U.S. doctors and teaching hospitals were paid $3.5 billion by drug and device makers over five months in 2013, according to the first comprehensive disclosure of the companies’ financial ties to the medical professionals that prescribe and use their products.
The disclosures by the U.S. government cover 4.4 million payments to about 550,000 doctors and 1,360 teaching hospitals from August to December 2013. The companies had to provide the information as part of the 2010 Patient Protection and Affordable Care Act, or Obamacare.
While doctors are allowed to prescribe any treatment they think will help a patient, makers of drugs and medical devices are allowed to market products only for uses the Food and Drug Administration has reviewed and approved. In some cases, companies have used their financial links to the medical community to get around that limitation, according to critics.
The payments “really have an insidious corrupting influence on the practice of medicine, research, the development of clinical guidelines and clinical practice,” said Michael Carome, the director of health research at the nonprofit watchdog group Public Citizen. “The reason companies pay physicians honoraria and give them gifts and consulting fees is ultimately to influence the prescribing practices of physicians.”
The U.S. said the motives and consequences are far more complex. The data don’t “identify which financial relationships are beneficial and which could cause conflicts of interest,” Shantanu Agrawal, director of program integrity at the Centers for Medicare and Medicaid Services, said in a statement. While the disclosure may help stop inappropriate payments, “they could also help identify relationships that lead to the development of beneficial new technologies.”
Past analyses have found that “off-label” uses made up a fifth of prescriptions, and companies have sometimes stepped over the line in what they can tell prescribers. In the past decade, drug companies paid billions of dollars in legal settlements after a series of lawsuits by the U.S. Justice Department, many of which targeted drugmakers for pushing unapproved uses of their products.
GlaxoSmithKline Plc pleaded guilty in July 2012 to illegal promotion of two drugs, including kickbacks to doctors, and failure to provide clinical data on another as part of a $3 billion settlement, the largest ever in a health-care fraud case in the U.S. The Justice Department said Glaxo paid for meals and spa treatments for doctors who attended events they were encouraged to prescribe drugs for unapproved uses.
Other drugmakers that have paid settlements after the government accused them of kickbacks or illegal promotion include Merck & Co., Amgen Inc., AstraZeneca Plc, and Pfizer Inc., which paid a $2.3 billion settlement in 2009.
While this is the first time that payments data have been required by all drug and device makers, the information released today has several shortcomings.
It covers only five months and has no historical comparison. Even within that short window, the data are also incomplete. Drug and device companies can delay reporting payments to researchers that were for the development of experimental products not yet for sale, which led to 190,000 records being withheld.
Furthermore, the government wasn’t always able to identify who was paid. About 40 percent of the records released today have been “de-identified,” meaning the name of the doctor or hospital has been removed.
De-identified data will be “completely useless,” Carome said. “The purpose is to identify specific payments to individuals and teaching hospitals. Anonymized data is meaningless data.”
Still, “despite some of the shortcomings in timing and despite some of the withholding of data, this is an important step in the right direction,” he said.
The drug payments data have been four years coming, after the Physician Payments Sunshine Act was signed into law in 2010 as part of the Affordable Care Act. Consumers will eventually be able to search the data and look up their own physician.
The roll-out of the information has been plagued by reports of technical errors.
Drug companies have had trouble uploading the data to the government’s servers, John Murphy, assistant general counsel of drug industry lobbying group, Pharmaceutical Research and Manufacturers of America, said in a telephone interview.
Physicians also complained about the process, saying CMS didn’t give them enough time to review the data that were submitted. After one doctor found payments attributed to him that belonged to another doctor with the same name, CMS temporarily suspended the website.
“The physicians had a 360-page instruction manual,” said Robert Wah, president of the American Medical Association, which represents doctors. “Then the website crashed. It was a pretty small window to review the data.”
For example, one researcher at the Mayo Clinic who was conducting company-funded research was also given a grant for work related to writing up the findings. The grant was recorded as a gift, said Richard Ehman, a professor of radiology and vice chairman of the conflict interest review board at the Mayo Clinic in Rochester, Minnesota.
“The data aren’t inaccurate so much as it’s grouped in bundles that don’t apply,” he said in a telephone interview. “Perhaps the categories aren’t specific enough. Some people have looked at the payments and feel the way it’s described isn’t accurate.”
In general, though, there haven’t been a lot of complaints from physicians, Ehman said.
“It’s the law of the land,” he said. “That’s just the way it is. The legislation originated because there were examples of lack of disclosure and lack of transparency. It’s unfortunate we have examples like that.”
Ehman said the law hasn’t caused doctors to stop working with private companies. “We’re highly engaged with the commercial sector,” he said.