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.

Is Pharmaceutical Promotion Protected by Free Speech?

Recently, the New England Journal of Medicine published this interesting Sounding Board article by Aaron S. Kesselheim and Jerry Avorn, both of whom are physicians at Brigham and Women’s Hospital and Harvard Medical School. They are leading proponents of efforts to limit the use of prescription data-mining, and assisted the state of New Hampshire in its ultimately unsuccessful efforts to ban the practice (see this article for some background on various legislative actions).

At issue is whether prescription data-mining and other promotional activities are considered “free speech” and thus protected by the First Amendment. This has been a major argument of the pharmaceutical industry in its ongoing litigation in several states that are considering bans.

The authors distinguish personal speech, which is strongly protected by the First Amendment, from commercial speech. Whereas any limitation on individual free speech requires that the government have a clear interest in limiting a particular person’s speech (a high legal standard that is rarely met), limitations on commercial speech are based on different standards. The main framework used by courts is called the “Central Hudson Test,” after a 1980 case in which a utility company sued New York State over regulation of their advertising.

Based on that case, courts now allow limitations on commercial speech if three conditions are met. First, the government must have a substantial interest in the issue (in the case of prescription data-mining, the government indeed has a substantial interest in the relevant issue, which is public health); second, the proposed regulation must directly advance those interests (banning data-mining reduces the potential for non-scientifically based physician prescribing behavior); and third, the proposed regulation must not be more extensive than necessary to achieve its goals (the New Hampshire courts ruled against the ban partly because it agreed with Pharma arguments that there are less restrictive ways to counteract drug company misinformation, such as programs to better educate doctors about evaluating promotional claims).

I found this a valuable article for understanding some of these issues. Happy reading!

For Relief from Pharma Influence, Visit Vermont

I suppose I should not be surprised that Vermont is doing so much to combat inappropriate drug company influence. After all, the state is famous for liberal physicians, including, most prominently, the current chairman of the Democratic National Committee, Howard Dean.

I recently gave a talk (as part of my “Dirty Thirty” tour) to the Vermont Psychiatric Association. What an impressive group. These are psychiatrists who are in the profession to help their patients, no matter what it takes, and are refreshingly unwedded to the medication solution. For example, Alice Silverman, one of the association's representatives to the APA, no longer starts with antidepressants when treating mild depression, because she has found therapy to be just as helpful. Her patients are happy because they don't have to deal with either sexual dysfunction or a higher risk of osteoporosis.

Also present was David Fassler, the incoming secretary-treasurer of the APA. I look forward to working with him on the newly formed APA Work Group to figure out who to wean ourselves off of industry money.

Vermont is absolutely at the forefront of the growing movement to wrest control of medicine away from the pharmaceutical industry. The legislature has passed a law restricting prescription data-mining; the University of Vermont Medical School has banned drug company gifts or meals; and the Vermont Association of Mental Health has just said "no" to industry support. To read more about what Vermont is doing, read this excellent overview article in the Barre Montpellier Times Argus.

A Drug Rep Tells All

Shahram Ahari, former Eli Lilly drug rep, recently spoke to the Tufts Progressive Medical Students Organization. It was a fascinating talk, because Ahari told us about how he and his colleagues used every trick of salesmanship in the book to increase prescriptions of Prozac and Zyprexa and therefore to maximize their bonuses.
The key criteria of employment as a drug rep, he said, are being good looking and mastering the art of small talk. No huge surprise here, but it’s helpful to remember that drug reps do not come to doctors to educate, but rather to persuade.

"Gift giving is the key," he said. "You are programmed as a human to reciprocate. You feel obliged to return the favor. As a matter of fact, the smaller the gift, the greater the sense of obligation."

Do you consider samples to be a part of the company’s civic duty? Think again. "Samples are a marketing tool. They always have strings attached. Typically, we would provide two weeks worth of samples, which worked out wonderfully. Just like a drug dealer, the first one is free, and then you’re hooked."

A member of the audience who had once been a consultant to industry made an interesting comment about samples. His job was to track doctors’ prescribing behavior in response to sampling practices, and to provide physician-specific "response curves" to companies. Using these curves, reps determined how to maximize their "return" on sampling. If you "hit" Doctor Smith 10 times per year with samples, he might prescribe more product than Doctor Jones, who might require less sampling. To drug companies, doctors are pawns in a game of cost-benefit analysis.

Ahari recalls well that food makes doctors more receptive to the message. "We took painstaking efforts to determine what you like. We had a $60,000 budget for food, and we used this to make ourselves seem a necessity to clinics who wanted to make their staff happy."

But food pales compared to what Ahari called "the most sinister tool in our armamentarium: our computer." He was referring, of course, to prescription data-mining. "We knew all your prescribing data, and we used it fine-tune our pitch."

Do you think drug reps are there to provide you with crucial medical information? Fuggedabout it! "I was in your office in order to influence you to prescribe Prozac or Zyprexa. We focussed on providing information to manipulate your prescribing, not to teach you how to treat your patients. Mostly, we wanted to build a good relationship, so that you’d like us. We are the one spot of sunshine in your day, a person who steps in the door and is actually interested in how you’re doing. We’re fun, witty, attractive, and we come bearing gifts. No wonder we’re accepted into your offices."

Prescription Data Mining: A Transparent (-ly absurd) Defense by Verispan

The arguments in favor of that latest manipulative marketing technique, prescription data-mining, come in many different hues of speciousness. I recommend you visit this excellent page on the National Physician's Alliance website to learn more.

Today, however (on a tip from PharmaGossip), I read the most absurd argument in its defense yet, reported in yesterday's Philadelphia Inquirer. The reporter, Karl Stark, quoted Jody Fisher, Verispan's vice president of product management, as saying: "Doctors are trying to create a special right of privacy. I can certainly appreciate where they're coming from. But the way the world is going is toward increased transparency of information."

"Transparency of information"! What a wonderful Web 2.0 buzz phrase!

Here's what, Jody: Let's hold hands and use that argument together on the pharmaceutical companies who are refusing to reveal their payments to doctors. And while were at it, let's extend your cutting edge concept into other areas of commerce as well. For example, groceries stores can combine customer's credit card information with their bar-coded food item data to create a goldmine of "transparent" marketing information for Kraft and Proctor & Gamble. I can't wait for the smiling cereal reps to detail me. "Mr. Carlat, I was wondering if you would consider purchasing more Great Grains Selects? We have new head-to-head data comparing it to Smart Start...."

If you haven't heard about prescription data-mining yet, here's a short course. When I was a hired gun speaker for Wyeth back in 2002, drug reps would book me speaking gigs at primary care doctor's offices. My job was simple: say whatever I possibly could to get doctors to prescribe more Effexor XR.

Before each of these "Lunch 'n Learns," as they are called, the rep would fax me a little cheat sheet about the doctor we'd be visiting. This sheet spelled out exactly how many prescriptions for which antidepressants this doctor was writing. Doctors who wrote too much Celexa and Zoloft, and not enough Effexor, were crucial "targets," and I was implicitly encouraged to give these misguided doctors a particularly hard sell.

How did the reps get such detailed information? Since the 1990s, drug companies, pharmacy information companies (such as Verispan and IMS) and the AMA have been collaborating in packaging doctor's prescription information and using it to help companies more efficiently sell their drugs. Companies like Verispan buy prescription info from local pharmacies, then they purchase identifying data on all us doctors from the AMA (which makes over $40 million a year by leasing out its physician Masterfile), and finally they turn around and sell the whole package to the highest-bidding drug companies.

Most readers of this blog have probably already heard about this latest piece slime-marketing, but doesn't it make you slightly nauseous to contemplate it again? It does for me.

Well, the word about this practice has finally hit the media, and many doctors, particularly members of the vibrant new physician's organization, National Physician's Alliance , are outraged (I know, this is the second plug I've given them in this posting; here's the subliminal message: JOIN THEM INSTEAD OF THE AMA). So far, three states, New Hampshire, Maine, and Vermont, have passed legislation curtailing the practice. However, the well-funded pharmacy information companies are planning to sue each and every state that limits prescripion data-mining. They've already succeeded in persuading a New Hampshire judge to strike down the law.

Don't worry, people. The good guys are gonna win on this one--I guarantee it!