Drug Company Payments Still a Public Secret

March 21, 2007 — -- Despite laws created to specifically identify the financial gifts doctors receive from pharmaceutical companies, major obstacles remain in providing that information to the public.

Currently, five states and Washington, D.C., require that payments the pharmaceutical industry makes to doctors be reported. Only two states, Vermont and Minnesota, provide that data to the public.

In a first of its kind study from the Journal of the American Medical Association, researchers looked at the records from these two states from 2002 to 2004 to examine how their laws have been executed.

Surprisingly, their findings reveal these payments often involve substantial sums, and the details of the transactions remain vague or unavailable.

Laws Aren't Working

The intention of this study was to find a true examination of how money changes hands between the medical and pharmaceutical industries.

"What we really found was laws aren't working," says study author Joseph Ross, an instructor in the department of geriatrics at the Mount Sinai School of Medicine in New York.

"We knew there would be substantial sums of money changing hands between doctors and companies," he says. "What was surprising was how poorly information was made available to the public, to researchers, to anyone."

Ross describes obstacles in obtaining records that made the process virtually impossible, or left the team with vaguely worded explanations.

It was slowly revealed that where states were trying to promote disclosure, drug companies were circumventing the law.

Purpose of Payment

"Once you actually get to data, you notice vague terms in description of gift purpose," says Ross.

Payments that are made to physicians that involve drugs or items not yet on the market, are exempt under the term "trade secret" in Vermont.

For example, when the company GlaxoSmithKline publicly revealed its total value of payments from 2002 through 2004, it claims zero dollars spent.

Yet, during that same period, Vermont's attorney general cited the drug giant as making more payments to doctors than any other pharmaceutical company in the state.

The reason for the discrepancy: GlaxoSmithKline designated all of its payments as trade secrets.

Similar inconsistencies were seen in Minnesota as well. The company Amgen was noted as paying doctors zero dollars in 2002 and zero dollars in 2004. In 2003, however, Amgen disclosed more than $4 million in payments.

"To designate every payment made as a trade secret … seems improbable," says Ross.

What was most surprising to the researchers was the lack of resources maintaining these laws. "There is no enforcement, no follow-up," notes Ross. "No one has examined these documents."

Public Deserves to Know

These are just two examples of what is clearly a problem in the effort to reveal where these dollars are going.

"They prefer not to put into the public domain what doctors they're sharing this information with," says Dr. Harlan Krumholz, an associate professor at the Yale University School of Medicine. "That allows drug companies to withhold information."

If your doctor is getting money from a company for which he or she writes prescriptions, "the public should know," he says.

When doctors are given free pens or writing pads by a drug sales representative, the act seems harmless.

But the practice of sending physicians on expensive vacations or treating them to lavish meals raises more ethical questions.

When that doctor returns to the office and prescribes that company's drug, does he or she do that with the patient's best interest in mind?

"There is a lot of money changing hands," says Krumholz. "The legislation building on the path of experience needs to improve."

To do that, the relationship between the doctors and the pharmaceutical companies needs to become transparent.

"If both parties think this payment is appropriate," says Ross, "then this information should be made available to the public."