Thursday, July 2, 2009

Prescription Data-Mining is Getting Battered in Court

Prescription data-mining is a marketing tool in which drug companies purchase information from pharmacies that allow them to spy on doctors' prescribing practices. The companies use this information in a variety of sneaky ways. Front line drug reps download this information to their laptops and use it to tailor their marketing pitches before they call on doctors. Higher level marketing executives use the data to craft targeted marketing campaigns involving everything from pseudo-journals to invitations to promotional dinner meetings.

It is a deceptive and quite nauseating marketing practice, but it has continued through the years because it seemed for a while that everybody stood to win. Drug companies got invaluable demographic information in order to sell the newest and most expensive drugs. Data-mining firms; like IMS, built thier entire lucrative business model on their new identities as information brokers; pharmacies reaped profits by selling prescription info to IMS and their ilk; the American Medical Association profits to the tune of several million per year by whoring out the organization and selling doctors' DEA numbers to data base firms; and finally, individual doctors in their offices started receiving dozens of invitations to fancy dinners by reps who wanted them to prescribe more of their drug.

I've lost count--I think we're up to a "win-win-win-win-win" situation.

But now this corrupt house of cards is tumbling down. Not all at once, but gradually, state by state, appeals court by appeals court.

Here are a couple of recent developments.

1. New Hampshire. In 2006, New Hampshire's legislature banned data-mining. In 2007, lawyers were able to convince a district court to strike down the New Hampshire law by arguing that buying and selling prescription information was protected by free speech safeguards. In 2008, the First Circuit Court of Appeals overturned the district court's decision, and unanimously upheld New Hampshire’s Prescription Confidentiality Act. The forces of greed do not give up easily, and the data-firm lawyers submitted their case to the United States Supreme Court. Well, a few days ago, the Supreme Court declined to consider the case, sending a message to many other states that the ban on data-mining is, in fact, constitutional.

2. Vermont. In 2008, the Vermont legislature passed a law banning prescription data-mining unless physicians specifically opt in to their data being bought and sold. Data firm lawyers descended on the Green Mountain State, and submitted an appeal to the federal Second Circuit Court of Appeals requesting that they grant an injunction blocking the implementation of Vermont's law. Twas not to be. The Appeals courts just refused to block the law.

Other data-mining provisions in other states are being contested by other attorneys, so we will continue to hear more about this issue. But the news is not good for IMS. I hope somebody there is writing out a new business plan.


Sara said...

If only data mining could be used to help people get better instead of to sell ever more treatments. This is such a corruption of what in fact could be a useful tool if used ethically and rationally but it looks like we will be throwing the baby out with the bath water because of the sordid way in which it has already been exploited.

Cetamua said...

not good for IMS?

Well...isn't that so sad! The number of useless (for the common good) corporations that will fall by the wayside is increasing.

Who's next? CME outfits?

Gina Pera said...

When I first heard about this years ago, I thought it was in light of a scandal of its discovery -- and that it would surely be halted.

Physicians must stop blaming everything on big Bad Pharma and police their own for ethics and integrity.

Anonymous said...

Don't forget, that if you are shown NOT to be a prescriber of a particular family of drugs, you are NOT targeted by pharma companies for sales calls for that family. It works both ways.

Without prescribing data to determine the most likely "targets" the sales reps will call on everyone, not just the specialist up the street. Right now, it is fairly fine-tuned, especially with pharma rep layoffs. If they have to start calling on everyone because they don't know who are viable targets, they may be recalling some of their laid-off reps to help, which means more sales calls for physicians.

You can't have your cake and eat it, too, sillies.

Gina Pera said...

Wait, anon. You're saying that physicians can't place a "no solicitations" sign on their door -- that it's data-mining or neighborhood canvassing?

Anonymous said...

And if you are a patient, you still lose, because your psychiatrist has spent more time listening to pharmaceutical company sales reps than to their patients, so they really don't know too much about what is happening to real people-- just the propaganda.

Dan said...

Pharmacies sell prescribing data, also known as prescriber-identifiable data, to the pharmaceutical industry’s providers of this information. This is known as, ‘data mining.’

The two largest data mining companies are IMS and Verispan in this 2 billion dollar or so a year data mining industry.

The data on individual prescribers is purchased by the pharmacies from the American Medical Association. As a result, this association receives between 40 and 50 billion dollars a year, which is nearly 20 percent of the AMA’s budget.

Over 1 billion prescriptions are monitored every year due to this process.

Advocates of the pharmaceutical industry have continuously told the public that this prescriber data is to facilitate the care the prescriber gives the patient.

Nothing could be further from the truth. In 10 years, I worked as a drug representative for 3 of the largest pharmaceutical companies in the world.

With each employer, the prescribing data that we had on the prescribers was used entirely to increase the market share of the drugs promoted with these companies by manipulating the prescribers targeted for financial gain of these pharmaceutical corporations.

Also, data mining is utilized by drug companies to target those who need to be gifted, and those who will not,

Dan Abshear