Pharmabiz
 

Pharma cos in US asked to stop financial incentives to doctors

WashingtonThursday, October 3, 2002, 08:00 Hrs  [IST]

The US government has warned pharmaceutical companies that they must not offer any financial incentives to doctors, pharmacists or other health care professionals to prescribe or recommend particular drugs, or to switch patients from one medicine to another. The government informed the industry that many practices commonly used in the marketing and sale of prescription drugs could run afoul of federal fraud and abuse laws. Specifically, the government said that drug makers could not offer incentive payments or other "tangible benefits" to encourage or reward the prescribing or purchase of particular drugs by doctors, health plans or companies that manage drug benefits for employers and insurers. The new standards, the first of their kind, were issued by Janet Rehnquist, inspector general of the Department of Health and Human Services, as guidance to the pharmaceutical industry. Aggressive marketing is the norm in the industry. For years, drug makers have treated doctors to free Broadway plays, weekend trips, expensive meals and other lavish perks. Many companies have rewarded middlemen, or pharmacy benefit managers, for putting their products on lists of recommended drugs, known as formularies. Some companies have also rewarded doctors and drugs stores for switching patients from one medication to another. Similarly, doctors in a position to influence the prescribing of drugs for large numbers of patients have been retained as advisers and consultants to drug manufacturers. While the new standards do not have the force of law, drug makers that flout them are more likely to be investigated and prosecuted for violations of federal fraud and kickback statutes. "In today''s environment of increased scrutiny of corporate conduct and increasingly large expenditures for prescription drugs," Ms. Rehnquist said, "it is imperative for pharmaceutical manufacturers to establish and maintain effective compliance programmes." The public will have 60 days to comment on the standards. The government may revise them in the light of those comments. The government said it was concerned about the industry''s marketing practices because they could improperly drive up costs for Medicare and Medicaid, the federal health programmes for 75 million people who are elderly, disabled or poor. The federal government spends $400 billion a year on the two programs combined, and the cost is expected to double in 10 years.

 
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