Healthy Skepticism Library item: 15790

Warning: This library includes all items relevant to health product marketing that we are aware of regardless of quality. Often we do not agree with all or part of the contents.

Publication type: news

Breen T.
Drug companies spend thousands on W.Va. gifts
Business Week 2009 May 28
http://www.businessweek.com/ap/financialnews/D98FGJO81.htm

Full text:

A new state report shows drug manufacturers gave thousands of gifts and payments to doctors and nurses in West Virginia last year, ranging from the cost of a lunch to outlays of $20,000 or more.

Some health care advocates say it translates into higher medication costs.

The manufacturers, though, caution that the report doesn’t tell the full story, and point to the tens of millions of dollars’ worth of free medicine they donate in West Virginia every year.

The report, released during a legislative interim committee meeting Thursday, is the first available for a full year’s worth of spending by drug companies in the state. Lawmakers and health care advocates had long pushed for disclosure of costs related to advertising and gifts to prescribers.

The West Virginia Pharmaceutical Cost Management Council report found that in 2008, drug companies gave 15,382 gifts, grants or payments. There are 5,152 doctors and nurse practitioners who can prescribe medicine in the state, but the report didn’t track payments made to each prescriber, so that some prescribers may have gotten multiple gifts and some may have gotten nothing.

The report also didn’t provide a total dollar figure for the gifts, instead tracking gifts across broad ranges. For example, companies reported making 42 payments of $20,000 or more to prescribers and 574 payments of $2,500 or more.

By far the largest number of payments, 14,808, fell between $100 and $2,500.

A single prescriber who serves as an international spokesman for a company got payments between $125,001 and $127,500, acting Pharmaceutical Advocate Shana Phares said. It is the largest amount in the report.

The report doesn’t say what the payments were for, but typically they ranged from lunches at the lower end to addressing conventions at the higher end, Phares said, particularly if those conventions or gatherings were in other states or countries.

The report says pharmacies got $99,789 from drug companies and a single patient advocacy group got $11,500.

The report also lists total direct-to-consumer advertising costs of nearly $31 million. That money wasn’t spent solely on West Virginia, though, since ads here — especially on radio and TV — are often bought for markets that include portions of neighboring states.

It’s also hard to compare the data nationally, since few other states have similar reporting requirements, or even any reporting requirements at all.

Despite those limitations, Perry Bryant, executive director of West Virginians for Affordable Health Care, said the report is eye-opening.

“These expenses all get passed on to consumers in the form of higher costs for prescription drugs,” he said.

The Pharmaceutical Research and Manufacturers of America, or PhRMA, an industry group, though, says marketing is part of the cost of any business. In a statement Thursday, Ken Johnson, the group’s senior vice president, said drug companies face additional marketing costs because of requirements to comply with Food and Drug Administration requirements about what can be said about a particular medication.

He also noted that drug manufacturers donate about $60 million worth of prescription drugs to the state’s free health clinics annually.