Internal Controls for Sunshine Reporting: What Compliance Teams Overlook the Most
Table of content
Author
Sabrina Morgan is the Head of Global Compliance & Customer Delivery at Vector Health. She oversees global transparency reporting and international disclosure requirements along with the Italian Sunshine Act strategy. She also leads the global client delivery team dedicated to data integrity, compliance solutions, and regulatory alignment for pharmaceutical and MedTech organizations.
Vector Health Compliance
Your Leading Partner in Global Sunshine Compliance
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Transparency reporting isn’t just a compliance obligation, it’s an operational discipline that demonstrates integrity across the life sciences sector. Whether your organization reports under Open Payments in the U.S., discloses in line with the EFPIA Code in Europe, complies with Loi Bertrand in France, the Italian Sunshine Act (Law 62/2022) in Italy, or national registries across Asia-Pacific, the same challenge applies: internal controls determine the reliability of your data and, ultimately, your credibility with regulators.
Even mature compliance teams with automated systems and established reporting partners continue to miss critical control points. These weaknesses don’t always cause immediate submission errors, but they slowly erode data quality, create inconsistencies between countries, and heighten audit risk.
Here are the most frequently overlooked internal controls that matter globally, and practical ways to strengthen them.
1. Uncaptured Spend from Decentralized Functions
The greatest risk in transparency reporting isn’t what’s disclosed, it’s what’s missed. Activities such as investigator-initiated trials, medical education programs, or local market sponsorships often sit outside corporate finance or expense systems. Affiliates or third-party agencies may manage these spends independently, leaving large reporting gaps.
Control fix: Conduct quarterly mapping of all potential spend sources, including affiliate budgets, grant programs, and vendor-managed events. Assign clear data ownership for each feed and implement automated interfaces wherever possible. A “spend completeness check” should be a formal step in every reporting cycle.
2. Stale or Mismatched HCP/HCO Master Data
Accurate identification of recipients – physicians, hospitals, associations – is central to every regime, yet master data remains a top failure point. Inconsistent identifiers, outdated licensing details, and duplicate profiles lead to misattributed or fragmented spend. In multi-country setups, the same HCP might appear under several variations.
Control fix: Establish a single, validated master data source shared across systems. Use automated reconciliation against official registries (e.g., NPPES in the U.S., RPPS in France, national medical councils elsewhere). Implement fuzzy matching and exception alerts, and perform at least semi-annual master data audits.
3. Poor Segregation of Duties
A common structural weakness is that the same team collects, validates, and approves data. Without independent review, human error and unconscious bias creep in, especially when business functions are under pressure to meet deadlines. Regulators view this as a sign of inadequate internal governance.
Control fix: Define a clear maker-checker-approver model. Operational teams prepare the data, Compliance reviews for completeness and rule alignment, and an independent function (such as Internal Audit or Data Quality) provides final sign-off. Embed this workflow into reporting systems so every approval leaves a digital trail.
4. Inconsistent Policy Interpretation
Transparency rules differ widely: EFPIA allows certain meal thresholds; South Korea sets caps by payment type; Japan requires disclosure by product category. Yet within multinational companies, affiliates often interpret the same rule differently. These inconsistencies can create fragmented disclosures and regulatory questions about control oversight.
Control fix: Maintain a global policy interpretation matrix capturing thresholds, exemptions, and country-specific definitions. Train affiliate compliance leads on consistent application and update the matrix annually. Where possible, hard-code these parameters into expense and CRM systems so controls operate automatically, not subjectively.
5. Indirect Payments Through Vendors and Partners
Indirect transfers of value – through event agencies, logistics partners, or CROs – are a growing global scrutiny point. Regulators increasingly ask whether companies can trace payments made “on their behalf.” If vendor data is incomplete, organizations may unknowingly underreport.
Control fix: Include explicit transparency-reporting obligations in all vendor contracts, requiring itemized HCP/HCO-level disclosure. Perform periodic reconciliation of vendor invoices with internal data and escalate any mismatches. Strong vendor controls show regulators that indirect spending is actively managed.
6. Missing Post-Submission Review
After reports are submitted, most teams move immediately into planning for the next cycle. But without a structured lookback, errors persist year after year. A post-submission audit is one of the simplest ways to demonstrate continuous improvement, a principle common across global frameworks.
Control fix: Within 60 days post-submission, review a representative sample of transactions across multiple countries. Verify each against source documentation and categorize root causes. Feed those findings into training, SOP updates, or system enhancements before the next reporting period.
7. Lack of Continuous Data Monitoring
Transparency reporting is cyclical, but data quality should be continuous. Without metrics tracking data completeness, timeliness, and error rates, compliance teams are flying blind between reporting deadlines.
Control fix: Implement global dashboards monitoring key control indicators, data load freshness, validation error trends, and exception resolution time. Share these metrics monthly with Compliance and Finance leadership to drive accountability and early remediation.
The Takeaway
Transparency obligations vary by jurisdiction, but strong internal controls are universal. They protect organizations from non-compliance, reduce manual rework, and build confidence among regulators, partners, and the public.
The most effective compliance teams go beyond meeting deadlines. They create a living control framework that learns, tests, and evolves. In a landscape where disclosure expectations keep expanding, control maturity is the real measure of compliance readiness.
Table of content
Transparency reporting isn’t just a compliance obligation, it’s an operational discipline that demonstrates integrity across the life sciences sector. Whether your organization reports under Open Payments in the U.S., discloses in line with the EFPIA Code in Europe, complies with Loi Bertrand in France, the Italian Sunshine Act (Law 62/2022) in Italy, or national registries across Asia-Pacific, the same challenge applies: internal controls determine the reliability of your data and, ultimately, your credibility with regulators.
Even mature compliance teams with automated systems and established reporting partners continue to miss critical control points. These weaknesses don’t always cause immediate submission errors, but they slowly erode data quality, create inconsistencies between countries, and heighten audit risk.
Here are the most frequently overlooked internal controls that matter globally, and practical ways to strengthen them.
1. Uncaptured Spend from Decentralized Functions
The greatest risk in transparency reporting isn’t what’s disclosed, it’s what’s missed. Activities such as investigator-initiated trials, medical education programs, or local market sponsorships often sit outside corporate finance or expense systems. Affiliates or third-party agencies may manage these spends independently, leaving large reporting gaps.
Control fix: Conduct quarterly mapping of all potential spend sources, including affiliate budgets, grant programs, and vendor-managed events. Assign clear data ownership for each feed and implement automated interfaces wherever possible. A “spend completeness check” should be a formal step in every reporting cycle.
2. Stale or Mismatched HCP/HCO Master Data
Accurate identification of recipients – physicians, hospitals, associations – is central to every regime, yet master data remains a top failure point. Inconsistent identifiers, outdated licensing details, and duplicate profiles lead to misattributed or fragmented spend. In multi-country setups, the same HCP might appear under several variations.
Control fix: Establish a single, validated master data source shared across systems. Use automated reconciliation against official registries (e.g., NPPES in the U.S., RPPS in France, national medical councils elsewhere). Implement fuzzy matching and exception alerts, and perform at least semi-annual master data audits.
3. Poor Segregation of Duties
A common structural weakness is that the same team collects, validates, and approves data. Without independent review, human error and unconscious bias creep in, especially when business functions are under pressure to meet deadlines. Regulators view this as a sign of inadequate internal governance.
Control fix: Define a clear maker-checker-approver model. Operational teams prepare the data, Compliance reviews for completeness and rule alignment, and an independent function (such as Internal Audit or Data Quality) provides final sign-off. Embed this workflow into reporting systems so every approval leaves a digital trail.
4. Inconsistent Policy Interpretation
Transparency rules differ widely: EFPIA allows certain meal thresholds; South Korea sets caps by payment type; Japan requires disclosure by product category. Yet within multinational companies, affiliates often interpret the same rule differently. These inconsistencies can create fragmented disclosures and regulatory questions about control oversight.
Control fix: Maintain a global policy interpretation matrix capturing thresholds, exemptions, and country-specific definitions. Train affiliate compliance leads on consistent application and update the matrix annually. Where possible, hard-code these parameters into expense and CRM systems so controls operate automatically, not subjectively.
5. Indirect Payments Through Vendors and Partners
Indirect transfers of value – through event agencies, logistics partners, or CROs – are a growing global scrutiny point. Regulators increasingly ask whether companies can trace payments made “on their behalf.” If vendor data is incomplete, organizations may unknowingly underreport.
Control fix: Include explicit transparency-reporting obligations in all vendor contracts, requiring itemized HCP/HCO-level disclosure. Perform periodic reconciliation of vendor invoices with internal data and escalate any mismatches. Strong vendor controls show regulators that indirect spending is actively managed.
6. Missing Post-Submission Review
After reports are submitted, most teams move immediately into planning for the next cycle. But without a structured lookback, errors persist year after year. A post-submission audit is one of the simplest ways to demonstrate continuous improvement, a principle common across global frameworks.
Control fix: Within 60 days post-submission, review a representative sample of transactions across multiple countries. Verify each against source documentation and categorize root causes. Feed those findings into training, SOP updates, or system enhancements before the next reporting period.
7. Lack of Continuous Data Monitoring
Transparency reporting is cyclical, but data quality should be continuous. Without metrics tracking data completeness, timeliness, and error rates, compliance teams are flying blind between reporting deadlines.
Control fix: Implement global dashboards monitoring key control indicators, data load freshness, validation error trends, and exception resolution time. Share these metrics monthly with Compliance and Finance leadership to drive accountability and early remediation.
The Takeaway
Transparency obligations vary by jurisdiction, but strong internal controls are universal. They protect organizations from non-compliance, reduce manual rework, and build confidence among regulators, partners, and the public.
The most effective compliance teams go beyond meeting deadlines. They create a living control framework that learns, tests, and evolves. In a landscape where disclosure expectations keep expanding, control maturity is the real measure of compliance readiness.
Author
Sabrina Morgan is the Head of Global Compliance & Customer Delivery at Vector Health. She oversees global transparency reporting and international disclosure requirements along with the Italian Sunshine Act strategy. She also leads the global client delivery team dedicated to data integrity, compliance solutions, and regulatory alignment for pharmaceutical and MedTech organizations.
Vector Health Compliance
Your Leading Partner in Global Sunshine Compliance
Cerchi supporto per la compliance al Sunshine Act?
Hai domande pratiche?
Dai un’occhiata alla nostra sezione Domande Frequenti per risposte chiare su scadenze, obblighi e strategie.