Pharmaceutical Company Gifts: From Voluntary Standards to Legal Demands
Dresser, Rebecca, The Hastings Center Report
For a long time, medical ethicists have urged the medical profession to alter its relationship with the pharmaceutical industry. Individual physicians, medical organizations, and academic institutions have taken some steps toward reform, but problems remain. Now state and federal governments, dissatisfied with the profession's efforts at self-regulation, are pressing for further change.
Three Government Interventions
One federal and two state initiatives illustrate different ways authorities are trying to discourage certain arrangements between industry and clinicians prescribing drugs to patients. In 2003, the Department of Health and Human Services Office of Inspector General (OIG) issued provisions intended to alert pharmaceutical companies and physicians to activities that could trigger prosecution under federal laws prohibiting "kickbacks" and false reimbursement claims related to the Medicare and Medicaid programs. (1)
The OIG guidance document advised pharmaceutical companies to establish compliance programs that promote ethically and legally acceptable conduct among marketing staff and clinicians. Although presented as suggestions rather than as binding standards, the OIG guidance puts companies on notice that once-common "remunerative relationships" are now legally suspect. According to the guidance, industry "gifts, entertainment and personal services ... have a high potential for fraud and abuse and, historically, have generated a substantial number of anti-kickback convictions." The potential for violations exists whenever a manufacturer supplies goods or services with the aim of inducing health professionals to prescribe the company's drug. Legal authorities may label such arrangements bribery and related reimbursement claims fraudulent. The legal risks increase with the value of the benefit and its potential impact on clinicians' behavior.
Certain states have also intensified their oversight of drug company gifts. In 2005, California began requiring companies to adopt compliance programs consistent with the 2003 OIG guidance. The California statute also requires companies to set a specific dollar limit every year on the value of gifts and incentives provided to individual health professionals. (2) In 2001, Vermont passed a Gift Disclosure Law that requires companies to file annual reports with the state attorney general, disclosing the "value, nature, and purpose of any gift, fee, payment, subsidy, or other marketing activities [to individuals and organizations] authorized to prescribe, dispense, or purchase prescription drugs in this state." (3) Economic benefits over twenty-five dollars must be reported. Other states, including Maine and Minnesota, have similar reporting laws, and more state lawmakers are considering such legislation. (4)
Besides imposing an obligation to report corporate expenditures, the Vermont law requires drug companies to report the names of health professionals and organizations receiving marketing benefits. The attorney general releases much of this information to the public, and in 2005, he announced that in the previous year, companies had spent $3.11 million in Vermont on gifts and related marketing. Merck, Amgen, GlaxoSmithKline, Forest Pharmaceuticals, and Lilly, the top marketers, spent 72 percent of the total amount. Hospitals received the highest amounts, followed by psychiatrists and pharmacists. Not all marketing recipients were named, however, because state officials honored requests from some companies to withhold this information on grounds that it constituted a trade secret. The consumer group Public Citizen has filed a lawsuit challenging this decision. (5)
The Underlying Concerns
These legal actions were triggered by worries about the conflict of interest that exists when pharmaceutical companies offer benefits to physicians and others with control over medication purchases. The patient's interests should guide treatment decisions, and clinicians should focus on the patient's condition and personal circumstances when discussing medical options. Pharmaceutical company gifts can generate biases for particular products, leading professionals to prefer those products for reasons other than patient welfare. Such gifts can also raise health care costs, for companies usually promote patent-protected products that might be no better for patients than lower-cost generic drugs. Marketing can also promote clinician preferences for drugs over other less risky or expensive approaches, such as changes in diet and exercise.
Although clinicians often deny the possibility of inappropriate bias, experiments in social psychology show that self-interest influences human evaluations of fairness. This research also indicates that conscious attempts to avoid biased judgments are ineffective: "even when individuals try to be objective, their judgments are subject to an unconscious and unintentional self-serving bias." (6) This observation about human behavior in general is backed by studies finding an association between pharmaceutical marketing efforts and changes in prescribing practices that favor the company's product, even when it offers no benefit over other available drugs. (7) Thus, a clinician may believe she is presenting an unbiased description of options when in fact her discussion is slanted in favor of a product.
Self-Regulation and Its Critics
At the same time that legal authorities have moved for more rigorous restrictions, the pharmaceutical industry and professional organizations have adopted new standards. In 2002, for example, the Pharmaceutical Research and Manufacturers of America (PhRMA) issued its Code on Interactions with Health Care Professionals. (8) Like an earlier American Medical Association Ethics Opinion, (9) the PhRMA code says that industry gifts should be educational or otherwise related to patient care. According to the code, gifts to individual clinicians should be useful professional items or services, and their value should not exceed one hundred dollars. Companies should not use support for continuing medical education and independent conferences to promote programs partial to their products.
Legal authorities see the PhRMA code as establishing minimal standards. The OIG guidance declares that those complying with the PhRMA code will "substantially reduce the risk of fraud and abuse." The California law, too, requires manufacturers to adhere to the PhRMA code. The question is whether the code, and the laws invoking it, go far enough. Critics insist that practices acceptable under the code are detrimental to patients and to the nation's interest in good, affordable health care. They contend that the code's incremental reforms are mere window-dressing and that certain practices allowed under the code should instead be prohibited.
Advocates of strong reform support a ban on all promotional gifts to physicians and other prescribing clinicians. Another target is corporate involvement in medical education. Strong reformers oppose all industry-paid meals and other funding for medical school and professional educational activities. To ensure independence, they say, drastic separation between marketing and teaching is needed. (10)
Besides supporting bans on certain practices, strong reformers want to institute new programs to diminish or replace industry activities. A push for "academic detailing" (also known as "counterdetailing") is part of their effort. These programs are designed to supply doctors with independent, evidence-based information about drugs to counter the presentations of sales representatives and other corporate information sources. A variety of approaches are used in different countries, but each "assesses the evidence about a drug's effectiveness with a perspective of open-minded skepticism." (11)
It is also possible that a newer generation of physicians will be more willing to dispense with industry ties. The American Medical Student Association (AMSA) endorses the abolition of industry gifts, industry-funded meals and lectures, and industry-sponsored continuing medical education. Students who sign its "PharmFree Pledge" commit "to accept no money, gifts, or hospitality from the pharmaceutical industry; to seek unbiased sources of information and not rely on information disseminated by drug companies; and to avoid conflicts of interest in my medical education and practice." (12) Perhaps early exposure to the controversy over lavish meals and other excessive offerings will reduce future physicians' tolerance for pharmaceutical company marketing. At the same time, however, a recent survey found that 80 percent of the responding medical students believed they were sometimes entitled to gifts and lunches from drug companies. (13)
Federal and state officials seeking to promote competent medical care and reasonable drug prices have imposed new restrictions in part because the purely voluntary approach to ethical conduct has fallen short. Ongoing public anger about drug prices and safety, together with the federal government's growing role as a major drug purchaser, suggest that further regulatory restrictions could follow. (14)
(1.) Department of Health and Human Services Office of Inspector General, OIG Compliance Program Guidance for Pharmaceutical Manufacturers, Federal Register 68 (2003): 23,731-43.
(2.) Calif. Health and Safety Code sec. 119400-02 (2005), at http://wwww.leginfo. ca.gov.
(3.) Vt. Stat. Ann. tit. 33, sec. 2005 (2004), at http://www.atg.state.vt.us.
(4.) A. Robeznieks, "More States Consider Laws for Reporting Industry Gifts," American Medical News, May 9, 2005.
(5.) Public Citizen, "Public Citizen Files Suit to Obtain Information Gathered under Vermont's Pharmaceutical Marketing Disclosure Law," August 29, 2005, at http://www.citizen.org.
(6.) J. Dana and G. Loewenstein, "A Social Science Perspective on Gifts to Physicians from Industry," Journal of the American Medical Association 290 (2003): 252-55.
(7.) D. Blumenthal, "Doctors and Drug Companies," New England Journal of Medicine 351 (2004): 1885-90.
(8.) Pharmaceutical Research and Manufacturers of America, "Code on Interactions with Health Professionals," 2002, at http://www. phrma.org/publications/policy/2004-0119.391.pdf.
(9.) American Medical Association, "Ethical Opinions and Guidelines," updated 2005, http://www.ama-assn.org/ama/pub/ category/print/4001.html.
(10.) T. Brennan et al., "Health Industry Practices That Create Conflicts of Interest," Journal of the American Medical Association 295 (2006): 429-33.
(11.) J. Avorn, Powerful Medicines: The Benefits, Risks, and Costs of Prescription Drugs (New York: Knopf, 2004), 338.
(12.) American Medical Student Association, "Towards a PharmFree Profession," April 28, 2005, at http://www.amsa.org/prof/history. cfm.
(13.) F. Sierles et al., "Medical Students' Exposure to and Attitudes about Drug Company Interactions," Journal of the American Medical Association 294 (2005): 1034-42.
(14.) D. Studdert, M. Mello, and T. Brennan, "Financial Conflicts of Interest in Physicians' Relationships with the Pharmaceutical industry--Self-Regulation in the Shadow of Federal Prosecution," New England Journal of Medicine 351 (2004): 1891-1900.…
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Publication information: Article title: Pharmaceutical Company Gifts: From Voluntary Standards to Legal Demands. Contributors: Dresser, Rebecca - Author. Journal title: The Hastings Center Report. Volume: 36. Issue: 3 Publication date: May-June 2006. Page number: 8+. © 1999 Hastings Center. COPYRIGHT 2006 Gale Group.