licenses or creating regulatory difficulties. A new federal bill was recently introduced to allow the Minister to take stronger action.

There are also more general laws that apply to advertising. The federal Competition Act, which prohibits misrepresentation to the public, and various provincial consumer acts must be considered when promoting unapproved products.

In addition, various industry associations have adopted self-regulating measures. The Pharmaceutical Advertising Advisory Board (PAAB), an independent multidisciplinary body that reviews and approves drug advertising and promotional materials, administers the PAAB Code of Advertising Acceptance. In theory, compliance with the PAAB Code is voluntary although it is strongly encouraged by Health Canada. The PAAB has a complaint procedure that is usually instigated by competitors complaining about activities of other industry members. Similarly, MEDEC is an industry association comprising companies from the medical devices industry. MEDEC has a Code of Conduct that applies to the promotion of devices, and members are encouraged to practice ethical business activities and not to use any unlawful inducements to promote their products.

Useful Tips

Pharmaceutical companies intending to advertise unapproved products or uses at an international conference in Canada may find the following list of practical tips useful.

  • Advertising, Displaying and Promoting Products and Uses
  1. If a pharmaceutical company is advertising a product or use that is approved in Canada but not in all attendees' jurisdictions, including the United States, Health Canada's position is that the product or use can be advertised, displayed and promoted at the conference, and indeed within Canada, provided that the claims made are consistent with the Canadian product's approval. Health Canada is unlikely to penalize the promotion of products that are unapproved in foreign attendees' jurisdictions.5 In practice, at an international conference, some companies include in the promotional material a statement that the product may not be approved outside Canada. However, Health Canada does not require that such statements be included.
  2. If a product or use is unlicensed in Canada but licensed in the United States, a company must indicate on the marketing material or at the booths that the products or uses are "not authorized for use within Canada" as required by Health Canada guidelines.
  3. If a device is unapproved anywhere in the world, the product may be displayed within the confines of the conference provided that the product is prominently identified as not being authorized for sale in Canada. Health Canada has provided no guidance concerning the placement and appearance of a disclaimer that will satisfy the requirement that the materials "prominently identify" the product or use as not being authorized for sale in Canada. To meet the requirement, the disclaimer must be likely to come to the attention of the reader. Often, the disclaimer is positioned immediately below the unapproved claim, in the same font size as the unapproved claim.
  • Discussion with Customers
  1. Note that the content of discussions with customers will depend on whether the customer is from Canada or the United States. A sales representative who is speaking to a U.S. customer about a product or use approved only in the United States may discuss the product or use with the American customer, in compliance with U.S. laws regarding advertisement of the product.
  1. The sales representative may not discuss with a Canadian attendee a product or use that is not approved in Canada. If, however, the Canadian customer makes an unsolicited request for information about the off-label use, the sale representative would refer the Canadian customer to a scientific affairs representative for further discussion. That person would then be permitted to discuss the unapproved product or use in response to the unsolicited question.
  2. A log would be kept of all unsolicited requests for information documenting the specific request, the name of the individual requesting the information and the fact that the information is being provided in response to the request. Although a scientific affairs person may respond to an unsolicited question about information regarding an unapproved product or use, that person should not solicit conversation regarding an unapproved product or use because this would be considered promotion of an unapproved product or use.
  • Posters
  1. Posters that refer to a product or product use before it is authorized in Canada are permissible in the context of an international conference provided that the materials prominently identify the product or use as not being authorized for sale in Canada as set out in Health Canada's guidelines.
  • Reprints of Articles and Abstracts
  1. Reprints of articles or abstracts on unapproved products or uses should be distributed only in response to an unsolicited request for information. The reprints or abstracts should not be on display at the booth but should be concealed either under the table or behind the booth. Both a sales representative and scientific affairs person can distribute reprints or abstracts in response to unsolicited questions, but the sales representative should not engage the customer in any discussion and should instead steer the customer to scientific affairs.

Conclusion

Pharmaceutical and medical device companies advertising their products at international conferences held in Canada may wish to have regard to the above factors when preparing their advertising. Such an approach would be prudent, given the strong stance that regulators take against off-label promotion.

Footnotes

1 The DOJ enforces the criminal provisions of the Food, Drug and Cosmetic Act. Offenders may also be prosecuted under the Anti-Kickback statute and the False Claims Act.

2 The prosecution of Jazz Pharmaceutical Inc. illustrates the extent to which penalties, both civil and criminal, can be levied against guilty parties. As part of the settlement on July 13, 2007, Jazz paid $20 million dollars and admitted that its subsidiary Orphan Medical Inc. engaged in a scheme to expand the market for Xyrem by promoting off-label use to physicians. The indictment of the Swiss corporation Serono S.A. and its U.S. subsidiaries in December 2005, while less recent, serves as a warning regarding the size of the fines. The corporation paid $704 million to resolve criminal charges and civil liability for several illegal schemes to promote and sell its drug, Serostim, which was approved in 1996 to treat Auto-Immune Deficiency Syndrome (AIDS) wasting.

3 Food and Drug Act, R.S.C., 1985, c. F-27.

4 Health Canada, The Distinction Between Advertising and Other Activities (Oct. 4, 2005), available at www.hc-sc.gc.ca/dhp-mps/alt_formats/hpfb-dgpsa/ pdf/advert-publicit/actv_promo_vs_info-eng.pdf.

5 The Act excludes from its jurisdiction drugs exported for sale that indicate that Health Canada would not have jurisdiction over drugs sold or offered for sale in any country other than Canada. International regulatory authorities of countries in which the drug or uses are not approved are unlikely to attempt to enforce their laws at international conferences outside their geographic boundaries. There is no evidence that DOJ officials are either asking Health Canada to attend the conference on their behalf to help with enforcement or actually attending the conference to assert jurisdiction within Canada. No notices of this type of enforcement appear on Health Canada's website.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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