Drug Firms Paying Doctors

When a doctor prescribes a medication to a patient, most patients don’t question how much the doctor knows about the drugs, or where they got their information.

When I investigated medical malpractice claims, I was usually the only person in the doctor’s waiting room in a suit. Unless there was a drug rep there. We’d smile at each other, and the drug rep would sometimes ask what drug company I was from. I wasn’t allowed to tell them I represented the doctor’s professional liability carrier. I just said I was there on business. I’d hand my card to the receptionist and the rep would look annoyed when I got called back before he or she did.

Drug reps are one way that doctors learn about drugs. These reps, often attractive, young men and women, tote in samples, pamphlets, candy and often lunch (I benefitted from this food too – sometimes the doctor and I would grab sandwiches to eat during our discussion, or they’d give me pastries to take home).

Doctors are in on the goods too. A recent investigation by ProPublica detailed how. For example, over 18 months, seven New Jersey physicians were paid between $100,000-$212,000 to talk up specific pharmaceutical products in medical conventions, conferences, consulting and lunch-and-learns.

This is not news in the industry, but bringing the actual numbers to the public eyes is a good way to question the ethics.

Earlier this year, NPR’s Fresh Air had an interesting interview with Dr. Daniel Carlat. He wrote the book Unhinged: The Trouble with Psychiatry – A Doctor’s Revelation about a Profession in Crisis.

The book topic merits its own blog post (the premise being that many doctors are abandoning talk therapy and just prescribing medications, partly due to time and financial issues). In the Fresh Air interview, Dr. Carlat talks bout his experience getting paid by Wyeth to give other doctors information about depression and its treatment, including the use of Effexor (that part of the interview starts at 25:17). When he started doing these lunch-and-learns, he was getting paid to tell doctors what he already believed about treating depression, and using Effexor as part of that (along with a slide deck supplied by Wyeth). Dr. Carlat’s message coincided with Wyeth’s marketing message.

As time went by, Dr. Carlat realized he was being influenced by the payments, and found himself embellishing Effexor’s positive effects, and diminishing his talk of side effects. He felt the pressure from having the drug rep in the room listening to him, and felt he needed to keep up the positive talk if he wanted to keep earning money from these “educational” seminars. At one talk, Dr. Carlat told the doctors that the studies on Effexor’s benefits were based short term studies, and that if the studies were longer, that Effexor might not be advantageous over other options. That turned out to be his last talk. The drug company expressed concern, and Dr. Carlat realized he wasn’t useful to the company when he gave the unvarnished truth – only when he towed the line.

Listen to the whole interview here and read Dr. Carlat’s account in his New York Times Magazine story here.

To be sure, using doctor to sell to doctors in an educational format is effective. These doctors are seen as peers and thought leaders. When you see someone speak at a conference, you don’t automatically assume they’re being paid to do so (though often there’s a written acknowledgement of a financial relationship in the conference brochure). Doctors may learn something about a topic they’re less familiar with from these paid speakers. But the teaching may be unintentionally (or even intentionally) biased.

How does this affect patients? On the plus side, doctors might be better educated about a specific disease or treatment. But patients might also get prescribed a drug based on learnings from a biased seminar. Or they might be prescribed a drug without knowing that the drug company is monitoring and rewarding doctors for their prescription patterns – whether or not its the best drug for the patient.

It would be nice to think doctors are independent of this, but throw money into the mix, and it just muddies the water.

For more information:

–ProPublica broke the story with detailed analysis and databases on what pharmas paid to what doctors. Read more here:

Profiles of the top-paid doctors

Not all the doctors on pharma payroll have good credentials, according to ProPublica

New Jersey doctors on the take


2 responses to “Drug Firms Paying Doctors

  1. Thank you, D. Kaplan, for pointing out one of the major conflicts of interest in the medical business today. There are many others. One of the consequences of the current so-called health “insurance” industry is that the prices are set by negotiation between health care companies and doctors–but patients generally do not even know how much each medical procedure costs, nor is there any clear way to find out. (Have you read an EOB form lately? I get a headache just thinking about one.) All we know as patients is what the health insurance company charges us, or our employer, each month, and we are told “medicine is expensive, and getting better all the time–so it gets more expensive too.” We are told, essentially, “trust us, we your health care company know what medicine costs, and you don’t, so take our word for it.” But of course the health insurance companies do NOT have an incentive to get the right amount of medicine for the right price. No, from the point of view of the doctor and the industry, the more medicine that gets used, the better. Without knowing how much each piece costs, we the consumer are not able to exert any competitive price pressure. And we pay the same monthly premium whether we use too much medical intervention or not enough. So the incentives are skewed in favor of using too much, on all sides: doctor, patient, & health care company. The only possible outcome of this conflict of interest is that medical costs will continue to rise faster than inflation, faster than wages, and faster than the cost of living. –until we realize that we don’t have “competitive” health service pricing anymore, and try to impose some sound economic principles on a system that long ago abandoned them. But that would require separating the “routine health care” plans from the “catastrophic insurance” plans from the “chronic care” plans. Only the catastrophic care is properly called “insurance.” The other two types of care should be called collective bargaining plans rather than insurance plans, and should be handled by a separate company under a separate plan.
    If that seems too complicated, go back to your last Explanation Of Benefits (EOB) form and see if that’s really the system you want setting the prices for us.

  2. Ken – in fact I’ve looked at a lot of EOBs lately, and it’s crazy how high my out of pocket costs would be if I had to pay the entire thing myself. There’s not much “explanation” of the benefits or payments on those EOBs, just some numbers and a few words.

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